DEEPAK MARDA Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) This petition challenges the impugned notice under sec. (u/s) 148 of the Income Tax Act, 1961 ( "Act ") dtd. 31/3/2021 and the impugned order on objection dtd. 10/6/2022 in addition to the impugned reassessment proceedings for Assessment Year (A.Y.) 2014- 15.

(2.) The petitioner was a director of Cinepolis India Pvt. Ltd., Gurgaon and was assessed to tax in Ichalkaranji, Kolhapur. In 2007 petitioner had collaborated with the Cinepolis Group to set up Cinepolis India and had acquired certain shares and irrevocable vested rights to equity in Cinepolis India. In Financial Year (F.Y.) 2013-14, the petitioner transferred the equity shares and rights in Cinepolis India for Rs.33,55,12,980.00 under a settlement agreement. The petitioner incurred an expense of Rs.1,31,87,400.00 towards lawyers, Chartered Accountants, Escrow Agents etc. for the said transaction. The petitioner filed his return of income for A.Y 2014-15 on 31/7/2014 whereby the proceeds receipt from transfer of equity shares in Cinepolis India was disclosed under the head "Capital Gains'' and claimed deduction of legal expenses under the head "Cost of Improvement ", the said return was duly processed u/s. 143(1) of the Act. On 11/7/2016 a notice was issued to the petitioner u/s. 142(1) for scrutiny in exercise of power conferred u/s. 143(2) of the Act. By responses dtd. 23/8/2013 and 24/8/2013, the petitioner submitted required information and documents with detailed explanation as regards the acquisition and transfer of equity shares in Cinepolis India. The Assessment Officer (AO) accepted the explanation and on being satisfied with the information and documents passed an order accepting the total income u/s. 143(3) of the Act.

(3.) On 31/3/2021, the petitioner was issued the impugned notice u/s. 148 of the Act to reopen the assessment AY 2014-15. The reasons recorded are as under :