2025 (2) TMI 765 - HC - Income Tax

Reopening of assessment u/s 147 - as argued procedure contemplated by Section 148A as not been followed before issuing the impugned notices - case of the appellant was not such as permitted the department to avoid following the procedure contemplated u/s 148A more so because it could not be said that proceedings u/s 132A had been initiated against the appellant in the instant case.- HELD THAT - Appellant s submission appears to confuse between the existence of a power u/s 132A of the I.T. Act and the manner of exercise of that power. Merely because the Department had resorted to a different procedure under the Cr.P.C. for the purposes of effectuating the action initiated under Section 132A it could not be said that the power under Section 132A had not been invoked and the proceedings thereunder initiated for the purposes of the I.T. Act. Inasmuch as the provisions of Section 132A have been invoked we are in agreement with the finding of Single Judge that there was no requirement for compliance with the procedure contemplated u/s 148A of the I.T. Act prior to issuing the impugned notices under Section 148. Thus Writ Appeal fails and is accordingly dismissed.

Summary

The petitioner in W.P.(C).No.9269 of 2024 appealed against the judgment of the learned Single Judge in the writ petition and the subsequent order in R.P.No.482 of 2024, where the Review Petition was dismissed. The appellant contested notices issued under Section 148 of the Income Tax Act, 1961 for the assessment years 2020-21 to 2023-24, arguing that the procedure under Section 148A of the Act had not been followed. The appellant claimed that as proceedings under Section 132A of the Act were not initiated, the notices were invalid.The learned Single Judge considered the appellant's arguments and the Income Tax Department's submissions. The Judge found that the Department had issued a requisition under Section 132A to the Police based on seized amounts from individuals. The Department then applied under Section 451 of the Cr.P.C. to obtain custody of the seized amounts held by the court. The Judge concluded that the Department had effectively initiated proceedings under Section 132A, thus dismissing the writ petition. The Review Petition highlighting inconsistencies in the Department's actions was also dismissed by the Judge.In the appeal, the appellant's counsel argued that as the Department used Cr.P.C. provisions to obtain the seized amounts, Section 132A was not invoked, and thus, the Section 148A procedure should have been followed. However, the Court disagreed, stating that the Department's actions did not negate the invocation of Section 132A. The Court held that since Section 132A was invoked, compliance with Section 148A was not necessary for issuing the notices under Section 148. Consequently, the Writ Appeal was dismissed based on the reasoning of the Single Judge.In summary, the Court upheld the initiation of proceedings under Section 132A of the Income Tax Act, ruling that compliance with Section 148A was not required for issuing notices under Section 148. The appellant's appeal was dismissed based on these findings.