2024 (4) TMI 650 - HC - Income Tax

Reopening of assessment u/s 147 - as argued documents submitted by the petitioner were not taken into consideration while drawing up the assessment order - HELD THAT - Findings were recorded that the assessee failed to submit export bills proof of customs clearance remittance proof copy of purchase bills and confirmation of payment made to agriculturists. Out of these export bills were certainly attached with the petitioner s reply on 15.02.2024. As regards purchase bills the purchase ledger and the GSTR annual returns were filed. It is likely that much of the information requested for would be contained in these documents. However it should be recognised that the petitioner does not appear to have submitted all necessary documents. Nonetheless since the documents submitted by the petitioner were not discussed and no reasons are recorded for confirming the proposed variations the impugned order calls for interference. Besides it should be noticed that tax was imposed not only on deposits but also on withdrawals. For reasons set out above the impugned order is set aside and the matter is remanded to the 1st respondent for reconsideration. The petitioner is permitted to submit any additional documents within a maximum period of 15 days from the date of receipt of a copy of this order. Upon receipt thereof the 1st respondent is directed to provide a hearing through video-conference to the petitioner and issue a fresh assessment order within a maximum period of two months from the date of receipt of additional documents from the petitioner.

Summary

Issues involved: Challenge to assessment order for assessment year 2018-2019 under the Income Tax Act, 1961.

Summary:

Issue 1: Filing of Income Tax Returns
The petitioner, an income tax assessee, did not file income tax returns for the relevant assessment year. After receiving notice under Section 148 of the Income Tax Act, the petitioner submitted the return of income and responses to subsequent notices under Sections 143(2) and 142(1). The impugned assessment order was issued based on these submissions.

Issue 2: Contentions of the Petitioner
The petitioner's counsel argued that despite submitting multiple documents, including export bills, purchase bills, and bank statements, the assessment order did not consider the information provided. The petitioner sought another opportunity to be heard, emphasizing that the documents were not taken into account during the assessment process.

Issue 3: Respondent's Position
The senior standing counsel for the respondents highlighted that the petitioner had ample opportunities to respond to notices but failed to do so adequately. It was pointed out that significant unexplained transactions were identified in the petitioner's bank account, leading to the imposition of taxes and initiation of penalty proceedings. The counsel contended that the principles of natural justice were followed, and no further indulgence should be granted to the petitioner.

Issue 4: Court's Analysis and Decision
The court noted that despite the petitioner's delayed filing of income tax returns, various documents were eventually submitted, including import bills, export bills, and bank statements. However, the assessment order did not adequately consider these submissions. Consequently, the court set aside the impugned order and remanded the matter for reconsideration by the tax authorities. The petitioner was allowed to submit additional documents within 15 days, and a fresh assessment order was to be issued within two months. The petitioner was instructed to cooperate fully in the reassessment process.

Conclusion
The writ petition challenging the assessment order was disposed of, with no costs imposed. The court emphasized the need for the petitioner to adhere to the specified timelines and cooperate in the reassessment proceedings.