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TMI Blog2025 (3) TMI 1441X X X X Extracts X X X X X X X X Extracts X X X X ..... Year 2022-23, for which the Petitioner filed its income tax return on the department's portal on 27 July 2022. On 14 December 2022, the Petitioner received a notice, possibly generated by the CPC/Portal, raising defects in the return. This notice stated that the taxpayer, i.e. the Petitioner, had claimed gross receipt or income under the head "Profits and Gains of Business or Profession" of more than Rs.10 Crore, exceeding the threshold limit under Section 44AB of the IT Act. However, no tax audit report was filed as required under Section 44AB of the IT Act. 5. The Petitioner responded to the defects notice by pointing out that it had claimed gross receipts or income under the head of "Profits and Gains of Business or Profession" amounting to Rs.6.15 crores only, which was much less than the threshold limit of Rs.10 crores. Hence, the Petitioner submitted that there was no requirement to obtain and e-file a tax audit report. 6. The Petitioner heard nothing further in the matter for quite some time. Therefore, by communications dated 14 August 2023 and 22 August 2023, the Petitioner raised its grievances through the department's online grievance portal, requesting that its return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the guidelines issued by the ICAI can be relied upon while computing and filing returns. 13. For all the above reasons, Mr. Shah submitted that the impugned order declaring the Petitioner's return as invalid warrants interference and may be set aside. 14. Mr. Sharma, learned counsel for the Respondents- Revenue, submitted that the Petitioner has an alternate remedy under Section 264 of the IT Act to impugn the order dated 13 December 2023 made under Section 139 (9) of the IT Act. He submitted that there was no good reason why the Petitioner has not availed of such an alternate and efficacious remedy. He submitted that this Court must not entertain this Petition because the Petitioner has an alternate and efficacious remedy under Section 264 of the IT Act. 15. Without prejudice, Mr. Sharma submitted that the Petitioner was admittedly engaged in carrying on business. The write back would constitute sales, turnover or gross receipt as per Section 44AB of the Act. Accordingly, the tax audit report was essential, and in its absence, the income tax return did not fulfil the vital conditions in Section 44AB of the IT Act. Accordingly, Mr. Sharma submitted that there was no infirmity in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the two got blurred and thinned out, reaching virtually a vanishing point. The Hon'ble Supreme Court held that the face of an order passed by a quasi-judicial authority or even an administrative authority affecting the parties' rights must speak. It must not be like the "inscrutable face of a sphinx." (see Kranit Associates Private Limited and another Vs. Masood Ahmed Khan and others (2010) 9 SCC 496). 22. In Assistant Commissioner, Commercial Tax Department, Works Contract and Leasing, Kota Vs. Shukla and Brothers (2010) 4 SCC 785 the Hon'ble Supreme Court has held that a litigant has a legitimate expectation of knowing reasons to reject his claim/prayer. Only then would a party be able to challenge the order on appropriate grounds. Recording of reasons would also benefit the appellate court. As arguments bring things hidden and obscure to the light of reasons, reasoned judgment, where the law and factual matrix of the case are discussed, provides lucidity and foundation for conclusions or exercise of judicial discretion by the courts. The reason is the very life of the law. When the reason for a law once ceases, the law itself generally ceases. Such is the significance of re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered. The impugned order indeed resembles the "inscrutable face of a sphinx." 26. Therefore, based upon the violation of principles of natural justice or because the impugned order is a nonspeaking order, we could have set aside the order and remanded the matter for fresh consideration. However, our apprehension is that the CPC or the portal, which is programmed in a particular manner, may be able to do no better, even upon remand. Therefore, a remand may not solve the problem. 27. Mr Shah submitted that we should follow the decision of the Gujarat High Court in M/s. Rohtak Panipat Tolway Private Limited (supra) and hold that the accounts or the returns in the present case were consistent with the guidance note issued by ICAI. Therefore, there was no requirement for a tax audit. This exercise would involve scrutinizing the accounts and interpreting the guidance note. If each time, the return of an assessee is declared invalid by the CPC based upon the programming of the portal through its AI-generated responses, this Court is required to exercise its extraordinary jurisdiction for scrutinising the returns, profit and loss accounts and computation of income, then that would impose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Writ Petition should not be entertained. Accordingly, the Petition was disposed of, relegating the Petitioner to avail of the remedy of statutory revision under Section 264 of the Income Tax Act. 31. Mr. Sharma submitted that a revision under Section 264 of the IT Act lies against "any order" other than an order to which Section 263 applies. He submitted that the impugned order under Section 139 (9) of the IT Act was certainly revisable. Even Mr. Shah did not dispute that the impugned order under Section 139 (9) was revisable. However, he submitted that since the issue was covered by the decision of the Gujarat High Court, the Petitioner should not be relegated to the alternate remedy, and this Court should exercise its extraordinary jurisdiction and declare that the return was valid. 32. Though the Hon'ble Gujrat High Court's decision prima facie supports the Petitioner's contention, we still think that this matter would require deeper scrutiny of returns, profit and loss accounts, and other documents accompanying the income tax returns. The Commissioner exercising revisional jurisdiction under Section 264 of the IT Act can more conveniently undertake such an exercise. Even ..... X X X X Extracts X X X X X X X X Extracts X X X X
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