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TMI Blog2022 (7) TMI 285X X X X Extracts X X X X X X X X Extracts X X X X ..... its account through RTGS from Epoch Mercantile Pvt. Ltd. The petitioner submitted reply to that notice on 16/03/2022. However, the respondent then issued a notice to the petitioner under Clause (b) of Section 148-A of Income Tax Act on 22/03/2022 (Annexure P/5). The petitioner submitted its reply to this notice on 26/03/2022 and explained that the amount which was credited to his account amounting to Rs.19,20,000/- was received through RTGS from M/s Jai Dada Agrotech (P) Ltd. For purchase of shares. The petitioner disclosed the evidence from sources of funds of M/s Jai Dada Agrotech (P) Ltd. However, respondent then passed the impugned order dated 31/03/2022 and decided that after due consideration of the material available on record, the notice against the petitioner under Section 148 of Income Tax Act 1961 should be issued and resultantly a notice under Section 148 of Income Tax Act was also issued dated 31/03/2022 (Annexure P/8) which is also under challenge in the present case. 3. The main contention of the learned counsel of the petitioner is to the effect that the process of conducting an inquiry under Section 148-A of Income Tax Act is not an empty formality. On the contra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court of Madhya Pradesh in the case of H.H. Maharaja Martand Singh Ju Deo Vs. Wealth Tax Officer and Ors. reported in M.P. No.2270/1985 and submits that exercise of forming an opinion as regards issuance of notice under Section 148 of Income Tax Act is not an empty formality. On the contrary, the same requires due application of mind and thus has submitted that on the strength of the aforesaid decision the authority failed to apply its mind to the reply submitted by the petitioner to show cause notice and as such the order impugned as well as impugned notice deserve to be set aside. 5. Per contra, learned counsel for the respondent submits that the petitioner was given show cause notice before passing the order under Section 148-A of the Income Tax Act and the petitioner within a period of four days submitted its reply, therefore, the petitioner cannot challenge the notice on the ground that clear seven days time was not afforded. Learned counsel also submits that the sufficiency of material, is a decision which is required to be taken by the Assessing Officer and thus the Court cannot substitute its opinion as regards sufficiency of material. 5.1 It is also submitted by the lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts or any assets are requisitioned under section 132A in the case of the assessee on or after the 1st day of April, 2021; or (b) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner that any money, bullion, jewellery or other valuable article or thing, seized in a search under section 132 or requisitioned under section 132A, in the case of any other person on or after the 1st day of April, 2021, belongs to the assessee; or (c) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner that any books of account or documents, seized in a search under section 132 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. Explanation.-For the purposes of this section, specified authority means the specified authority referred to in section 151.". 6. We have heard rival contentions of the parties and perused the record. 7. The first notice to the petitioner under Section 148-A(a) of the Income Tax Act was issued on 15/03/2022 (Annexure P/3) . The sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the principle of waiver having responded to the show cause notice with a detailed and voluminous reply to the show cause, thus, after submission of reply, the petitioner cannot allege that the impugned notice was against the provisions incorporated in Section 148-A of the Income Tax Act. Though the petitioner has made an effort to refer to paragraph 10 of its reply while submitting that apart from merits, an objection with regard to time limit of seven days was also raised, however, while taking into consideration the elaborate reply on merit supported by the voluminous record, in our considered view, the petitioner has waived its rights to object the validity of the notice issued under Section 148-A of the Income Tax Act on the ground of having been afforded less than 7 days time to respond. 11. The contention of learned counsel for the petitioner is that since show cause notice issued under Section 148A(b) fell shot by the mandated minimum period of seven days, the entire exercise thereafter has vitiated is considered to be rejected at the very outset. Reason being that though the requirement of affording seven days clear notice to the assessee is couched in mandatory langu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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