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TMI Blog2016 (7) TMI 704X X X X Extracts X X X X X X X X Extracts X X X X ..... harma, Advocate JUDGMENT V. L. Achliya, J. 1. The petitioner herein has preferred this writ petition under articles 226 and 227 of the Constitution of India, seeking reliefs as under : (A) By issuing writ of certiorari or appropriate writ or directions or orders in like nature, impugned notice dated March 25, 2015 (Exhibit D ) issued by respondent No. 3 and sanction dated March 25, 2015 granted by the learned Additional Commissioner thereon, notice dated August 14, 2015 (Exhibit I ) issued by respondent No. 2 and impugned order dated September 16, 2015 (Exhibit J ) passed by respondent No. 2 recording reasons to believe under sections 147 and 148 of the Income-tax Act, 1961 may please be quashed and set aside. (B) To hold and declare that, impugned notice dated March 25, 2015 (Exhibit D ) issued by respondent No. 3 and sanction dated March 25, 2015 granted by the learned Additional Commissioner thereon, notice dated August 14, 2015 (exhibit I ) issued by respondent No. 2 and impugned order dated September 16, 2015 (exhibit J ) passed by respond ent no. 2 recording reasons to believe under sections 147 and 148 of the Income-tax Act are without jurisdiction, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f against their profits with a view to reduce their tax liability. The name of the petitioner was disclosed as one of such beneficiary of the manipulation and claimed losses of ₹ 36,60,755. As per return of income for assessment year 2010-11, losses of ₹ 62,82,394 from the derivatives (F and O segments) shown to be debited to profit and loss account and same appears to be loss of ₹ 36,60,755 claimed by the petitioner in the said assessment. In view of this, respondent No. 2 arrived at the conclusion that, there is reason to believe that income to the extent of ₹ 62,82,394 has escaped in the assessment as per third proviso to Explanation 2(c)(i) to section 147 of the said Act. After recording satisfaction that there is reason to believe that the said income has escaped during assessment year 2010-11, the authority submitted the file to the Additional Commissioner for Income-tax for seeking necessary approval under section 151(1) of the said Act to issue notice under section 148 of the Income-tax Act, 1961. The proposal for granting necessary approval was submitted on March 23, 2015 by respondent No. 3 to the Additional Commissioner of Income-tax, Range-I, Jal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l has invited our attention to sections 147 and 148 of the Income-tax Act, 1961 and by placing emphasis on the word Assessing Officer used in the said provision and defined under section 2(7A) of the Income-tax Act contended that, in the facts and circumstances of the case, the Joint Commissioner of Income-tax alone was competent to make reassessment and issue notice under section 148 of the said Act and respondent No. 3 had no jurisdiction to reopen assessment and issue impugned notice. In this context, the learned counsel has placed reliance on the decision of the Delhi High Court in the case of Dushyant Kumar Jain v. Deputy CIT reported in [2016] 381 ITR 428 (Delhi). 5. Mr. Alok Sharma, learned counsel appearing for respondents Nos. 1 to 3 has countered the submissions advanced with contention that, in the matter of the petitioner respondent No. 3 is an Assessing Officer for all purposes under the provisions of Income-tax Act as the case in question falls under his jurisdiction. It is submitted that, the assessment of the subsequent period, i.e., 2011-12 and onwards wherein the petitioner had disclosed the income below ₹ 10.00 lakhs, finalised by respondent No. 3 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961, for reassessment of assessment made for the year 2010-11. The Additional Commissioner of Income-tax has considered the same and on due satisfaction that the case is fit for reassessment, was pleased to accord sanction for reopening of case under section 147 of the Income-tax Act as well as issuance of notice under section 148 of the Income-tax Act. It is therefore submitted that, the entire action on the part of respondent No. 3 was within the bounds of law and in accordance with the procedure prescribed under the said Act. It is further submitted that, after the petitioner filed his response to the notice issued under section 148 of said Act and submitted the copy of return, it was found that the original assessment under section 143(3) for the assessment year 2010-11 was done by the Joint Commissioner of Income-tax, Range-I, Jalgaon and return income and assessed income is above ₹ 1.00 crore, respondent No. 3 transferred the proceedings to the file of the Deputy Commissioner of Income-tax, Circle-I, Jalgaon, as contemplated under section 127 of the Income-tax Act, 1961 and now the same is dealt with by the Deputy Commissioner of Income-tax, Circle-I, Jalgaon. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -sections (1) and (2), the Board or other Income-tax authority authorised by it may have regard to any one or more of the following criteria, namely :- (a) territorial area ; (b) persons or classes of persons ; (c) incomes or classes of income ; and (d) cases or classes of cases. 8. As discussed in the foregoing paras that there is no dispute as to the fact that the basic jurisdiction, i.e., territorial and pecuniary jurisdiction to assess income up to 10.00 lakhs to entertain the case of the petitioner for assessment lies with respondent No. 3 and the assessment of the period 2011-12 onwards. As the information was received from the Director of Income-tax (Intell and Cr.Inv), Mumbai and it was found that the petitioner had escaped certain income during the assessment year 2010-11, respondent No. 3 proceeded with the matter. After recording satisfaction that there is reason to believe that the income has been during assessment year 2010-11, respondent No. 3 submitted the file for seeking necessary approval under section 151 of the said Act to issue notice under section 148 of the Income-tax Act, 1961. On due consideration of the reasons recorded by the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ank of the Joint Commissioner of Income-tax can only make reassessment. The Deputy Commissioner of Income-tax, who is now dealing with the case is duly competent and possess the pecuniary and territorial jurisdiction to deal with the case of the petitioner for reassessment. For this reason alone, we are not inclined to accept the contention of learned counsel that the Joint Commissioner of Income-tax alone competent to make reassessment for the year 2010-11. 10. The impugned notice under section 148 of the said Act was issued to the petitioner on March 25, 2015. By the notice issued the petitioner was called upon to submit the return of the assessment year 2010-11 in the prescribed proforma. It is mentioned in the notice that the notice has been issued after due satisfaction of the Assessing Officer that there is reason to believe that in the income chargeable for the assessment year 2010-11, the petitioner has escaped certain amount from assessment within the meaning of third proviso to Explanation 2(c)(i) to section 147 of the said Act. In the notice it is also mentioned that necessary approval has been granted by the Additional Commissioner of Income-tax for issuing such noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the first proviso to section 144 to show cause why the assessment should not be com pleted to the best of the judgment of the Assessing Officer, whichever is earlier. 11. Learned counsel for the petitioner has relied on the decision of the Delhi High Court in the case of Dushyant Kumar Jain v. Deputy CIT reported in [2016] 381 ITR 428 (Delhi). In our view the decision in the case of Dushyant Kumar has no bearing upon the facts of the present case. The facts of the case cited are altogether different from the present case. In the case cited the notice was issued and reasons for reopening assessment were recorded by the Income-tax Officer, who was not the Assessing Officer for the assessee for the concerned assessment year. So also the notice was found to be issued beyond the period of limitation prescribed under the provisions of section 149(1)(b) of the said Act. In the present case, the notice has been issued within limitation, so also notice was issued by the Assessing Officer having territorial jurisdiction to deal with the case of petitioner. It is nowhere the case of the petitioner that respondent No. 3 is not the Assessing Officer for the petitioner. So also the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice under section 148 of the Income-tax Act is issued, the proper course of action for the noticee is to file return and if he so desires, to seek reasons for issuing notices. The Assessing Officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the Assessing Officer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the Assess ing Officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the above said five assessment years. In the instant case, the fact is not in dispute that on the request of the petitioner the respondent has provided copy of the reasons recorded by respondent No. 3 as well as the copy of the order passed under section 151 of the said Act. So no case of prejudice caused to the petitioner has been made out. 14. In the light of the discussion made in the foregoing paras, we are of the view that there is no merit in the petition filed. The impugned notices cannot be said to be issued without jurisdict ..... X X X X Extracts X X X X X X X X Extracts X X X X
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