T.v.mylsamy v. The Deputy Commissioner Of Income Tax, Central Circle-Ii

In the High Court of Judicature at MadrasDated : 29.1.2018 The Honourable Mr.Justice T.S.SIVAGNANAM Writ Petition No.27598 of 2008 & MP.No.1 of 2008 T.V.Mylsamy... Petitioner Vs 1.The Deputy Commissioner of Income Tax, Central Circle-II, 63, Race Course Road, Coimbatore-18. 2.The Assistant Commissioner of Income Tax, Central Circle-II, 63, Race Course Road, Coimbatore-18....Respondents PETITION under Article 226 of The Constitution of Indiapraying for the issuance of a Writ of Certiorari to call for therecords in PAN : AGPPM 2486B dated 19.3.2008 on the file of thesecond respondent as modified by the proceedings in PAN : dated 12.8.2008 on the file of the first respondentrelating to the assessment year 2002-03 and quash the same. Heard both. 2. The petitioner has challenged a notice issued by thesecond respondent dated 19.3.2008 under Section 148 of theIncome Tax Act, 1961 stating that he had reason to believe thatthe petitioner's income, which was assessable and chargeable totax for the assessment year 2002-03, escaped assessment withinthe meaning of Section 147 of the said Act. Therefore, thesecond respondent proposed to assess/re-assess the income,recompute the loss/depreciation allowance for the relevantassessment year and called upon the petitioner to file theirreturns within 30 days from the date of service of the saidnotice. https://hcservices.ecourts.gov.in/hcservices/ 3. The learned counsel for the petitioner submits that theinherent defect, which has been committed by the firstrespondent, is that the reasons for reopening were not furnishedto the petitioner despite making a request by letter dated13.11.2008. 4. However, this Court finds that in the interregnum i.e.after the impugned notice has been issued, there has been somecorrespondence between the petitioner and the Department. Thepetitioner appears to have acquired some knowledge, though notofficially, as to what could have been the reasons forreopening, which prompted the petitioner to send the letterdated 06.6.2008 objecting to the reopening proceedings. Inresponse to the said letter, the first respondent sent a replydated 12.8.2008 calling upon the petitioner to file their returnof income. 5. Once again, another letter of the even date was sent bythe first respondent to the petitioner calling upon theobjections for the proposal under Section 144 of the said Actfor the assessment year 2002-03. Only at that point of time, thepetitioner realized that he requires reasons for reopening.Therefore, the petitioner sent the letter dated 13.11.2008objecting to the proposal, requesting to complete the re-assessment under Section 144 of the said Act and submitting thatthe returns filed on 07.1.2003 may be treated as a response tothe notice under Section 148 of the said Act for the assessmentyear 2002-03 and simultaneously requested to furnish the reasonsfor reopening the assessment. 6. The Revenue sought to support their stand by filing acounter thereby submitting that the petitioner has alreadysubmitted their returns dated 07.1.2003, which were dealt withand a reply was given to the petitioner and at that stage, thechallenge to the impugned notice under Section 148 of the saidAct cannot be entertained. 6. The Revenue sought to support their stand by filing acounter thereby submitting that the petitioner has alreadysubmitted their returns dated 07.1.2003, which were dealt withand a reply was given to the petitioner and at that stage, thechallenge to the impugned notice under Section 148 of the saidAct cannot be entertained. 7. The mandate, as laid down by the Hon'ble Supreme Court inthe case of GKM Driveshafts (India) Ltd. Vs. ITO [reported in(2003) 259 ITR 19], requires that when an assessee seeks reasonsfor reopening the assessment, the Assessing Officer is bound tofurnish the same. On receipt of the reasons, the assessee isentitled to submit their objections, which should be consideredand a speaking order should be passed. The reasons cannot beinferred from the reply given by the Assessing Officer dated12.8.2008. The reasons for reopening should find a place in thefiles of the Assessing Officer for the relevant assessment yearand those reasons need to be communicated to the assessee so asto enable them to file their objections to the reopening https://hcservices.ecourts.gov.in/hcservices/ proceedings. Therefore, this Court is of the considered viewthat the reply sent by the Assessing Officer on 12.8.2008 is oflittle avail. Even assuming that the assessee had partialknowledge of the reasons for reopening the assessment, thatwould not be sufficient compliance of the mandate in the lightof the decision in the case of GKN Driveshafts (India) Ltd. 8. Accordingly, the writ petition is disposed of with thefollowing directions : (i) The first respondent shall consider the request of thepetitioner for furnishing the reasons for reopening theassessment for the year 2002-03 within a period of 15 days fromthe date of receipt of a copy of this order. (ii) On furnishing of such reasons for reopening, thepetitioner is directed to file their objections/reply, within 30days thereafter, after which, the first respondent shallconsider and redo the assessment by following the mandate laiddown in GKN Driveshafts (India) Ltd. (iii) It is made clear that neither party shall takeadvantage of the fact that the writ petition has been pendingfrom 2008 onwards till date. It is needless to state that it isopen to the assessee to raise all the grounds while submittingtheir objections to the reasons for reopening the assessment onbeing furnished by the Assessing Officer. No costs. Consequently, the connected MP is closed. Sd/- Deputy Registrar //True Copy// Sub Assistant Registrar rs To 1.The Deputy Commissioner of Income Tax, Central Circle-II, 63,Race Course Road, Coimbatore-18. 2.The Assistant Commissioner of Income Tax, Central Circle-II,63Race Course Road, Coimbatore-18. +1cc to Mr.N.Muthukumar, Advocate, S.R.No.6865 +1cc to Mr.A.P.Srinivas, Advocate, S.R.No.6433 RRK(13/02/2018) WP.No.27598 of 2008 and MP.No.1 of 2008