2024 (5) TMI 447 - HC - Income Tax

Reopening of assessment u/s 147 - appropriate authority for issuance of the notice - approval of the specified authority u/s 151 - Proceedings after a lapse of more than three years - HELD THAT - As per Section 151 of the Act and considering the fact that the reopening of the case is occurring after a lapse of more than three years the appropriate authority for issuance of the notice under Sections 148 and 148A (b) of the Act should have been either the Principal Chief Commissioner or Principal Director General or in their absence the Chief Commissioner or Director General instead of the Principal Commissioner of Income Tax Delhi-10 who does not fall within the specified authorities outlined in Section 151 of the Act. See TWYLIGHT INFRASTRUCTURE PVT LTD 2024 (1) TMI 759 - DELHI HIGH COURT Thus we allow the instant writ petition and quash the impugned notices.

Summary

Issues involved:
The petition seeks to quash notices u/s 148A (b) and 148, and order u/s 148A (d) of the Income Tax Act, 1961 for AY 2017-18.

Details of the Judgment:

1. The petitioner, engaged in wholesale trading, filed an Income Tax Return (ITR) for AY 2017-18 declaring income. The ITR was scrutinized for capital gains/loss and cash deposits during demonetization.

2. The Revenue issued notices seeking verification of cash deposits and confirmation from a supplier. An assessment order was passed accepting the ITR.

3. A notice u/s 148 was issued to reopen assessment, but it was quashed based on legal precedents. Subsequently, a Supreme Court decision clarified treatment of notices issued between specific dates.

4. The Revenue issued a fresh notice u/s 148A (b) alleging an increase in sales turnover, leading to a reassessment order u/s 148A (d).

5. Petitioner argued lack of jurisdiction in reassessment proceedings, citing absence of new substantial evidence and improper authority issuing the notice.

6. The Court found the challenge concluded based on a previous judgment, quashing the impugned notices and order, with liberty reserved for the Revenue to initiate reassessment proceedings afresh if required by law.

7. The writ petition was disposed of accordingly, with rights and contentions of both parties remaining open for any future reassessment proceedings.