2024 (4) TMI 990 - HC - Income Tax

Validity of Reassessment notices issued unsigned - maintainability of writ petition against this issue in HC - According to petitioner, absence of a signature on the impugned notice is a substantial defect and afflicts the impugned notice with manifest illegality and this defect is incurable - HELD THAT - It is true that without the reasons to believe escapement of income, petitioner would not be able to file its objections to the notice issued under Section 148 of the Act. It is also true that this stand of illegality of the notice has been taken for the first time in the petition. In the two communications sent by petitioners' Chartered Accountant this stand has not been taken. We would hasten to add we are not giving any decision on waiver or estoppel. We are only saying that against the notice petitioner has straight away approached this Court without even complying with the requirements stated by the Hon ble Apex Court in GKN Driveshafts (India) Ltd. 2002 (11) TMI 7 - SUPREME COURT . In our view, petitioner should have, on the basis of the ratio laid down by the Hon ble Apex Court in GKN Driveshafts (India) Ltd. (Supra), filed return of income and then sought reasons for issuing the notice. In response, the Assessing Officer was bound to provide the reasons within a reasonable time. On receipt of reasons, petitioner was entitled to file objections and the Assessing Officer was bound to dispose the same by passing a speaking order. Therefore, in our view, this is not a fit case to exercise our jurisdiction under Article 226 of the Constitution of India in view of petitioner not complying with the ratio laid down by the Hon ble Apex Court in GKN Driveshafts (India) Ltd. (Supra). Petitioner may file objections to the impugned notice dated 26th March 2012 together with the return of income within four weeks from today. In the objections to be filed, petitioner may raise all defences including those raised in this petition. The Assessing Officer shall dispose the objections but before disposing the same, shall give a personal hearing to petitioners, notice whereof shall be communicated atleast five working days in advance. The order disposing objections shall be a reasoned order dealing with all objections and if the Assessing Officer intends to rely on any judgments/orders of any Court or Tribunal, a list thereof shall be made available with the notice for personal hearing so that petitioner will be able to deal with/distinguish the same. Thus without expressing any view on the merits of the matter, petition dismissed.

Summary

Issues involved:
Challenge to notice u/s 148 of the Income Tax Act, 1961 on grounds of being unsigned and time-barred.

Summary:
1. The petitioner challenged a notice issued by the Assistant Commissioner of Income Tax u/s 148 of the Income Tax Act, 1961, alleging it to be invalid due to being unsigned.
2. The Court considered the validity of the unsigned notice as a substantial defect.
3. The primary ground of challenge was the absence of a signature on the notice, deemed as a manifest illegality.
4. Petitioner had filed its return for Assessment Year 2005-2006, with an assessment order passed subsequently.
5. The impugned notice was issued post a search at the petitioner's premises, alleged to be time-barred and received without a signature.
6. Petitioner's requests to withdraw the notice and provide reasons were not met by the Department, leading to the current petition.
7. Respondent argued that the unsigned notice was not an incurable defect and provided legal defenses.
8. The Court noted the petitioner's failure to comply with the procedure outlined by the Apex Court in GKN Driveshafts (India) Ltd. v/s. Income Tax Officer.
9. Petitioner's counsel argued that a valid notice was a jurisdictional fact, and the unsigned notice rendered it invalid.
10. A comparison was drawn with a previous case where objections were filed, highlighting the petitioner's failure to respond to the current notice.
11. Reasons for re-opening assessment were provided in the reply, emphasizing the alleged escapement of income.
12. The Court directed the petitioner to file objections within four weeks, addressing all defenses, with a provision for a personal hearing.
13. The petition was dismissed without expressing any view on the merits, with no order as to costs.