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TMI Blog2024 (2) TMI 929X X X X Extracts X X X X X X X X Extracts X X X X ..... as per principles laid down in Tiwari Kanhaiya Lal and S.G.Portfolio. The petitioner did not, however, resort to either option. Thereafter, AO issued notice u/s 142(1) calling upon the assessee to produce the documents specified in such notice. The annexure to the notice indicates that the petitioner did not comply with the notice u/s 148. Upon receipt of this notice, the petitioner replied asking for reasons for reopening the assessment and attached certain documents, while requesting for further time to submit other documents. This communication was issued more than six months after receipt of notice u/s 148. As contended if the petitioner had provided a revised return of income or called upon the assessing officer to treat the original return of income as the return in response to notice u/s 148, the petitioner would have been entitled to challenge the proceedings on the ground that reasons for re-assessment were not provided, but not otherwise. The impugned order does not warrant interference on the ground that principles laid down in GKN Driveshafts [ 2002 (11) TMI 7 - SUPREME COURT ] were not complied with. For the same reason, i.e. non-filing of return, and the consequentia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no proof of carrying out work was submitted by the assessee. In these facts and circumstances, conclude that there is no justification for exercising discretionary jurisdiction. The impugned assessment order does not warrant interference under Article 226 of the Constitution of India. - THE HONOURABLE MR. JUSTICE SENTHILKUMAR RAMAMOORTHY For the Petitioner : Mr.M.V.Swaroop For the Respondents : Mr.A.P.Srinivas, Senior Standing Counsel and Mr.A.N.R.Jayaprathap, Junior Standing Counsel ORDER Both these writ petitions pertain to assessment year 2016-17. In W.P.No.349 of 2022, the assessment order dated 16.12.2021 and the consequential notice of demand dated 16.12.2021 are assailed. In W.P.No.25984 of 2022, the order dated 28.06.2022 imposing penalty is impugned. 2. The common petitioner is an individual engaged in the business of running a ladies hostel in the name of M/s. Olive Castles. The petitioner asserts that she also carries on real estate-related business in collaboration with her husband. For assessment year 2016-17, the petitioner filed the return of income on 17.10.2016 and declared a total income of Rs.97,08,580/-. Pursuant to a survey, a notice under Section 148 (as it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e because it is no longer possible for the assessing officer to complete re-assessment within the limited time available. It is also submitted that a second remand was frowned on by the Hon'ble Supreme Court. In support of these submissions, learned counsel referred to and relied upon the following judgments: (i) Tiwari Kanhaiya Lal v. Commissioner of Income Tax (Tiwari Kanhaiya Lal), MANU/RH/0071/1984, particularly paragraph 8 thereof, for the principle that the previous return of income may be treated as the return under Section 148. (ii) Principal Commissioner of Income-tax v. S.G.Portfolio (P) Ltd (S.G.Portfolio), [2023] 151 taxmann.com 307 (Delhi), particularly paragraphs 10,11,22 and 23, for the principle that the return filed earlier should be treated as a return in response to notice issued under Section 148, if the assessee had so informed the assessing officer. (iii) Sapthagiri Finance and Investments v. ITO, MNU/TN/2713/2012, particularly paragraphs 8, 9, 11 and 12, for the proposition that the procedure prescribed under Section 143(2) is applicable to proceedings pursuant to notice under Section 148. (iv) Andaman Timber Industries v. Commissioner of Central Excise, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted, in this regard, that the Evidence Act, 1872, is not applicable to these proceedings and that the assessee cannot demand a right of cross-examination in all circumstances. Turning to the statement of M/s.Meenakshi Timber Plywood, by referring to paragraph 21 of the impugned order, learned counsel submitted that the statement of the said entity was that M/s.Olive Castles, which is the proprietary concern of the petitioner, front-ended the execution of the project. Therefore, he submitted that no prejudice was caused to the petitioner by not being provided the statement of M/s.Meenakshi Timber Plywood. The next contention of learned senior standing counsel was that the petitioner did not raise any grounds, other than not providing reasons for re-opening assessment and breach of principles of natural justice by not providing sufficient time limit to reply to the show cause notice, in the earlier writ petition. He submits that all other grounds were raised for the first time in the second round of litigation. He concluded his submissions by stating that the petitioner should avail of the statutory appeal since the case turns on disputed questions of fact. 6. In light of the abo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice, the petitioner replied asking for reasons for reopening the assessment and attached certain documents, while requesting for further time to submit other documents. This communication was issued more than six months after receipt of notice under Section 148. As contended by learned senior standing counsel, if the petitioner had provided a revised return of income or called upon the assessing officer to treat the original return of income as the return in response to notice under Section 148, the petitioner would have been entitled to challenge the proceedings on the ground that reasons for re-assessment were not provided, but not otherwise. This is evident from paragraph 5 of the SCC report in GKN Driveshafts, which is set out below: 5. We see no justifiable reason to interfere with the order under challenge. However, we clarify that when a notice 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 notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence while exercising discretionary jurisdiction, but not otherwise. 11. The last ground on which the petitioner assailed the impugned order was that a remand should not be made for a second time and that the time limit for issuing the assessment order was close to expiring when the assessment order was issued. The broad proposition that there should be no remand for a second time is not supported by statute or precedent and, in any event, on account of conclusions recorded earlier, the petitioner cannot succeed on this basis. 12. The petitioner was provided a reasonable opportunity to place on record evidence of execution of civil work (mass excavation and sand-filling), such as contracts for hiring excavation and other equipment, running account and final bill, proof of payment by the employer, contracts with sub-contractors, running account and final bills of sub-contractors, proof of payment to sub-contractors, and the like. Apart from producing work orders, photographs and the offer letter of employment of Mantri Developers Private Limited, the petitioner did not place any other evidence on record leading to the inference in the impugned order that no proof of carrying out w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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