2024 (6) TMI 1028 - HC - Income Tax

Reopening of assessment u/s 147 r.w.s.144B as preceded by a proceeding u/s 148A - Alternative Remedy through Appeal - petitioner did not respond to the notice u/s 148A (b), in fact, when an intimation was given to the assessee in accordance with the procedure laid down u/s 144B vide notice the petitioner did not seek for documents - HELD THAT - Admittedly, in this case, it is noticed that the order of assessment issued u/s 147 r.w.s. 144B of the said Act was preceded by a proceeding u/s 148A of the said Act and not only a notice u/s 148A (b) was issued but an order was passed u/s 148A (d) of the said Act. The petitioner, however, had not responded to the said notice u/s 148A (b) of the said Act. The disclosures made in the order of assessment were all disclosed in the notice u/s 148A (b) of the said Act and in the order u/s 148A (d) of the said Act. Be that as it may, since the petitioner has an alternative remedy in the form of an appeal, all these points can be agitated by the petitioner before the appellate authority and if the petitioner files an appeal before the appellate authority and makes an application for disclosure of the documents and other information, it shall be open to the appellate authority to consider the same, subject to the appeal being registered upon condonation of delay, in accordance with law.

Issues involved:
The present judgment involves a challenge to an assessment order under Section 147 of the Income Tax Act, 1961, for the assessment year 2018-19. The main issues revolve around the lack of disclosure of information to the petitioner, treatment of entities as fake, the timeliness of filing the writ petition, and the availability of an alternative remedy through an appeal.

Challenge to Assessment Order:
The petitioners challenged the assessment order on the grounds that they were not provided with the information and materials used in the assessment, which they argue vitiates the order. They specifically highlight discrepancies in the treatment of entities as fake and the addition of their purchases to the petitioner's income. The petitioners claim they were denied the opportunity to respond appropriately to the enquiries, thus questioning the validity of the assessment order.

Timeliness of Writ Petition:
The respondents argued that the writ petition was not maintainable as the assessment order was appealable, and the petition was filed after the expiration of the ordinary appeal period. They pointed out that the notice for the assessment year 2018-19 was issued in March 2022, and the petition was filed in April 2024, beyond the allowable timeframe for filing an appeal under the Income Tax Act.

Disclosure of Information:
The respondents contended that the petitioner was duly notified about the circumstances leading to the assessment proceeding, even though the information was not initially provided along with the notice. However, the department rectified this by sending the necessary information to the petitioner via email within two days of the notice. The respondents emphasized that the information considered in the assessment order was disclosed in the notice under Section 148A and subsequent order under Section 148A (d) of the Income Tax Act.

Alternative Remedy through Appeal:
The Court noted that the petitioner had an alternative remedy available in the form of an appeal. The Court opined that the petitioner could raise all points before the appellate authority, including seeking disclosure of documents and information. The judgment emphasized that the appellate authority could consider these points upon the filing of an appeal, subject to the appeal being registered after condonation of any delay, in accordance with the law.

Conclusion:
The Court disposed of the writ petition, emphasizing that the petitioner could pursue their grievances before the appellate authority. The judgment clarified that the Court did not delve into the merits of the case, leaving it open for the petitioner to raise all relevant points during the appeal process. All parties were directed to act based on the server copy of the order downloaded from the Court's official website.

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