2004 (5) TMI 47 - HC - Income Tax

Legality and and validity of the impugned notices u/s 148 - competent authority has recorded the reasons for initiating the proceedings after taking into consideration the sworn statement given by the petitioner before the competent authority - petitioner himself has appeared before the competent authority and stated on oath that he has sold 56 plots from 1984 to 1996 after forming layout. But he has come up before this court taking a specific ground that the proceedings initiated and the notices issued by the respondent without assigning any reasons were without jurisdiction. The said submission and the specific ground taken by the petitioner in these petitions are contrary to the materials on record. Therefore on the ground of suppression of material facts also the writ petitions are liable to be dismissed

Summary

Issues Involved:
1. Legality and validity of the impugned notices issued under Section 148 of the Income-tax Act, 1961.
2. Compliance with mandatory provisions of Section 148 of the Income-tax Act.
3. Suppression of material facts by the petitioner.

Issue-wise Detailed Analysis:

1. Legality and Validity of the Impugned Notices:
The petitioner challenged the legality and validity of the notices dated October 17, 2000, under Section 148 of the Income-tax Act, 1961, alleging that the income for the assessment years 1998-1999 and 1999-2000 had escaped assessment. The petitioner argued that the notices were issued without assigning any reasons, making them arbitrary and illegal. The petitioner relied on various judgments to assert that the Assessing Officer must record and disclose reasons for reopening the case.

2. Compliance with Mandatory Provisions of Section 148:
The respondent contended that the notices were issued in strict compliance with the mandatory provisions of the Income-tax Act. The respondent argued that the petitioner had admitted to selling 56 plots between 1986 and 1996 and had not disclosed this income, leading to the issuance of the notices. The respondent presented original records showing that reasons for issuing the notices were recorded on October 17, 2000. The court found that the respondent had not committed any error or illegality in issuing the notices and had complied with Section 148.

3. Suppression of Material Facts by the Petitioner:
The court noted that the petitioner had appeared before the assessing authority on August 16, 2000, and admitted to selling plots, but had not mentioned this in the writ petitions. The court emphasized that the petitioner must approach the court with clean hands and disclose all material facts. The court found that the petitioner had intentionally suppressed material facts, making the writ petitions liable to be dismissed on this ground as well.

Conclusion:
The court dismissed the writ petitions with costs of Rs. 2,000, payable by the petitioner to the respondent within three weeks. The court held that the respondent had issued the notices in compliance with Section 148 of the Income-tax Act and that the petitioner had suppressed material facts. The court also noted that the petitioner could seek redress before the competent authority as permissible under the Income-tax Act.