9911796707
TMI Blog2022 (7) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act, there was some material on record that the income chargeable to tax which escaped assessment amount to or is likely to amount Rs.50,00,000/- or more for that year. On conjoint reading of the provisions contained in Section 148A and what has been provided u/s 149, it is vividly clear that in order to initiate proceedings u/s 148A, it is not enough that in case where notice is proposed to be issued under Section 148 after three years have elapsed from the end of the relevant assessment year that there should exist material available on record to reach to conclusion that some income chargeable to tax has escaped assessment, but the amount should be more than Rs.50,00,000/-. Only on the basis that the cash deposits chargeable to tax have escaped assessment, without anything more, the authority was not justified in jumping to the conclusion that the assessee may have more bank accounts. If such an interpretation is placed on the provision of Section 148A (d) of the Act with reference to expression material available on record , then in that case, it will open flood gate and even without availability of any material, the authority would be initiating proceedings u/s 148 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee did not disclose this amount of cash deposit during the relevant financial year and, therefore, on that basis, the proceedings are required to be initiated. Replying to the said notice, the petitioner-assessee stated that the initiation of proceedings on the basis that the cash deposits during the relevant financial year are Rs.52,75,000/- is factually incorrect and according to the petitioner-assessee, the total amount of cash deposit in his bank account in the Corporation Bank was only Rs.19,39,000/-. The petitionerassessee, in order to satisfy the authority that the total cash deposits in that particular financial year were only Rs.19,39,000/-, also annexed along with the reply, complete bank statement of transactions done during the financial year in question. The competent authority, however, proceeded to pass an order for issuance of notice under Section 148 of the Act on 29.03.2022. Thereafter, a notice under Section 148 of the Act has been issued to the petitioner-assessee. The order dated 29.03.2022 passed under Section 149A (d) of the Act as also notice under Section 148 of the Act have been assailed in this petition. Learned counsel for the petitioner-as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngs. He would further submit that the inference drawn by the authority on the basis of the fact that the account in which undisclosed cash deposits of more than Rs.19,00,000/- were made itself suggests that the assessee, who is otherwise an NRI, may have many more bank accounts. He would submit that such an inference taken together with the cash deposit details disclosed during enquiry, by itself, is sufficient to validate the impugned order and issuance of notice under Section 148 of the Act. We have heard learned counsel for the parties and perused the records. After amendment carried out in the income tax under The Finance Act, 2021, even before proceedings under Section 148 of the Act could be drawn, the law requires an order to be passed under Section 148A of the Act by conducting an enquiry in the manner provided under Section 148A of the Act and satisfaction to be arrived at on the basis of material available on record that income chargeable to tax has escaped assessment for the relevant assessment year. The relevant provisions contained in Section 148A of the Act, being relevant, are extracted as below:- 148A. Conducting inquiry providing opportunity before issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or requisitioned under section 132A, in case of any other person on or after the 1st day of April, 2021, pertains or pertain to, or any information contained therein, [relate to, the assessee; or (d) the Assessing Officer has received any information under the scheme notified under section 135A pertaining to income chargeable to tax escaping assessment for any assessment year in the case of the assessee.] Explanation.-For the purposes of this section, specified authority means the specified authority referred to in section 151.] The provision is explicitly clear that the Assessing Officer shall, before issuing any notice under Section 148 of the Act, conduct enquiry, the details of which have been contained in Sub Clause (a) (b) (c), which requires seeking prior approval of specified authority with respect to the information; providing an opportunity of being heard to the assessee and consideration of the reply of the assessee. Sub-Clause (d) of Section 148A of the Act mandates that after conducting enquiry by affording an opportunity of hearing and consideration of reply, the authority shall decide, on the basis of material available on record, including rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the assessee has furnished copy of one saving account only, there may be one or more account(s) in Corporation Bank in his name or PAN. Thus, it is logical to conclude that the assessee s reply is not fully satisfactory with respect to the above mentioned escapement of income in his case for AY 2015-16. It is crystal clear from what has been recorded in para 6 of the impugned order that though the competent authority did not dispute various transactions meaning thereby that the material available on record, did not show any cash deposits more than what was asserted by the petitioner-assessee, which was far less than the amount as stated in the notice under Section 148A (d) of the Act, the officer proceeded to hold that there may be one or more accounts in the Corporation Bank in his name or PAN. It is on this surmise, bereft of any material on record that the authority seems to justify its action and impugned order dated 29.03.2022. The provisions contained in Section 148A (d) of the Act referred to hereinabove, clearly show that the decision has to be taken on the basis of material available on record. The material available on record before the authority did not disclos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n a case, where a notice under Section 153A, or section 153C read with section 153A, is required to be issued in relation to a search initiated under section 132 or books of account, other documents or any assets requisitioned under section 132A, on or before the 31st day of March, 2021: Provided also that for the purposes of computing the period of limitation as per this section, the time or extended time allowed to the assessee, as per showcause notice issued under clause (b) of section 148A or the period during which the proceeding under section 148A is stayed by an order or injunction of any court, shall be excluded: Provided also that where immediately after the exclusion of the period referred to in the immediately preceding proviso, the period of limitation available to the Assessing Officer for passing an order under clause (d) of section 148A is less than seven days, such remaining period shall be extended to seven days and the period of limitation under this sub-section shall be deemed to be extended accordingly. Explanation.-For the purposes of clause (b) of this sub-section, asset shall include immovable property, being land or building or both, shar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e than Rs.50,00,000/-. Only on the basis that the cash deposits of Rs. 19,39,000/- chargeable to tax have escaped assessment, without anything more, the authority was not justified in jumping to the conclusion that the assessee may have more bank accounts. If such an interpretation is placed on the provision of Section 148A (d) of the Act with reference to expression material available on record , then in that case, it will open flood gate and even without availability of any material, the authority would be initiating proceedings under Section 148 of the Act, which will completely frustrate the object of incorporation of Section 148A in the Act. It is well settled principle of interpretation that the taxing statute is required to be construed strictly. The interpretation as has been suggested by the learned counsel for the revenue cannot be placed upon the expression material available on record to include possibility of collection of any relevant or tangible material for opening of proceedings under Section 148A of the Act. Learned counsel for the revenue has placed reliance upon the decision of the Delhi High Court in the case of Gulmuhar Silk Pvt. Ltd. Versus Income Tax O ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
