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2016 (5) TMI 549 - HC - Income TaxReopening of assessment - ‘conversion charges’ were allowed as ‘Revenue expenditure’ in the hands of the firm that the relevant documents including the lease agreement were statedly perused, which led to have reasons to believe that taxable income in the hands of individual partners has escaped assessment - Held that:- The petitioners’ forceful contention that even if the conversion of land-use from ‘industrial’ to ‘commercial’ has increased its value manifold, such increase, at the best, amounts to accretion in the value of their capital asset and it shall get taxed at the time of transfer of their immovable property OR the equally appealing plea of the Revenue that the ‘conversion charges’ were paid by the lessee to the Chandigarh Administration, without such an obligation for and on behalf of the assessees and such payment is thus constructive receipt towards rent in their hands, are surely debatable and triable issues which deserve to be determined in accordance with the procedure contemplated under Section 143(3) of the Act. The reasons assigned by the Assessing Officer to tentatively believe that taxable income has escaped assessment cannot be brushed aside at the threshold without a fact-finding procedure, more-so when the petitioners are not remediless and have got equally efficacious recourses under the Act. A somewhat similar dictum is discernible from CIT vs. Chhabil Dass Agarwal (2013 (8) TMI 458 - SUPREME COURT) as it holds that the Act provides complete machinery for the assessment/reassessment of tax, imposition of penalty and for obtaining relief in respect of any improper orders passed by the Revenue Authorities, and the assessee could not be permitted to abandon that machinery and to invoke the jurisdiction of the High Court under Article 226 of the Constitution when he had adequate remedy open to him by an appeal to the Commissioner of Income Tax (Appeals). Having held so, it is not expedient for this Court to express its opinion on the rival submissions as it may unwittingly cause prejudice to either party. Suffice it to say that no case to quash the notice(s) issued under Section 148 read with Section 147 of the Act or the order(s) rejecting the objections, is made out at this premature stage.
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