Wa/2/2024 Of K. Abdul Majeed v. The Income Tax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAMPRESENT THE HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR & THE HONOURABLE MR. JUSTICE SYAM KUMAR V.M.FRIDAY, THE 5 DAY OF APRIL 2024 / 16TH CHAITHRA, 1946 WA NO. 2 OF 2024 AGAINST THE ORDER/JUDGMENT DATED IN WP(C) NO.14993 OF 2023OF HIGH COURT OF KERALAAPPELLANT K. ABDUL MAJEED,AGED 46 YEARSS/O.K.MOHAMMED, KAMBRATH HOUSE, KALPAKACHERI, RANDATHANI, MALAPPURAM DISTRICT. REPRESENTED BY HIS POWER OF ATTORNEY HOLDER, PRASAD THOTTIYIL, AGED 33 YEARS, S/O.VELAYUDHAN THOTTIYIL,RESIDING AT THOTTIYIL HOUSE, KODAKKALINGAL, CHULLIPARA P.O., TIRURANGADI, MALAPPURAM DISTRICT, PIN – 676510 BY ADVS.K.J.ABRAHAMPREMJIT NAGENDRANNIKHIL JOHN RESPONDENT/RESPONDENT: THE INCOME TAX OFFICER,CHEMBRA, TIRUR, MALAPPURAM DISTRICT, PIN – 676101 WARD-2, 2ND FLOOR, TARIFF BAZAR, OPP. TOWN HALL, BY ADVS.P.G.JAYASHANKARG.KEERTHIVAS THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON05.04.2024, THE COURT ON THE SAME DAY DELIVERED THEFOLLOWING: JUDGMENT Dr. A.K.Jayasankaran Nambiar, J. This writ appeal is preferred against the judgment dated21.12.2023 of the learned Single Judge in W.P(C) No.14993 of 2023.In the writ petition, Exts.P6 and P7 orders that were passed underSection 148(A)(d) of the Income Tax Act (hereinafter referred to asthe 'I.T.Act'), in respect of assessment years 2016-2017 and 2019-2020 respectively, were impugned. The said orders recorded thesatisfaction of the Income Tax Authority, that the case of theappellant was a fit one for issuance of notice under Section 148 of theI.T.Act for reassessment of the income of the appellant for thoseyears. 2. The ground urged in the writ petition was that theappellant was not heard in person before passing Exts.P6 and P7orders. The learned Single Judge found force in the said contention ofthe appellant and quashed Exts.P6 and P7 orders and remanded thematter back to the respondent with a direction to provide anopportunity of hearing to the appellant, and pass fresh orders underSection 148(A)(d) of the I.T.Act. 3. In the appeal before us, it is the submission of the learnedcounsel for the appellant that Exts.P6 and P7 orders recording thesatisfaction of the assessing authority that the case against theappellant was a fit one for re-opening the assessment under Section147 of the I.T.Act, was based on certain deposits made in three bankaccounts that belonged to third persons, and which the departmentbelieved were paid into the said accounts by the appellant. It is thespecific case of the appellant that he has nothing to do with the saidbank accounts and that the money did not belong to him at any stage. 4. When the appeal came up for admission, we had issuednotice before admission on 05.01.2024 and stayed furtherproceedings pursuant to the impugned judgment as against theappellant. Thereafter, when fresh reassessment proceedings wereinitiated on the same ground for the assessment year 2020-2021, wehad, by our order dated 21.03.2024, granted an interim stay offurther proceedings pursuant to Annexure A, pending disposal of thewrit appeal. We had also directed the respondent to file an affidavit,stating the action if any, initiated against the account holders of thebank accounts in which the amounts referred to above had beendeposited. By an affidavit filed on 01.04.2024, it is stated that thesaid deposits made in the bank accounts referred above, have beentreated as the unexplained investment of Mr.Rejilal, Sajilal andPankajam under Section 69 of the I.T.Act. If that be the case, then we fail to understand how proceedings under Section 148 can becontinued against the appellant herein, more so when the assessmentcompleted against the aforesaid Rejilal, Sajilal and Pankajam is not aprotective assessment. We are therefore of the view that this writappeal has to be allowed, by setting aside the impugned judgment ofthe learned Single Judge to the extent it remands the matter back tothe respondent for passing fresh orders under Section 148(A)(d) ofthe I.T.Act. In the result, the writ appeal is allowed and the writ petition isalso allowed unconditionally by quashing Exts.P6 and P7 orders thatwere impugned therein. Needless to say, the consequential ordersnamely, Exts.P8 and P9 produced in the writ petition and AnnexuresA and B produced through I.A Nos.1 and 3 of 2024 in the WritAppeal shall also stand quashed. Sd/- DR. A.K.JAYASANKARAN NAMBIAR JUDGE Sd/- SYAM KUMAR V.M. JUDGE smm APPENDIX OF WA 2/2024 PETITIONER ANNEXURES Annexure ATRUECOPYOFTHENOTICENO:ITBA/AST/F/148A(SCN)/2023-24/1062849475(1) DATED 18.03.2024ISSUED BY THE RESPONDENT FOR THEASSESSMENT YEAR 2020-21Annexure-BTRUECOPYOFTHENOTICENO:ITBA/AST/F/148A(SCN)/2023-24/1063075024(1) DATED 21.03.2024ISSUED BY THE RESPONDENT FOR THEASSESSMENT YEAR 2017-18 .