Mohan Ravi v. The Income Tax Officer,Non-Corporate Ward 20(5) Che

IN THE HIGH COURT OF JUDICATURE AT MADRAS Reserved On 17.10.2019Pronounced On 01.11.2019 CORAM THE HON'BLE DR.VINEET KOTHARI, ACTING CHIEF JUSTICEANDTHE HON'BLE MR.JUSTICE C.SARAVANAN W.A.Nos.3321 to 3324, 3327 & 3328 of 2019andC.M.P.Nos.21333, 21334, 21336 to 21339, 21342,21344, 21346, 21356 & 21358 of 2019 Mohan Ravi. .. Appellant inall W.As. Vs The Income Tax Officer,Non-Corporate Ward 20(5) CHE,121, Nungambakkam High Road,Chennai – 600 034.... Respondent inall W.As. COMMON PRAYER: Writ Appeals filed under Clause 15 of LetterPatent, to set aside the common order dated 26.08.2019 passed bythe Learned Single Judge in W.P.Nos.25239, 25242, 25241, 25244,25245 & 25248 of 2019. WP No.25239 of 2019calling for the records on the file of the Respondent in PAN . and quash the impugned notice in No.ITBA/ AST/ S /148/ 2018-19 / 1015529572(1) dated 29.03.2019 issued u/s 148 ofthe Act for the AY 2012-13 along with consequential proceedingsin C.No.ADLPR6964Q/ 2019-20/ 11 dated 31.07.2019 as illegal andwithout jurisdiction WP No.25242 of 2019calling for the records on the file of the Respondent in PAN . and quash the impugned notice in No.ITBA/ AST/ S /148/ 2018-19 / 1015529573(1)) dated 29.03.2019 issued u/s 148 ofthe Act for the AY 2013-14 along with consequential proceedingsin C.No.ADLPR6964Q/ 2019-20/7 dated 31.07.2019 as illegal andwithout jurisdiction WP No.25241 of 2019calling for the records on the file of the Respondent in PAN . and quash the impugned notice in No.ITBA/ AST/ S /148/ 2018-19 / 1015529571(1) dated 29.03.2019 issued u/s 148 ofthe Act for the AY 2013-14 along with consequential proceedingsin C.No.ADLPR6964Q/ 2019-20/9 dated 31.07.2019 as illegal andwithout jurisdiction WP No.25244 of 2019calling for the records on the file of the Respondent in PAN. and quash the impugned notice in No.ITBA/ AST/ S /148/ 2018-19 / 1015522677(1) dated 29.03.2019 issued u/s 148 ofthe Act for the AY 2015-16 along with consequential proceedingsin C.No.ADLPR6964Q/ 2019-20/6 dated 31.07.2019 as illegal andwithout jurisdiction WP No.25245 of 2019calling for the records on the file of the Respondent in PAN . and quash the impugned notice in No.ITBA/ AST/ S /148/ 2018-19 / 105522683(1) dated 29.03.2019 issued u/s 148 ofthe Act for the AY 2016-17 along with consequential proceedingsin C.No.ADLPR6964Q/ 2019-20/3 dated 31.07.2019 as illegal andwithout jurisdiction WP No.25248 of 2019calling for the records on the file of the Respondent in PAN . and quash the impugned notice in No.ITBA/ AST/ S /148/ 2018-19 / 1015522669(1) dated 29.03.2019 issued u/s 148 ofthe Act for the AY 2017-18 along with consequential proceedingsin C.No.ADLPR6964Q/ 2019-20/1 dated 31.07.2019 as illegal andwithout jurisdiction. By this common Judgment, we are disposing all the six WritAppeals. These Writ appeals are directed against the commonorder dated 26.08.2019 passed by the Learned Single Judge ofthis Court in W.P.Nos.25239, 25241, 25242, 25244, 25245 & 25248of 2019. 2.By the impugned common order, the Learned Single Judge hasdismissed the above Writ Petitions which were directed againstsix Notices all dated 29.03.2019 issued under Section 148 of theIncome Tax Act, 1961 for the Assessment Years of 2012-13 to2017-2018 to the appellant. By this common Judgment, we are disposing all the six WritAppeals. These Writ appeals are directed against the commonorder dated 26.08.2019 passed by the Learned Single Judge ofthis Court in W.P.Nos.25239, 25241, 25242, 25244, 25245 & 25248of 2019. 2.By the impugned common order, the Learned Single Judge hasdismissed the above Writ Petitions which were directed againstsix Notices all dated 29.03.2019 issued under Section 148 of theIncome Tax Act, 1961 for the Assessment Years of 2012-13 to2017-2018 to the appellant. 3.By the impugned common order, the learned single judge hasdismissed the six writ petitions with the followingobservations:-23. This Court is of the considered view thatsuch 11th hour petitions will derail assessmentsprocess under fiscal law statues. It is madeclear that this view is taken in the peculiartrajectory of this case, as the writ petitionerhas approached this Court at the 11th hourparticularly when the writ petitioner had allthe time in the world to approach this Courtearlier. As alluded to supra, these writpetitions have been filed at the 11th hour,pursuant to impugned notices II, on realizingthat the personal hearing is fixed on26.08.2019. If writ petitioner had sought anadjournment in the forenoon today and if thehearing is rescheduled, the respondent shallconsider all documents that are furnished bywrit petitioner /assessee interalia in supportof deductions claimed before completing theassessment. If such a scenario unfurls, the sameshall be done uninfluenced and untrammelled byanything that is se tou in the instant order.This answers point (c) raised by writ petitioner.4.Assailing the same, the present Writ Appeals havebeen filed. 5.Heard Mr.R.Sivaraman learned counsel for the appellant andMr.J.Narayanasamy, Senior Standing Counsel for the respondentIncome Tax Officer. 6.It is the contention of the learned counsel for theappellant that the appellant is a film actor who had filedperiodical Returns under Section 139 of the Income Tax Act,1961. 7.Thereafter, six Notices dated 29.03.2019 for the abovementioned Assessment Years were issued to the appellant contraryto be settled principle of law. It is stated that the impugnednotices did not contain any reasons for invoking the powersunder Section 148 of the Income Tax Act,1961. 8.It is further contended that the appellant also calledupon the respondent Income Tax Officer to furnish the reasonsfor reopening of the assessment, to enable the appellant to filetheir objections his objection. 9.By six separate intimations dated 26.04.2019, therespondent Income Tax Officer informed to the appellant thereasons for reopening the Assessment Years wherein it was statedthat on perusal of Return of Income Tax filed by the appellantfor the above Assessment Years during survey under Section 133 Aof the Income Tax, 1961, it was noticed that the appellant hadclaimed expenses equivalent to 59.23%, 51.10%, 38.79%, 26.71%,28.88% & 35.24% in the respective Assessment Years in question. 10.It was stated that on 18.03.2018, the appellant wascalled upon to furnish bills and invoices for all the expensesclaimed, discrepancies with income, loan agreement copies etc.However, the appellant had failed to furnish the details despitetime granted till 25.03.2019. 11.The Impugned Notices issued under Section 148 of theIncome Tax Act, 1961 were assailed by placing reliance on thedecision of the Hon’ble Supreme Court in CIT vs Kelvinator ofIndia, 320 ITR 561 wherein it was held that there must be anexistence of a tangible material to reopen an assessment, todraw a conclusion that the income escaped assessment to invokethe provisions of Section 147 of the Act. 10.It was stated that on 18.03.2018, the appellant wascalled upon to furnish bills and invoices for all the expensesclaimed, discrepancies with income, loan agreement copies etc.However, the appellant had failed to furnish the details despitetime granted till 25.03.2019. 11.The Impugned Notices issued under Section 148 of theIncome Tax Act, 1961 were assailed by placing reliance on thedecision of the Hon’ble Supreme Court in CIT vs Kelvinator ofIndia, 320 ITR 561 wherein it was held that there must be anexistence of a tangible material to reopen an assessment, todraw a conclusion that the income escaped assessment to invokethe provisions of Section 147 of the Act. 12.It was submitted that mere suspicion or surmise was notsufficient to invoke the powers vested under Section 148 of theAct. It was further stated that the notice issued also does notanywhere state income has escaped. 13.Apart from the above, the learned counsel for theappellant also relied upon the following decisions:- i. Khubchandani Health Parks (P.) Ltd., vs ITO, (2016) 68taxmann.com 91 (Bombay). ii.PCIT vs Tupperware India (P.) Ltd., (2016) 65taxmann.com 17 (Delhi). iii.CIT vs Orient Craft Ltd., (2013) 29 taxmann.com 392(Delhi). iv.Grindwell Norton Ltd., vs Jagdish Prasad Jangid,Assistant Commissioner of Income Tax & Ors, (2004) 267ITR 673 (Bom). 14.The learned counsel for the appellant further submittedthat there are no tangible materials that are available forinvoking jurisdiction under Section 147/148 of the Income TaxAct,1961. It is submitted that non furnishing of information will not ipso facto not amount to escapement of Income Tax. Itis further submitted that the Authorities concerned could havemade assessments under Section 143 (3) of the Act after duescrutiny. 15.Per contra the learned counsel for the revenueMr.Narayanaswamy submits that the reassessment proceedings arewell reasoned and require no interference and therefore praysfor dismissal of all the six Writ Appeals. 16.We have considered the records. All the six noticesissued under Section 148 of the income Tax Act, 1961 readidentically with mutatis mutandis’s changes in the date and theassessment years. The notice for the Assessment Year 2012 -13reads as under:- Notice Under Section 148 Of Tax Income Tax Act,1961 Sir/Madam/M/s, Whereas I have reasons to believe that your incomechargeable to Tax for the Assessment Year 2012-13has escaped Assessment within the meaning ofsection 147 of the Income Tax Act, 1961. I, therefore, propose to assess/re-assess theincome/loss for the said Assessment Year and Ihereby require you to deliver to me within 30 daysfrom the service of this notice, a return in theprescribed from for the said Assessment Year. This notice is being issued after obtaining thenecessary satisfaction of the PCIT/CIT 10 C 17.The assessee was separately communicated the reason forreopening vide letter dated 26.04.2019. 18.The assessee's objections thereto filed on 11.05.2019were also rejected by the Assessing Authority vide letter dated31.07.2019. 19.Under Section 148, if the assessing officer has reasonsto believe that income has escaped assessment he can issue anotice for passing order under Section 147 of the Income TaxAct, 1961. The sufficiency of those reasons cannot be gone intoby this Court. If relevant germane reasons exist and have beencommunicated to the assessee that is enough for reassessmentproceedings to hold the field. In this case, during scrutiny the appellant was further asked to furnish the details of theinvoices for the expenses incurred vide letters dated 31.07.2019However, the appellant failed to furnish the same. 18.The assessee's objections thereto filed on 11.05.2019were also rejected by the Assessing Authority vide letter dated31.07.2019. 19.Under Section 148, if the assessing officer has reasonsto believe that income has escaped assessment he can issue anotice for passing order under Section 147 of the Income TaxAct, 1961. The sufficiency of those reasons cannot be gone intoby this Court. If relevant germane reasons exist and have beencommunicated to the assessee that is enough for reassessmentproceedings to hold the field. In this case, during scrutiny the appellant was further asked to furnish the details of theinvoices for the expenses incurred vide letters dated 31.07.2019However, the appellant failed to furnish the same. 20.Therefore, it would be improper to hold that therespondent Income Tax Officer had erred in invoking thereassessment jurisdiction vested with him under Section 147/148of the Act, in the facts and circumstances case. Only when thereare no grounds at all for invoking the reassessment jurisdictionunder Section 148 of the Act, the notices can be challenged.Further, the appellant has himself replied and participated inthe impugned proceedings. The reasons were also communicated tothe appellant to which the appellant has also replied.Therefore, it is not open for the appellant to question the sameto scuttle the proceedings initiated under the Act. Therefore,we find no reasons to interfere with the order of the learnedSingle Judge while dismissing the above Writ Appeals. 21.Accordingly, all the Writ Appeals are dismissed. Nocost. Consequently, connected all Miscellaneous Petitions areclosed. -s/d- Assistant Registrar(CCC) True Copy Sub-Assistant Registrar jenToThe Income Tax Officer,Non-Corporate Ward 20(5) CHE, 121, Nungambakkam High Road, Chennai – 600 034. +6 CCS to Mr.R.Sivaraman, Advocate sr 91574 +1 CC to Mr.J.Narayanasamy, Advocate sr 90661. W.A.Nos.3321 to 3324, 3327 & 3328 of 2019andC.M.P.Nos.21333, 21334,21336 to 21339, 21342,21344, 21346, 21356 & 21358 of 2019 VSNII(CO)SP(11/12/2019)