TMI Blog2023 (12) TMI 651X X X X Extracts X X X X X X X X Extracts X X X X ..... y, providing an opportunity of being heard to assessee by serving him a show-cause notice, to consider the reply, if any, of the assessee to the show-cause notice and thereafter to take decision on the basis of material available on record including the reply whether or not it is a fit case to issue notice u/s148 and to pass order in this regard. Only after passing an order u/s 148A(d) notice u/s 148 is to be issued. By amending the Act of 1961 u/s 147 to 149 and 151 certain safeguards are provided to the assessee. In the case at hand, procedure as provided u/s 148A is not followed by the respondents before issuing notice u/s 148 of the Act, the notice issued u/s 148 is in violation of principle of natural justice and therefore the entire proceedings initiated of passing of an order of assessment is in violation of principle of natural justice and entire proceeding is vitiated in the eyes of law. Even the application seeking material and documents referred in the reasons were not supplied and the said application was dismissed relying upon the decision which was not applicable to the facts of the case at hand on the date of consideration of application, in view of the dictum of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x for the assessment year 2013-14 has escaped assessment. During the pendency of proceedings of reassessment, petitioner submitted an application on 02.03.2022 to the Assistant Commissioner of Income Tax (Assessing Officer) requesting to provide certified copy of the reasons recorded under Section 148(2) of the Act of 1961 along with documents, statement and investigation reports etc. referred in the reasons if any and the sanction taken under Section 151 of the Act to file submissions to completely defend the case. Application was considered and decided on 25.03.2022 and considering the decision in the case of Acorus Unitech Wireless Pvt. Ltd. vs. ACIT [(2014) 43 taxmann.com 62 (Delhi)] wherein it was held that in terms of Section 148, law only requires that information or material on which Assessing Officer records his or her satisfaction has to be communicated to assessee, without mandating disclosure of any specific document. Draft assessment order under Section 147 read with Section 144B was passed on 25.03.2022, on the same date show-cause notice was issued and thereafter the assessment order under Section 147 r/w Section 144B of the Act of 1961 was passed on 30.03.2022. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 54 of the Act of 1961 requesting for rectification of the order dated 30.03.2022 which also came to be dismissed. It is further contended that as the notice under Section 148 issued by Respondent No. 3 is in violation of the provisions under Section 148A, 148A(b) and 148A(d), without providing the information and material relied upon by the Revenue and therefore the order of assessment is in violation of principle of natural justice. The order has been passed without giving proper opportunity of hearing as the notice under Section 148 of the Act of 1961 was issued without following procedure as provided under Section 148A and the order of assessment, Annexure P-8, is in violation of principle of natural justice, hence, writ petition be allowed. 4. Mr. Ajay Kumrani, learned counsel for respondents vehemently opposed the submission of counsel for petitioner and would submit that as the assessment order is passed, the order is appealable under Section 246(A) of the Act of 1961 and therefore writ petition is not maintainable. He relied upon the decision of Hon ble Supreme Court in the case of Commissioner of Income Tax vs. Chhabil Dass Agarwal [(2013) 36 taxmann.com SC 36 (SC)] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orm and verified in the prescribed manner and setting forth such other particulars as may be prescribed; and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139: Provided that no notice under this section shall be issued unless there is information with the Assessing Officer which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the relevant assessment year and the Assessing Officer has obtained prior approval of the specified authority to issue such notice: 16 [Provided further that no such approval shall be required where the Assessing Officer, with the prior approval of the specified authority, has passed an order under clause (d) of section 148A to the effect that it is a fit case to issue a notice under this section:] 17 [Provided also that any return of income, required to be furnished by an assessee under this section and furnished beyond the period allowed shall not be deemed to be a return under section 139.] Explanation 1. For the purposes of this section and section 148A, the information with the Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... seized or requisitioned in case of any other person. Explanation 3. For the purposes of this section, specified authority means the specified authority referred to in section 151.] 148A. Conducting inquiry, providing opportunity before issue of notice under -The Assessing Officer shall, before issuing any notice under section 148, (a) conduct any enquiry, if required, with the prior approval of specified authority, with respect to the information which suggests that the income chargeable to tax has escaped assessment; (b) provide an opportunity of being heard to the assessee, 23 [***] by serving upon him a notice to show cause within such time, as may be specified in the notice, being not less than seven days and but not exceeding thirty days from the date on which such notice is issued, or such time, as may be extended by him on the basis of an application in this behalf, as to why a notice under section 148 should not be issued on the basis of information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year and results of enquiry conducted, if any, as per clause (a); (c) consider the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in his possession books of account or other documents or evidence which reveal that the income chargeable to tax, represented in the form of (i) an asset; (ii) expenditure in respect of a transaction or in relation to an event or occasion; or (iii) an entry or entries in the books of account, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more:] Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if 28 [a notice under section 148 or section 153A or section 153C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of this section or section 153A or section 153C, as the case may be], as they stood immediately before the commencement of the Finance Act, 2021: Provided further that the provisions of this subsection shall not apply in 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dingly. Explanation . For the purposes of clause (b) of this sub-section, asset shall include immovable property, being land or building or both, shares and securities, loans and advances, deposits in bank account. 31 [(1A) Notwithstanding anything contained in sub-section (1), where the income chargeable to tax represented in the form of an asset or expenditure in relation to an event or occasion of the value referred to in clause (b) of sub-section (1), has escaped the assessment and the investment in such asset or expenditure in relation to such event or occasion has been made or incurred, in more than one previous years relevant to the assessment years within the period referred to in clause (b) of sub-section (1), a notice under section 148 shall be issued for every such assessment year for assessment, reassessment or recomputation, as the case may be.] (2) The provisions of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151.] 151. Sanction for issue of notice.- Specified authority for the purposes of section 148 and section 148A shall be, (i) Principal Commissioner or Principal Director or Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 48 of the Act of 1961 can be issued. The submission of learned counsel for petitioner that no proceeding has been initiated under Section 148A before issuance of notice under Section 148 is not disputed by the respondents in their reply but in the pleadings it is mentioned that the assessment proceeding is completed on 30.03.2022 whereas the decision of Hon ble Supreme Court in the case of Ashish Agarwal (supra) was passed on 04.05.2022. 8. The amended provisions under Section 148 and 148A came into force w.e.f. 01.04.2021, notice under Section 148 was issued on 09.06.2021 without following the procedure as provided under Section 148A. Notice under Section 148 was issued after 01.04.2021 without following procedure provided under Section 148A of the Act of 1961 was put to challenge before different High Courts and the High Courts have set aside the notice under Section 148 and the order of High Court was put to challenge by the Revenue before the Supreme Court which came to be decided in case of Ashish Agarwal (supra) along with other connected matters. Even if the judgment of Hon ble Supreme Court was passed on 04.05.2022, the amended provisions under Section 148 and 148A came ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Ors. (1998) 8 SCC 11]. The present case attracts applicability of first two contingencies. Moreover, as noted, the petitioners' dealership, which is their bread and butter came to be terminated for an irrelevant and non-existent cause. In such circumstances, we feel that the appellants should have been allowed relief by the High Court itself instead of driving them to the need of initiating arbitration proceedings. 10. Recently, Hon ble Supreme Court in the case of Assistant Commissioner of Sales Tax others vs. Commercial Steel Limited [(2021) SCC OnLine SC 884 , has observed thus: 11. The respondent had a statutory remedy under section 107. Instead of availing of the remedy, the respondent instituted a petition under Article 226. The existence of an alternate remedy is not an absolute bar to the maintainability of a writ petition under Article 226 of the Constitution. But a writ petition can be entertained in exceptional circumstances where there is: (i) a breach of fundamental rights; (ii) a violation of the principles of natural justice; (iii) an excess of jurisdiction; or (iv) a challenge to the vires of the statues or deleg ..... X X X X Extracts X X X X X X X X Extracts X X X X
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