Mahananda Enterprise Limited v. Income Tax Officer, Ward 1(1)(3

IN THE HIGH COURT OF GUJARAT AT AHMEDABADR/SPECIAL CIVIL APPLICATION NO. 8208 of 2022 ========================================================== MAHANANDA ENTERPRISE LIMITED VersusINCOME TAX OFFICER, WARD 1(1)(3) ==========================================================Appearance: MR MANISH J SHAH(1320) for the Petitioner(s) No. 1MS KALPANA RAVAL, ADVOCATE for the RespondentDS AFF.NOT FILED (N) for the Respondent(s) No. 1 ========================================================== CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALAand HONOURABLE MS. JUSTICE NISHA M. THAKORE Date : 02/05/2022 ORAL ORDER (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1By this writ application under Article 226 of the Constitution ofIndia, the writ applicant has prayed for the following reliefs: “A) This Hon’ble Court be pleased to call for the records of theproceedings, look into them and be pleased to issue a writ of certiorarior any other appropriate writ, order or direction quashing of theimpugned order passed u/s. 148A(d) dated 31.03.2022 at Annexure-Dand notice issued u/s. 148 dated 31.03.2022 at Annexure-E. B) This Hon’ble Court be pleased to issue a writ of mandamus or anyother appropriate writ, order or direction asking the respondent not toproceed further in pursuance of Section 148 notice at Annexure-E. C) Pending the hearing and final disposal of this application, thisHon’ble Court be pleased to stay any further proceedings in pursuanceof Section 148 notice at Annexure-E. D) This Hon’ble Court be pleased to grant any further or other relief asthis Hon’ble Court deems just and proper in the interest of justice, and E) This Hon’ble Court be pleased to allow this application with costs against the respondent.” 2We have heard Mr. Manish J. Shah, the learned counsel appearingfor the writ applicant and Ms. Kalpana Raval, the learned SeniorStanding Counsel appearing for the Revenue. 3On 26[th] April 2022, this Court passed the following order: “1. Draft amendment is allowed. The necessary incorporation shall becarried out at the earliest. 2. We have heard Mr. Manish Shah, the learned counsel appearing forthe writ-applicant [assessee] and Mrs. Kalpana Raval, the learnedsenior standing counsel appearing for the revenue. 3. The subject matter of challenge in the present writ-application is theorder passed under Section-148A(d) of the Income Tax Act, 1961 [forshort ‘The Act, 1961’] dated 31.03.2022. The Assessing Officer isseeking to reopen the assessment for the A.Y. 2018-19. The noticeissued under Sub-section-(b) of Section-148A is essentially on theground that the Assessing Officer is in receipt of an information that theassessee i.e.the writ-applicant is a beneficiary to an amount of Rs.25Lakh received through the Canara Bank Account No.344201700206from one Subham Sales Pvt. Ltd., managed and operated by MukeshBanka. Who is Mukesh Banka? 4. According to the Assessing Officer, a search and seizure action in thecase of Banka Group was conducted on 21.05.2018. The incriminatingmaterials collected during the search and survey action revealed thatMukesh Banka was managing paper/shell companies and was knownfor providing accommodation entries in the nature of bogus unsecuredloans or in other forms. 5. Prima-facie, it appears that Subham Sales Pvt. Ltd. is also one of theshell companies controlled and managed by Mukesh Banka. In responseto the notice issued under Clause-(b) of Section-148A, the writ-applicant filed its reply outright denying any such transaction withSubham Sales Pvt. Ltd. The reply was considered and while passing theorder under Sub-section-(d) of Section-148A, the Assessing Officerreiterated in so-many words that he is in receipt of a specificinformation that the writ-applicant is a beneficiary of an amount ofRs.25 Lakh from Canara Bank Account No.344201700206 fromSubham Sales Pvt. Ltd. managed and operated by Mr. Mukesh Banka. 5. Prima-facie, it appears that Subham Sales Pvt. Ltd. is also one of theshell companies controlled and managed by Mukesh Banka. In responseto the notice issued under Clause-(b) of Section-148A, the writ-applicant filed its reply outright denying any such transaction withSubham Sales Pvt. Ltd. The reply was considered and while passing theorder under Sub-section-(d) of Section-148A, the Assessing Officerreiterated in so-many words that he is in receipt of a specificinformation that the writ-applicant is a beneficiary of an amount ofRs.25 Lakh from Canara Bank Account No.344201700206 fromSubham Sales Pvt. Ltd. managed and operated by Mr. Mukesh Banka. 6. The fine argument canvassed by Mr. Shah is that the AssessingOfficer might be in receipt of such information, however, it is notnecessary that such information is always true. The information thatmight have been received by the Assessing Officer, may be even falseand incorrect. Mr. Shah would submit that once the assessee makeshimself clear that the information received is incorrect and thetransaction, which has been shown infact does not exist on record, thenthe Assessing Officer in accordance with the new procedure underSection-148A is obliged to substantiate his case by adducing furthermaterials to the assessee and only thereafter proceed to issue the noticeunder Section-148A of the Act. 7. To appreciate this fine argument of Mr. Shah the first thing weshould do is to request Mr. Raval to call for the record and show to uswhat is the exact information. 8. Perhaps even this may not suffice. When the Assessing Officer is soclear about the bank account number maintained with Canara Bankand is also so sure about the exact amount, it is easy from the record toverify whether there is any such transaction in the bank account of theassessee with respect to Subham Sales Pvt. Ltd. for the amount of Rs.25Lakh. If this much is pointed to us that should be the end of the matter. 9. So far as the argument of Mr. Shah as regards the new procedure,which is now to be adopted is concerned, will be appreciated in light ofthe material that Mr. Raval may show to us. 10. Issue Notice to the respondent, returnable on 28.04.2022. We request Mr. Raval to act little promptly and call for thenecessary details. Notify this matter on top of the board. One set of the entire paper-book shall be furnished to Mrs.Kalpana Raval at the earliest. 11. It goes without saying that any information must be substantiatedon the basis of the record available. If any information is notsubstantiated with anything on paper, then perhaps the AssessingOfficer may not be justified in just randomly issuing such notice.Therefore, tomorrow if the Assessing Officer is not able to substantiatethe information on the basis of any record in writing in the form of abank statement itself, then we may make appropriate observation as tohow the Assessing Officer is expected to proceed in accordance withlaw. Direct service permitted.” 4Today, when the matter was taken up for further hearing, Ms.Raval, the learned Senior Standing Counsel appearing for the Revenuepointed out that the verification of the original records revealed that thealleged transaction had occurred in a different assessment year and notrelevant the assessment year for which the notice under Section 148Ahas been issued. 5In view of the aforesaid, the impugned notice issued by theAssessing Officer deserves to be quashed and set aside. The same is,accordingly, quashed and set aside. If the Revenue wants to reopen theassessment for any other relevant assessment year and if permissible inlaw, it may do so in accordance with law. 6With the aforesaid, this writ application stands disposed of. (J. B. PARDIWALA, J) CHANDRESH (NISHA M. THAKORE,J)