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TMI Blog2024 (10) TMI 1282X X X X Extracts X X X X X X X X Extracts X X X X ..... een heard at the admission stage without calling for the affidavits, and is being decided as under. (2) For convenience, reference to the facts of the Special Civil Application No.13198 of 2024 would suffice. The petitioner herein is a Limited Liability Partnership registered under the Limited Liability Partnership Act' 2008 and is running professional services / consultancy / advisory in the field of Chartered Accountancy. It is stated in the writ petition that the petitioner had filed original Return of income under Section 139 of the Act' 1961 on 14.03.2022 and further Return of income was filed on 30.05.2024 for the A.Y. 2021 - 2022, declaring its income in response to the notice under Section 148 of the Act' 1961. The copy of the acknowledgment of Return of income and Computation of income for A.Y. 2021 - 2022 is appended as Annexure - B to the writ petition. (3) The sole ground to challenge the impugned notice under Section 148 of the Act' 1961 is that the said notice has been issued by the Jurisdictional Assessing Officer (JAO) in violation of Section 151A of the Act' 1961, as has been inserted by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernment hereby makes the following Scheme, namely:- Short title and commencement 1. (1) This Scheme may be called the e-Assessment of Income Escaping Assessment Scheme, 2022, (2) It shall come into force with effect from the date of its publication in the Official Gazette. Definitions 2. (1) In this Scheme, unless the context otherwise requires, (a) "Act" means the Income-tax Act, 1961 (43 of 1961); (b) "automated allocation" means an algorithm for randomised allocation of cases, by using suitable technological tools, including artificial intelligence and machine learning, with a view to optimise the use of resources. (2) Words and expressions used herein and not defined, but defined in the Act, shall have the meaning respectively assigned to them in the Act. Scope of the Scheme 3. For the purpose of this Scheme,- (a) assessment, reassessment or recomputation under section 147 of the Act, (b) issuance of notice under section 148 of the Act, shall be through automated allocation, in accordance with risk management strategy formulated by the Board as referred to in section 148 of the Act for issuance of notice, and in a faceless manner, to the exte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A - II (Part - I) dated 11.01.2023 "information arising out of search or survey action" was to be uploaded on CRIU / VRU. However information, which is arising out of Search and Survey cases, is not required to be uploaded on the portal (CRIU / VRU) since it does not require Risk Management Strategy and in such cases, information should not be uploaded on the portal, but it should be sent directly to the JAO for taking action under the Act. Explanation 2 of Section 148 reproduced therein is relevant to be noted hereinunder for ready reference: "Explanation 2.-For the purposes of this section, where,- (i) a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A, on or after the 1st day of April, 2021, in the case of the assessee; or (ii) a survey is conducted under section 133A, other than under sub-section (2A) [***] of that section, on or after the 1st day of April, 2021, in the case of the assessee; or (iii) 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 or requis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person concerned has omitted or failed to produce books of accounts or other documents for production of which summons or notice had been issued, or such person will not produce such books of accounts or other documents even if summons or notice is issued to him. (iv) Such person is in possession of any money, bullion, jewellery or other valuable article which represents either wholly or partly income or property which has not been or would not be disclosed. (v) Such reasons may have to be placed before the High Court in the event of a challenge to formation of the belief of the competent authority in which event the Court would be entitled to examine the reasons for the formation of the belief, though not the sufficiency or adequacy thereof. In other words, the Court will examine whether the reasons recorded are actuated by mala fides or on a mere pretence and that no extraneous or irrelevant material has been considered. (vi) Such reasons forming part of the satisfaction note are to satisfy the judicial consciousness of the Court and any part of such satisfaction note is not to be made part of the order. (vii) The question as to whether such reasons are adequate or no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... administrative in character, but in the event of a challenge to the affirmation of the belief of the competent authority, the Court would be entitled to examine the reasons for affirmation of the belief, that whether the reasons recorded are actuated by mala fides or on a mere pretence or that no extraneous or irrelevant material has been considered. Though, such reasons affirming part of the Satisfaction Note are not to satisfy the judicial consciousness of the Court. (17) The said inquiry, within the jurisdiction of the Court, is necessary to arrive at the conclusion that the Jurisdictional Assessing Officer is not guided by any extraneous or irrelevant consideration and his action is honest and bona fide. (18) The submission is that pre-requisite conditions before issuance of notice under Section 148, as provided in Explanation 2 of Section 148 would require human application of mind and cannot be fulfilled by algorithm. Moreover, the concept of automated allocation in accordance with the Risk Management Strategy formulated by the Board, as referred to in Explanation 1 to Section 148 of the Act' 1961 for issuance of notice in a faceless manner, is not applicable in a case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y is furnished, within one month from the end of the month in which time or extended time allowed to furnish a reply as per clause (b) expires: Provided that the provisions of this section shall not apply in a case where,- (a) a search is initiated under section 132 or books of account, other documents 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; or (d) the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 90 or section 90A of the Act; or (iv) any information made available to the Assessing Officer under the scheme notified under section 135A; or (v) any information which requires action in consequence of the order of a Tribunal or a Court.] (23) The provisions contained in Explanation 1 shows that the information with the Assessing Officer for the purpose of Section 148, which suggests that the income chargeable to tax has escaped assessment under the Explanation would mean: (i) any information in the case of the assessee, for the relevant assessment year, in accordance with the risk management strategy formulated by the Board from time to time; or (ii) any audit objection to the effect that the assessment in the case of the assessee for the relevant assessment year has not been made in accordance with the provisions of this Act; or (iii) any information received under an agreement referred to in Section 90 or Section 90A of the Act; or (iv) any information made available to the Assessing Officer under the scheme notified under Section 135A; or (v) any information which requires action in consequence of the order of a Tribunal or a Court. On the contrary, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Act' 1961, would be attracted. (28) From the above, by reading all the relevant provisions of the Income Tax Act' 1961 as also the notification dated 29.03.2022 issued by the Central Government framing scheme for "E-Assessment of Income Escaping Assessment" under sub-sections (1) and (2) of Section 151 A of the Act' 1961, we reach at an irresistible conclusion that the challenge to the notice under Section 148 dated 22.03.2024 for A.Y. 2021-2022 on the sole premise that the said notice could have been issued only through automated allocation in faceless manner and not by Jurisdictional Assessing Officer (JAO), cannot be sustained. (29) The submission of the learned counsel for the petitioner that the Jurisdictional Assessing Officer (JAO) was not competent to issue the impugned notice under Section 148 in a case of Search and Seizure under Section 132 of the Act' 1961, are not convincing. (30) Moreover, Section 151A contemplates framing of the scheme by the Central Government by notification in the official Gazette, even for the purpose of issuance of notice under Section 148 in the case of re-assessment or sanction for issue of such notice under Section 151, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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