BHARAT KRISHI KENDRA Vs. UNION OF INDIA

JUDGEMENT

(1.) Feeling aggrieved by issuance of notice under Sec. 148 of the Income Tax Act, 1961 (for short 'the Act of 1961'), petitioner has filed this petition seeking for following relief:-

(2.) Mr. S. Rajeshwar Rao, learned counsel for petitioner would submit that respondents have started proceedings of reassessment of income tax returns submitted by petitioner for the assessment year 2017-18 without following the procedure established in this regard under the Act of 1961. Sec. 147 of the Act of 1961, as prevailing during relevant period, requires the Assessing Officer to record 'reasons to believe' for issuing notice under Sec. 148 of the Act of 1961. Perusal of notice Annexure P-1 issued under Sec. 148 of the Act of 1961 would reveal that there is no mention that authority had reason to believe for starting re-assessment process, hence notice issued to petitioner does not satisfy requirement of Sec. 147 of the Act of 1961, which is a pre-condition. In the impugned notice it is only mentioned that the assessee escaped assessment of income in returns submitted by him for the assessment year 2017-18, whereas the assessee in income-tax returns disclosed entire amount deposited in bank accounts that too within specified period i.e. from 9/11/2016 to 13/12/2016. Petitioner is having total four bank accounts in which he is depositing cash and this fact has also been disclosed to respondent Department. In income tax return, petitioner has disclosed Bank Account No. 910030017071357 maintained at Axis Bank Ltd. showing cash deposit of Rs.63,27,990.00 within prescribed period, which is separately mentioned because this is the bank in which petitioner wanted refund of tax, if any, to be deposited by respondent Department, therefore, this account has been separately shown under Column-13 of the income-tax return. In Column-13B other bank accounts which the petitioner is operating and are within records of respondent Department, are shown wherein cash deposit within prescribed period, deposit of above Rs.2.00 Lakh has been specifically mentioned. Hence, petitioner has declared entire cash deposits in his return and it cannot be said that the same has been escaped assessment. He contended that Assessing Officer has only taken cash deposits of one bank account and held that there was total cash deposit of Rs.85,45,710.00. Difference between two has been treated escaped assessment, which cannot be said to be correct in view of income tax returns submitted by petitioner.

(3.) Mrs. Naushina Afrin Ali, learned counsel for respondents vehemently opposes submissions of learned counsel for petitioner and submits that the Department has followed the procedure prescribed under the Act of 1961 as also the Standard Procedure formulated by the Department vide letter dtd. 10/1/2018. The Assessing Officer received information from the Deputy Director of Income Tax (Investigation), Raipur (for short 'DDIT') who had issued notice/summons under Sec. 133 of the Act of 1961. Mere mentioning of deposits or transactions in income tax return, which are accepted at the time of submission of income tax return, will not debar the authorities to reopen case for re-assessment. In case at hand, though petitioner has disclosed deposits in other bank accounts but did not explain source of that amount in proper manner in return and this was the basis for initiating proceeding against petitioner. The DDIT taking into consideration returns and other documents submitted, called upon petitioner to furnish details and explanation by issuing summons, which was replied by petitioner. Reply submitted was not found to be satisfactory, therefore, case was forwarded to the Assessing Officer, who based on information received from DDIT and considering the return as also the bank statement, issued notice under Sec. 148 of the Act of 1961. Petitioner finding that there is no specific mention of reasons to believe for initiating proceeding of re-assessment, submitted request letter to Assessing Officer, which was replied by Assessing Officer, along with copy of reasons recorded for opining to issue notice under Sec. 148 of the Act of 1961, which is also placed on record by petitioner from Page No. 32 onwards of writ petition. A glance of Page No. 32 of writ petition would show that after the chart showing different deposits in different banks, the Assessing Officer has mentioned that petitioner was asked to give documentary evidence and produce details in support of cash deposits made during demonetization period. Reply submitted by the petitioner was found unsatisfactory, which is also specifically mentioned, if income tax authority accepts income tax return/document without raising any question then it does not mean that at subsequent point of time, return/documents placed along with return cannot be revisited and assessee cannot be noticed. In support of aforementioned contention she places her reliance on judgment of Hon'ble Supreme Court in case of M/s. Phool Chand Bajrang Lal v. Income-Tax Officer reported in (1993) 4 SCC 77.