2023 (1) TMI 777 - HC - Income Tax

Reopening of assessment u/s 147 - reassessment proceedings as commenced by issuing notice against a non-existent entity, i.e., the partnership firm which bears the same name as the petitioner - HELD THAT - It is averred that the petitioner before us is a proprietorship concern. It is also averred that the proprietor of the petitioner concern is one Mr Deepak Dogra, who, along with Mr Himanshu Taneja, formed the partnership firm going by the same name, i.e., Bharat Agro Overseas (India). The petitioner also claims that communications were addressed on 31.03.2017, whereby the surrender and cancellation of the PAN allocated to the partnership firm was sought. This request, according to the petitioner, was made once again on 27.02.2020. Therefore, while dealing with the notice issued u/s 148A(b), these contentions, apart from other contentions that may be raised on behalf of the petitioner, will be dealt with by the AO. In order to hasten the proceedings, the AO is directed to furnish the relevant information/material to the petitioner within four weeks from the date of receipt of a copy of the order passed today.

Summary

Issues Involved:
Challenge to notice under Section 148A(b) of the Income Tax Act, 1961 for AY 2013-2014; Assailing order under Section 148A(d) and consequential notice under Section 148; Reassessment proceedings against a non-existent entity; Furnishing of material to petitioner by AO.

Analysis:

1. Challenge to Notice under Section 148A(b):
The writ petition challenges a notice dated 23.05.2022 issued under Section 148A(b) of the Income Tax Act, 1961 for AY 2013-2014. During the hearing, it was revealed that the information/material forming the basis for the notice was not supplied to the petitioner. The AO was uncertain whether the material/information was provided partially or wholly. Consequently, the order under Section 148A(d) and the consequential notice under Section 148 issued on 30.07.2022 were set aside, granting the respondents/revenue liberty to proceed as per law.

2. Reassessment Proceedings Against Non-Existent Entity:
The petitioner contended that reassessment proceedings were initiated against a non-existent entity, a partnership firm sharing the petitioner's name, while the petitioner is a proprietorship concern. The petitioner claimed that requests for surrender and cancellation of the PAN allocated to the partnership firm were made in 2017 and 2020. The respondents contested these claims on both factual and legal grounds. The AO was directed to provide relevant information/material to the petitioner within four weeks and allow three weeks for the petitioner to respond.

3. Furnishing of Material by AO:
To expedite the proceedings, the AO was directed to furnish relevant information/material to the petitioner within four weeks from the date of the court's order. Subsequently, the petitioner was granted three weeks to respond to the notice and the furnished material. The writ petition was disposed of based on these terms, with the pending application closed.

In conclusion, the judgment addressed the challenges to the notice under Section 148A(b), the issue of reassessment against a non-existent entity, and the directive for the AO to provide necessary information to the petitioner. The court set aside the impugned order and notice, allowing the respondents to proceed in accordance with the law while ensuring the petitioner's right to respond to the furnished material.