2025 (1) TMI 703 - HC - Income Tax

Validity of reopening proceedings - as argued since the quantum of transaction is less than 50 lacs, no notice could have been issued u/s 149(1) - whether petitioner has an alternative statutory remedy? - HELD THAT - As in view of the judgment of M/s Amrit Homes Private Limited 2023 (8) TMI 683 - MADHYA PRADESH HIGH COURT which is binding on this Court and also taking into consideration the law laid down in Supreme Court in Celir LLP Vs. Bafna Motors (Mumbai) (P) Limited. 2023 (10) TMI 48 - SUPREME COURT since there exists an alternative statutory remedy, it will not be proper to advert to the merits of the case and scuttle the process of reassessment specially in view of the alternative statutory remedy as is available to the petitioner.

1. ISSUES PRESENTED and CONSIDERED

The legal judgment revolves around the following core issues:

Whether the issuance of a notice under Section 148-A(d) of the Income Tax Act was justified in the given circumstances.
Whether the transactions involving the petitioner warranted a reassessment notice based on the quantum of transactions and the provisions of Section 149(1) of the Income Tax Act.
Whether the petitioner should be directed to avail the alternative statutory remedy instead of seeking relief through writ jurisdiction.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Justification of Notice under Section 148-A(d)

Relevant Legal Framework and Precedents: Section 148-A(d) pertains to the issuance of notices for reassessment under the Income Tax Act. The petitioner challenges the notice issued by the respondent, claiming it was unwarranted.
Court's Interpretation and Reasoning: The court considered the petitioner's argument that all transactions were duly recorded and reported in the income tax return and audit report.
Key Evidence and Findings: The petitioner submitted evidence of transactions, asserting that they were clear and correctly reported.
Application of Law to Facts: The court examined whether the transactions, as reported, justified the issuance of the notice under the relevant sections of the Income Tax Act.
Treatment of Competing Arguments: The petitioner relied on precedents from various High Courts, arguing that the notice was unjustified, while the respondent cited a Division Bench decision of the same court to counter the petitioner's claims.
Conclusions: The court found that the petitioner had an alternative statutory remedy and thus did not delve into the merits of the case.

Issue 2: Quantum of Transactions and Provisions of Section 149(1)

Relevant Legal Framework and Precedents: Section 149(1) of the Income Tax Act stipulates conditions under which a notice for reassessment can be issued, particularly focusing on the quantum of transactions.
Court's Interpretation and Reasoning: The petitioner argued that the transactions did not meet the threshold for reassessment under Section 149(1), as the amount was less than 50 lakh rupees.
Key Evidence and Findings: The petitioner provided evidence to show that the transactions were below the statutory limit, questioning the necessity of the notice.
Application of Law to Facts: The court analyzed whether the transactions, as presented by the petitioner, fell within the scope of Section 149(1) for reassessment purposes.
Treatment of Competing Arguments: The respondent maintained that the notice was valid, citing the court's previous decisions, which emphasized the plain meaning of statutory provisions.
Conclusions: The court upheld the respondent's argument, emphasizing the availability of an alternative remedy for the petitioner.

Issue 3: Alternative Statutory Remedy

Relevant Legal Framework and Precedents: The court referred to its previous decision in M/s Amrit Homes Private Limited, which highlighted the importance of alternative statutory remedies.
Court's Interpretation and Reasoning: The court reiterated that writ jurisdiction should not be exercised when an alternative statutory remedy exists.
Key Evidence and Findings: The court noted the binding nature of its previous decision and the Supreme Court's stance in Celir LLP Vs. Bafna Motors (Mumbai) (P) Limited.
Application of Law to Facts: The court applied the principle of alternative remedy, directing the petitioner to pursue the statutory route.
Treatment of Competing Arguments: The petitioner sought relief through writ jurisdiction, while the respondent emphasized the need to follow statutory procedures.
Conclusions: The court dismissed the petition, advising the petitioner to avail the statutory remedy.

3. SIGNIFICANT HOLDINGS

Verbatim Quotes of Crucial Legal Reasoning: "Pertinently, these Courts have not considered the foundational principle of interpretation of taxing statute i.e. nothing can be read into or implied and the plain meaning of the words used in the taxing statute are to be given their due meaning."
Core Principles Established: The court reaffirmed the principle that writ jurisdiction should not be exercised when an alternative statutory remedy is available, especially in matters involving tax reassessment.
Final Determinations on Each Issue: The court dismissed the petition, emphasizing the availability of an alternative statutory remedy for the petitioner.

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