Dinesh Kumar v. Order

D.B. Civil Writ Petition No. 6407/2023 Dinesh Kumar S/o Shri Hari Ram, Resident Of VillageHardayalpura, Piprali, Distt. Sikar-332027 (Rajasthan) ----Petitioner Versus 1. The Deputy Commissioner Of Income Tax, (InternationalTaxation) Room No. 413, 4Th Floor, Jeevan Nidhi-2, LicBuilding, Ambedkar Circle, Jaipur-302005 (Rajasthan)Taxation) Room No. 413, 4Th Floor, Jeevan Nidhi-2, LicBuilding, Ambedkar Circle, Jaipur-302005 (Rajasthan) 2. Commissioner Of Income Tax (International Taxation),Delhi-I, 3Rd Floor, Room No. 317, E-2, Block, Dr. S.p.Mukherjee Civic Centre, Minto Road, New Delhi-110002Delhi-I, 3Rd Floor, Room No. 317, E-2, Block, Dr. S.p.Mukherjee Civic Centre, Minto Road, New Delhi-110002 ----Respondents For Petitioner(s) : Mr. Shafi Mohammad ChouhanFor Respondent(s): Mr. Shantanu Sharma withMr. Parth VahishthaFor Respondent(s): Mr. Shantanu Sharma withMr. Parth Vahishtha HON'BLE MR. JUSTICE AVNEESH JHINGAN HON'BLE MR. JUSTICE UMA SHANKER VYAS Order 04/11/2024 -AVNEESH JHINGAN, J(Oral): 1.This petition is filed seeking quashing of the order dated07.04.2023 passed under Section 148A(d) of the Income Tax Act,1961 (for short “the Act”). 2.The brief facts are that the petitioner filed income tax returnpertaining to assessment year 2019-2020. A notice dated20.03.2023 was issued under Section 148A of the Act on the basisof information available in form 26AS/AIR of purchase of animmovable property during the assessment year 2019-2020. Thepetitioner responded to the notice by stating that no property waspurchased by the petitioner during the relevant year, the information in form 26AS/AIR was wrong and not relating to thepetitioner. The material relied upon by the Department vis-a-visthe purchase of immovable property by the petitioner was soughtto enable the petitioner to file the reply. The order under Section148A(d) of the Act dated 07.04.2023 was passed holding it a fitcase for issuance of notice under Section 148 of the Act. 3.Learned counsel for the petitioner submits that the reply filedby the petitioner was not considered, the document and thematerial available with the Department have not been supplied.The impugned order was passed mechanically and in Para-3 it wasstated that no reply was filed by the petitioner whereas, it is anadmitted case that the reply was filed. 4.Learned counsel for the respondent submits that on the basisof information available with the Department, notice was issued. 5.The issue is whether the procedure prescribed under Section148A of the Act has been followed in the present case. In otherwords, the A.O. while passing the impugned order has consideredthe material on record, the replies filed and passed a speakingorder. 6.By Finance Act, 2021, Sections 147 to 151 of the Act weresubstituted. Section 148A of the Act was inserted streamlining theprocedure for initiation of proceedings under Section 148 of theAct. 7.The Central Board of Direct Taxes (for short ‘CBDT’) after thedecision in Union of India Vs. Ashish Agarwal (supra) on01/08/2022 issued guidelines for issuance of notice under Section148 of the Act. 4.Learned counsel for the respondent submits that on the basisof information available with the Department, notice was issued. 5.The issue is whether the procedure prescribed under Section148A of the Act has been followed in the present case. In otherwords, the A.O. while passing the impugned order has consideredthe material on record, the replies filed and passed a speakingorder. 6.By Finance Act, 2021, Sections 147 to 151 of the Act weresubstituted. Section 148A of the Act was inserted streamlining theprocedure for initiation of proceedings under Section 148 of theAct. 7.The Central Board of Direct Taxes (for short ‘CBDT’) after thedecision in Union of India Vs. Ashish Agarwal (supra) on01/08/2022 issued guidelines for issuance of notice under Section148 of the Act. 8.From the language of Section 148A of the Act and theguidelines, it is clear that before initiating the proceedings underSection 148 of the Act, with prior approval of the specifiedauthority, the A.O. if so, required may conduct an enquiry withregard to the information suggesting escaped assessment. Theassessee is to be provided an opportunity of hearing by issuingnotice specifying the date of not less than sevem days but notexceeding thirty days, which may be extended on application. Theinformation relied upon for reassessment and outcome of enquiryif conducted any, is to be supplied. In case of information havingbeen received from investigating wing or other agency, briefsummary of information along with relevant portion of report anddetails of documents relied upon is to be supplied. The decision asto if it is a fit case for issuance of notice under Section 148 is to betaken with prior approval of the specified authority, on the basis ofmaterial available on record and considering the reply filed by theassessee. The order is to be passed within one month from endingof the month when reply was filed and in case no reply was filedwithin one month from end of month when time to file replyexpires. 9.The proviso to Section 148A of the Act provides exception tothe applicability of Section 148A of the Act. 10.In the guidelines, enclosures obligate the Assessing Officerto enclose copy of the relevant information being relied upon alongwith the supported documents, if any. 11.In the case in hand while passing the order under Section148A(d), it was recorded that the petitioner has not filed reply to the show-cause notice (for short 'SCN'), though it is admitted casethat the reply was filed. The conclusion arrived at was that theassessee has not furnished the requisite details and supportingdocuments in pursuance to the SCN and it was presumed that thepetitioner had no details or explanation to offer in respect of theinformation with the Department. 12.It was not considered that there was denial by the petitionerof transaction-in-question and the copy of form 26AS/AIR wasenclosed to show that there was no transaction by the assessee ofpurchase of immovable property during the relevant assessmentyear. 13.Without considering the reply and providing the materialavailable with the Department, the impugned order was passed.The order being in violation of the procedure prescribed underSection 148A of the Act and guidelines dated 01.08.2022, is setaside and the matter is remitted back to the respondent No.1 toproceed in pursuance to SCN in accordance with law. 14.The writ petition is allowed. (UMA SHANKER VYAS),J (AVNEESH JHINGAN),J Riya/Sachin/90 Whether Reportable: Yes