…Coram : Ravindra v. Ghuge &Y.g. Khobragade, Jj.date :14[Th] June, 2023

( 1 ) wp 10144 .22 IN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABAD WRIT PETITION NO. 10144 OF 2022 Sunil S/o Shivprasad ToshniwalAge: 54 years, Occ.: Business, R/o. Chowk Bazar, Jintur,Tq. Jintur, Dist. Parbhani.(Maharashtra State)PAN No. ...PETITIONER V/s. 1.The Principal CommissionerIncome Tax-1, NasikIncome Tax Building,Agra Road, Nashik. 2.The Income Tax Officer,Ward, Hingoli,Tq. & Dist. Hingoli.. ... RESPONDENTS ... Mr. Raviraj R. Chandak, Advocate for the PetitionerMr. Alok Sharma, Advocate for R/1 & 2 …CORAM : RAVINDRA V. GHUGE &Y.G. KHOBRAGADE, JJ.DATE :14[th] June, 2023 ORAL JUDGMENT (Per: Ravindra V. Ghuge, J.) :- 1.Rule. Rule made returnable forthwith and heard finally by the consent of the parties. 2.The issue raised in this petition is as regards the issuance of notice under Section 148-A of the Income Tax Act and in relation to assessment of anamount which has escaped assessment and a period of three years is over,coupled with the fact that the amount is less than Rs. Fifty Lakhs. 3.In the case in hand, pertaining to a country liquor retail shopdistrict Parbhani, it is an admitted position that an amount of Rs.30,30,000/-escaped assessment in the assessment year 2016-2017. The case of thedepartment is that this amount originates from an unexplained cash deposit ina bank during the de-monetisation period. 4. Since the amount at issue is undisputed, we do not intend to enlarge the size of this judgment by referring to the details thereof. It wouldsuffice the purpose by referring to Section 148, 148-A which was inserted bythe Finance Act, 2021 w.e.f. 01.04.2021 and Section 149 of the Income Tax Actwhich read as under: Section 148. Before making the assessment, reassessment orrecomputation under section 147, and subject to the provisions of section148A, the Assessing Officer shall serve on the assessee a notice, alongwith a copy of the order passed, if required, under clause (d) of section148A, requiring him to furnish within such period, as may be specified insuch notice, a return of his income or the incom of any other person inrespect of which he is assessable under this Act during the previous yearcorresponding to the relevant assessment year, in the prescribed form andverified in the prescribed manner and setting forth such other particularsas may be prescribed; and the provisions of this Act shall, so far as mayhe apply accordingly as if such return were a return required to befurnished under section 139: Provided that no notice under this section shall be issued unless there isinformation with the Assessing Officer which suggests that the incomechargeable to tax has escaped assessment in the case of the assessee forthe relevant assessment year and the Assessing Officer has obtained priorapproval of the specified authority to issue such notice. Explanation 1.- For the purposes of this section and section 148A, theinformation with the Assessing Officer which suggests that the incomechargeable to tax has escaped assessment means,- (i) any information flagged in the case of the assessee for therelevant assessment year in accordance with the risk managementstrategy formulated by the Board from time to time; (ii) any final objection raised by the Comptroller and Auditor Generalof India to the effect that the assessment in the case of the assessee forthe relevant assessment year has not been made in accordance with theprovisions of this Act. Explanation 2.-For the purposes of this section, where,- (i) a search is initiated under section 132 or books of account, otherdocuments or any assets are requisitioned under section 132A, or afterthe 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) or sub-section (5) of that section, on or after the 1st day ofApril, 2021, in the case of the assessee; or (ii) any final objection raised by the Comptroller and Auditor Generalof India to the effect that the assessment in the case of the assessee forthe relevant assessment year has not been made in accordance with theprovisions of this Act. Explanation 2.-For the purposes of this section, where,- (i) a search is initiated under section 132 or books of account, otherdocuments or any assets are requisitioned under section 132A, or afterthe 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) or sub-section (5) of that section, on or after the 1st day ofApril, 2021, in the case of the assessee; or (iii) the Assessing Officer is satisfied with the prior approval of thePrincipal Commissioner or Commissioner, that any money, bullion,jewellery or other valuable article or thing seized or requisitioned undersection 132 or section 132A in case of any other person on or after the1st day of April, 2021, belongs to the assessee; or (iv) the Assessing Officer is satisfied with the prior approval ofPrincipal Commissioner or Commissioner, that any books of account ordocu- ments, seized or requisitioned under section 132 or section 132Ain case of any other person on or after the 1st day of April, 2021, pertainsor pertain to, or any information contained therein, relate to, the assessee,the Assessing Officer shall be deemed to have information whichsuggests that the income chargeable to tax has escaped assessment in thecase of the assessee for the three assessment years immediatelypreceding the assessment year relevant to the previous year in which thesearch is initiated or books of account, other documents or any assets arerequisitioned or survey is conducted in the case of the assessee or money,bullion, jewellery or other valuable article or thing or books of accountor documents are seized or requisitioned in case of any other person. Explanation 3.-For the purposes of this section, specified authoritymeans the specified authority referred to in section 151] Conducting inquiry, providing opportunity before issue of notice undersection 148. 148A.The Assessing Officer shall, before issuing any notice undersection 148- (a) conduct any enquiry, if required, with the prior approval ofspecified authority, with respect to the information which suggests thatthe income chargeable to tax has escaped assessment; (b) provide an opportunity of being heard to the assessee, with theprior approval of specified authority, by serving upon him a notice toshow cause within such time, as may be specified in the notice, being notless than seven days and but not exceeding thirty days from the date onwhich such notice is issued, or such time, as may be extended by him onthe basis of an application in this behalf, as to why a notice under section148 should not be issued on the basis of information which suggests thatincome chargeable to tax has escaped assessment in his case for therelevant assessment year and results of enquiry conducted, if any, as perclause (a); (c) consider the reply of assessee furnished, if any, in response to theshow-cause notice referred to in clause (b); (d) decide, on the basis of material available on record includingreply of the assessee, whether or not it is a fit case to issue a notice undersection 148, by passing an order, with the prior approval of specifiedauthority within one month from the end of the month in which the replyreferred to in clause (c) is received by him, or where no such reply isfurnished within one month from the end of the month in which time orextended time allowed to furnish a reply as per clause (b) expires: Providedthat the provisions of this section shall not apply in a casewhere, (a) a search is initiated under section 132 or books of account, otherdocuments or any assets are requisitioned under section 132A in the caseof the assessee on or after the 1st day of April, 2021; or (d) decide, on the basis of material available on record includingreply of the assessee, whether or not it is a fit case to issue a notice undersection 148, by passing an order, with the prior approval of specifiedauthority within one month from the end of the month in which the replyreferred to in clause (c) is received by him, or where no such reply isfurnished within one month from the end of the month in which time orextended time allowed to furnish a reply as per clause (b) expires: Providedthat the provisions of this section shall not apply in a casewhere, (a) a search is initiated under section 132 or books of account, otherdocuments or any assets are requisitioned under section 132A in the caseof the assessee on or after the 1st day of April, 2021; or (b) the Assessing Officer is satisfied, with the prior approval of thePrincipal Commissioner or Commissioner that any money, bullion,jewellery or other valuable article or thing, seized in a search undersection 132 or requisitioned under section 132A, in the case of any otherperson 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 thePrincipal Commissioner or Commissioner that any books of account ordocuments, seized in a search under section 132 or requisitioned undersection 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, relateto, the assessee. Explanation. For the purposes of this section, specified authority meansthe specified authority referred to in section 151.] Section 149. (1) No notice under section 148 shall be issued for therelevant assessment year- (a) if three years have elapsed from the end of the relevantassessment year, unless the case falls under clause (b); (b) if three years, but not more than ten years, have elapsed from theend of the relevant assessment year unless the Assessing Officer has inhis possession books of accounts or other documents or evidence whichreveal that the income chargeable to tax, represented in the form of asset,which has escaped assessment amounts to or is likely to amount to fiftylakh rupees or more for that year: (c)if four years, but not more than sixteen years, have elapsed fromthe end of the relevant assessment year unless the income in relation toany asset (including financial interest in any entity) located outside India,chargeable to tax, has escaped assessment.” Provided that no notice under section 148 shall be issued at any time in acase for the relevant assessment year beginning on or before 1st day ofApril, 2021, if such notice could not have been issued at that time onaccount of being beyond the time limit specified under the provisions ofclause (b) of sub-section (1) of this section, as they stood immediatelybefore the commencement of the Finance Act, 2021: Provided further that the provisions of this sub-section shall not apply ina case, where a notice under section 153A, or section 153C read withsection 153A, is required to be issued in relation to a search initiatedunder section 132 or books of account, other documents or any assetsrequisitioned under section 132A, on or before the 31st day of March,2021: Provided also that for the purposes of computing the period of limitationas per this section, the time or extended time allowed to the assessee, asper show-cause notice issued under clause (b) of section 148A or theperiod during which the proceeding under section 148A is stayed by anorder or injunction of any court, shall be excluded: Provided also that where immediately after the exclusion of the periodreferred to in the immediately preceding proviso, the period of limitationavailable to the Assessing Officer for passing an order under clause (d) ofsection 148A is less than seven days, such remaining period shall beextended to seven days and the period of limitation under this sub-section shall be deemed to be extended accordingly. Provided also that for the purposes of computing the period of limitationas per this section, the time or extended time allowed to the assessee, asper show-cause notice issued under clause (b) of section 148A or theperiod during which the proceeding under section 148A is stayed by anorder or injunction of any court, shall be excluded: Provided also that where immediately after the exclusion of the periodreferred to in the immediately preceding proviso, the period of limitationavailable to the Assessing Officer for passing an order under clause (d) ofsection 148A is less than seven days, such remaining period shall beextended to seven days and the period of limitation under this sub-section shall be deemed to be extended accordingly. Explanation- For the purposes of clause (b) of this sub-section, “asset”shall include immovable property, being land or building or both, sharesand securities, loans and advances, deposits in bank account. (2)The provisions of sub-section (1) as to the issue of notice shall besubject to the provisions of section 151.] 5.Earlier, the notice under Section 148-A was an option available tothe establishment to seek assessment of such escaped amounts which werechargeable to tax. With the introduction of Section 148-A, the Hon'bleSupreme Court laid down the law vide judgment dated 04.05.2022 in CivilAppeal No.3005/2022 (Union of India and Others V/s. Ashish Agarwal) and agroup of cases, concluding that the notice under Section 148 shall initially beconstrued to mean a notice under Section 148-A. There is no dispute that thishas been done in the present case. It is equally undisputed that the impugnedorder in the case in hand has been passed under Section 148-A (d), keeping inview the law laid down by the Hon'ble Supreme Court in the case of AshishAgarwal (supra). 6.The present Petitioner has approached this Court for the reasonthat according to the establishment the amount that has escaped assessment, isRs.30,30,000/-. If this is considered in the light of Section 149(1)(b), and as ( 7 )wp 10144 .22 more than 3 years have lapsed and 10 years have not lapsed from the end ofthe relevant assessment year, assessment / re-assessment of the escapedamounts is permissible only if the escaped assessment amounts are more thanRs. Fifty Lakhs or are likely to amount to Rs. Fifty Lakhs for that particularassessment year. In the light of the impugned notice, the Petitioner hastendered two replies vide communication dated 08.06.2022 and 18.06.2022under Section 148A. It is undisputed that in the replies filed by the Petitioner,a specific objection with regard to Section 149 was not raised and, therefore,the establishment passed an order on 27.08.2022 under Section 148-A (d).Thereafter, the Petitioner has been served with a notice under Section 148-A,dated 29.07.2022. 7.There is no dispute that the Petitioner did not raise an objection asregards Section 149 to the extent of the quantum of the amount which isalleged to have escaped assessment. It is equally undisputed that after thePetitioner has received the Section 148 notice, even now such objection can beraised and the authorities can consider the same before venturing into theentire exercise of carrying out an assessment, if that would be barred by theeffect of Section 149. The learned advocate for the Petitioner submits that hewould raise such an objection forthwith. The learned advocate for the ( 8 )wp 10144 .22 department submits that a reply may be filed by the Petitioner and thisobjection touching Section 149, would be considered peremptorily. 7.There is no dispute that the Petitioner did not raise an objection asregards Section 149 to the extent of the quantum of the amount which isalleged to have escaped assessment. It is equally undisputed that after thePetitioner has received the Section 148 notice, even now such objection can beraised and the authorities can consider the same before venturing into theentire exercise of carrying out an assessment, if that would be barred by theeffect of Section 149. The learned advocate for the Petitioner submits that hewould raise such an objection forthwith. The learned advocate for the ( 8 )wp 10144 .22 department submits that a reply may be filed by the Petitioner and thisobjection touching Section 149, would be considered peremptorily. 8.In these peculiar facts and circumstances as recorded above, thispetition is disposed offwith liberty to the Petitioner to submit it’s writtenreply / objection to the impugned show cause notice in the light of Section 149on or before 30.06.2023. The department would consider the replies /objections in the light of Section 149 and pass a reasoned order. If the saidorder is adverse to the Petitioner, the same would not be brought into effectuntil fifteen days from the date of the order, so as to enable the Petitioner toavail of a remedy as may be permissible in law. Needless to state, the orderthat would be passed by the department would be uploaded on its website andwould be e-mailed to the Petitioner on its e-mail address which is registeredwith the department, on the same date of pronouncement. Needless to state, ifthere is any other mode of filing of the reply like ‘Faceless assessment’ the saidprocess can be followed. 9.Rule is discharged. [Y.G. KHOBRAGADE, J.] [RAVINDRA V. GHUGE, J.]