MOHAMMAD MOINUDDIN HUSSAIN Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THE petitioner seeks a writ of Prohibition directing the respondent from proceeding further with the re-assessment proceedings initiated by him under Section 148 of the Income Tax Act (for short 'the Act') in respect of the assessment year 1981-82 pursuant to the notice dated 29-3-1989. It is seen from the counter-affidavit filed that the reasons were recorded in the file. It is clarified in the counter that the reassessment is referable to Section 147 (a) of the Act. It is stated in the counter-affidavit that the petitioner failed to disclose the material facts as regards the fair market value of the land as on 1-1-1964 in the course of assessment proceedings under the Act for the year 1981-82 which resulted in under assessment of "capital gains". THE suppression or failure to disclose the material facts has arisen, according to the department, on account of the fact that the petitioner claimed a fair market value as on 1-1-1964 as the land which was sold during the assessment year 1981-82 at much less than what was shown in the wealth tax return for the year 1978-79. It is also the case of the Department that in the returns filed, the petitioner failed to disclose that he was subjected to wealth tax in respect of the same item of property. It is on this premise the proceedings were sought to be reopened under Section 147 read with Section 148 of the Act. This Court stayed the further proceedings.

(2.) RELYING on the decision of this Court in Commr. of Inc-Tax vs. JeskaranBhuvalka and of the Supreme Court in Gemini Leather Stores vs. I.T.O. (S.C.). learned Counsel for the petitioner submits that the petitioner disclosed all the primary facts necessary to make assessment under the Act and there was no suppression or non-disclosure of facts at all. It is contended that the assessee was under no obligation to disclose about the previous wealth tax assessment. We are of the view that the contention of the petitioner is at least debatable and the explanation put forward by him has to be decided by the assessing and appellate authorities under the Act. Whether or not in the circumstances of the case, the omission to divulge about the previous year's wealth tax assessment and the valuation that he gave in the previous proceedings amounts to non-disclosure of material facts within the meaning of Sec. 147(a) of the Act is a matter which ought to be more appropriately decided by the assessing and appellate authority under the Act. As we observed earlier, there is scope for argument and scope for a further probe. We cannot say that there is not even a prima facie case to proceed under Secs. 147 and 148. We do not, therefore, think that these are fit cases to exercise jurisdiction under Article 226 of the Constitution of India to stop the proceedings under Sections 147 and 148 of the Act at the threshold. The ratio of the decisions cited by the learned Counsel do not come to the rescue of the petitioner having regard to the view taken by us. Even on the application of the dicta laid down therein, we are unable to say that the case is such which merits interference under Article 226 of the Constitution of India against the notice issued. It is open to the petitioner to raise all the objections to the proposed re-assessment before the assessing authority. We, therefore, see no merit in the writ petitions and they are dismissed with costs quantified at Rs. 500-00 in each case.