Wtax/561/2023 Of Deepak Kumar Yadav v. Principal Commissioner Of Income Tax And Another

AFR -Court No. 47 Case :- WRIT TAX No. - 561 of 2023 Petitioner :- Deepak Kumar YadavRespondent :- Principal Commissioner Of Income Tax And AnotherCounsel for Petitioner :- Ashish BansalCounsel for Respondent :- Gaurav Mahajan Hon'ble Ashwani Kumar Mishra,J.Hon'ble Shiv Shanker Prasad,J. 1.Petitioner is an individual who is engaged in the business oftrading of Arecanut (Supari), Chopped Betal Nut and Sweet BetalNut in the name of his proprietary concern namely “S.K.L.Enterprises”. He alleges that his Books of Account and other recordsare subject to audit under Section 44AB of the Income Tax Act, 1961(hereinafter referred to as the ‘Act of 1961’). He further claims to befiling his return year after year and has been assessed to taxaccordingly. For the Assessment Year 2019-20, the petitioner filedhis return under Section 139(1) of the Act on 26.08.2019 disclosingtotal income of Rs. 6,81,630/-. The turnover during the year fromhis proprietary concern aggregated to Rs. 5,87,26,116/- andaggregate purchases are of Rs. 5,81,61,860/-. He further assertsthat he has been assessed under Section 143(1) of the Act on thebasis of return submitted by him on 26.08.2019 and no notice hasbeen issued to him under Section 143(2) of the Act. 2.It transpires that the jurisdictional authority i.e. respondentno. 2 issued a notice to petitioner dated 16.03.2023, under Section148A(b) of the Act, 1961 accompanying the information with theassessing officer to suggest that income chargeable to tax hasescaped assessment. The substance of the informationaccompanying the notice is extracted hereinafter:- “1(A) Information was received by DDIT (Inv.), Unit-III,Nagpur from DGGI and GST authorities in the case of M/s Kuhoje KAchumi of availing and utilization of fraudulent ITC on the basis offake tax invoices without receipt of goods. The said entity did notexist at the declared principal place of business. On the basis of theNagpur from DGGI and GST authorities in the case of M/s Kuhoje KAchumi of availing and utilization of fraudulent ITC on the basis offake tax invoices without receipt of goods. The said entity did notexist at the declared principal place of business. On the basis of the above information, the Investigation Unit-III, Nagpur took upinvestigation and inferred that M/s Kuhoje K Achumi has facilitatedand is involved in both availing of fake invoices without actualsupply of goods and in turn in issuing fake invoices to otherswithout actual supply of goods. Aforesaid facts imply that theparties which have claimed to have availed purchases from M/sKuhoje K Achumi have only indulged in availing of purchaseinvoices without any actual movement of goods and by doing so,they have artificially inflated their purchase expenses and reducedtheir taxable income. You are reported as one of such suspiciouspurchasers and the purchase value in your case for F.Y. 2018-19relevant to A.Y. 2019-20 is Rs. 96,43,750/- from M/s Kuhoje KAchumi. above information, the Investigation Unit-III, Nagpur took upinvestigation and inferred that M/s Kuhoje K Achumi has facilitatedand is involved in both availing of fake invoices without actualsupply of goods and in turn in issuing fake invoices to otherswithout actual supply of goods. Aforesaid facts imply that theparties which have claimed to have availed purchases from M/sKuhoje K Achumi have only indulged in availing of purchaseinvoices without any actual movement of goods and by doing so,they have artificially inflated their purchase expenses and reducedtheir taxable income. You are reported as one of such suspiciouspurchasers and the purchase value in your case for F.Y. 2018-19relevant to A.Y. 2019-20 is Rs. 96,43,750/- from M/s Kuhoje KAchumi. (B) Similarly, Information was received by DDIT (Inv.), Unit-III, Nagpur from CBDT, in the case of M/s Om Traders (Prop. JasbirSingh Chatwal) of availing fraudulent ITC. On the basis of the aboveinformation, the Investigation Unit-III, Nagpur took up investigationand it is found that M/s Om Traders (Prop. Jasbir Singh Chatwal)has indulged in availing fake tax invoices which implies that there isno actual movement of goods to M/s Om Traders. Further, M/s OmTraders has made sales to number of entities. Since M/s OmTraders is indulged in fictitious purchases, therefore, the sales arealso fictitious as he has no goods to make sale to other entities.Therefore, the entities who have claimed to have availed purchasesfrom M/s Om Traders (Prop. Jasbir Singh Chatwal) has merelyinflated their purchase expenses by availing invoices from M/s OmTraders (Prop. Jasbir Singh Chatwal) without actual movement ofgoods. You are reported as one of such suspicious purchasers andthe purchase value in your case from F.Y. 2018-19 relevant to A.Y.2019-20 is Rs. 83,25,000/- from M/s Om Traders (Prop. JasbirSingh Chatwal). (C) In addition there is third party information which is as under:- 3.Petitioner was accordingly given an opportunity under Section148A(b) of the Act to show cause as to why a notice under Section148 of the Act be not issued to him on the basis of information whichsuggests that income chargeable to tax of Rs. 96,43,750/- + Rs.83,25,000/- + Rs. 5,10,25,000/- aggregate Rs. 6,89,93,750/- hasescaped assessment for the Assessment Year 2019-20. 4.In response to the above notice the petitioner has filed adetailed objection before the respondent no. 2 on 24.04.2023denying the allegations made in the notice. A request has also beenmade for providing the information relied upon for invoking suchproceedings as well as to provide opportunity of cross-examinationof the said suppliers. 5.The jurisdictional authority has proceeded to pass an order on29.3.2023 under Section 148(d) of the Act rejecting the petitioner’sobjection to the notice on the ground that information exists tosuggest that transactions referred to in the notice are fictitious andwithout actual supply of goods. Consequently, petitioner’s purchasesare treated as fictitious for the Financial Year 2018-19 amounting toRs. 1,79,68,750/-. This amount has been treated as having escapedassessment for the year 2019-20 for the purposes of initiatingproceeding under Section 148 of the Act. Petitioner’s request forcross-examination of suppliers and furnishing of material has beendeclined considering the time-barring nature of the matter. Aconsequential notice has also been issued to petitioner on29.03.2023, under Section 148 of the Act. Aggrieved by the orderunder Section 148A(d) of the Act, dated 29.03.2023 as well as noticeof the same date i.e. 29.3.2023 issued under Section 148 of the Act,the petitioner has approached this Court. 6.Sri Ashish Bansal for the petitioner submits that the authorityconcerned has not examined the petitioner’s reply to the notice, onmerits, and the order impugned has been passed in a routine and 6.Sri Ashish Bansal for the petitioner submits that the authorityconcerned has not examined the petitioner’s reply to the notice, onmerits, and the order impugned has been passed in a routine and mechanical manner. Learned counsel further submits that object ofissuing notice under Section 148A of the Act would stand frustrated,if the authority does not examine the reply of the assessee inresponse to the show cause notice referred to in Clause (b) andpasses an order without conducting any enquiry. It is urged that themanner in which the order has been passed renders the object ofissuing notice under Section 148A of the Act nugatory. In support ofsuch contention, counsel for the petitioner has placed reliance uponan order passed by the Supreme Court of India in Red ChilliInternational Sales Vs. Income-tax Officer reported in [2023] 146taxmann.com 224 (SC). He further places reliance upon an orderpassed by the Bombay High Court in Writ Petition No. 2836 of 2022,decided on 13.03.2023. 7.Per-contra, Sri Gaurav Mahajan appearing for the revenuesubmits that the object of issuing notice under Section 148A of theAct is limited to ascertainment of information which suggests thatincome has escaped assessment and issues such as sufficiency orotherwise of material justifying reopening of assessment oradjudication on the correctness of information are ordinarily notwarranted at this stage, in exercise of extraordinary writ jurisdiction.The limited enquiry contemplated at this stage is to ascertainexistence of information which suggests that income has escapedassessment. It is submitted that in the facts of this case suchinformation does exist on record. It is also argued that petitionerwould be at liberty to raise all factual issues/objections at theappropriate stage of the proceedings, and as no prejudice otherwiseis caused to him, this Court would not be justified in embarking uponthe correctness or otherwise of the information available with theAssessing Officer while taking decision under Section 148A(d) of theAct. 8.The scheme for re-assessment of tax under the Act of 1961has undergone a change with effect from April 1, 2021 vide FinanceAct, 2021. The requirement of ‘reasons to believe’ for initiating re- assessment proceedings hitherto occurring in the Act standssubstituted with the availability of information with the AssessingOfficer that income of assessee has escaped assessment. Amendedsections 147 and 148 of the Income Tax Act, 1961 as well as section148A introduced in the Act of 1961 vide Finance Act 2021 arereproduced hereinafter:- “147. Income escaping assessment. - If any incomechargeable to tax, in the case of an assessee, has escapedassessment for any assessment year, the Assessing Officermay, subject to the provisions of sections 148 to 153, assessor reassess such income or recompute the loss or thedepreciation allowance or any other allowance or deductionfor such assessment year (hereafter in this section and insections 148 to 153 referred to as the relevant assessmentyear). Explanation.- For the purposes of assessment orreassessment or recomputation under this section, theAssessing Officer may assess or reassess the income inrespect of any issue, which has escaped assessment, andsuch issue comes to his notice subsequently in the course ofthe proceedings under this section, irrespective of the factthat the provisions of section 148A have not been compliedwith.] Explanation.- For the purposes of assessment orreassessment or recomputation under this section, theAssessing Officer may assess or reassess the income inrespect of any issue, which has escaped assessment, andsuch issue comes to his notice subsequently in the course ofthe proceedings under this section, irrespective of the factthat the provisions of section 148A have not been compliedwith.] 148. Issue of notice where income has escapedassessment. - Before making the assessment, reassessmentor recomputation under section 147, and subject to theprovisions of section 148A, the Assessing Officer shall serveon the assessee a notice, along with a copy of the orderpassed, if required, under clause (d) of section 148A,requiring him to furnish within such period, as may bespecified in such notice, a return of his income or the incomeof any other person in respect of which he is assessableunder this Act during the previous year corresponding to therelevant assessment year, in the prescribed form and verifiedin the prescribed manner and setting forth such otherparticulars as may be prescribed; and the provisions of thisAct shall, so far as may be, apply accordingly as if suchreturn were a return required to be furnished under section139: Provided that no notice under this section shall be issuedunless there is information with the Assessing Officer whichsuggests that the income chargeable to tax has escapedassessment in the case of the assessee for the relevantassessment year and the Assessing Officer has obtained priorapproval of the specified authority to issue such notice. Provided further that no such approval shall be requiredwhere the Assessing Officer, with the prior approval of thespecified authority, has passed an order under clause (d) ofsection 148A to the effect that it is a fit case to issue a notice under this section. Explanation 1. - For the purposes of this section and section148A, the information with the Assessing Officer whichsuggests that the income chargeable to tax has escapedassessment means,- (i) any information in the case of the assessee for therelevant assessment year in accordance with the riskmanagement strategy formulated by the Board from timeto time; (ii) any audit objection to the effect that the assessmentin the case of the assessee for the relevant assessmentyear has not been made in accordance with the provisionsof this Act; or (iii) any information received under an agreement referredto in section 90 or section 90A of the Act; or (iv) any information made available to the AssessingOfficer under the scheme notified under section 135A; or (v) any information which requires action in consequenceof the order of a Tribunal or a Court. Explanation 2. - For the purposes of this section, where,- (i) a search is initiated under section 132 or books ofaccount, other documents or any assets are requisitionedunder section 132A, on or after the 1st day of April, 2021,in the case of the assessee; or (ii) a survey is conducted under section 133A, other thanunder sub-section (2A) of that section, on or after the 1stday of April, 2021, in the case of the assessee; or (iii) the Assessing Officer is satisfied, with the priorapproval of the Principal Commissioner or Commissioner,that any money, bullion, jewellery or other valuable articleor thing, seized or requisitioned under section 132 orunder section 132A in case of any other person on or afterthe 1st day of April, 2021, belongs to the assessee; or (iv) the Assessing Officer is satisfied, with the priorapproval of Principal Commissioner or Commissioner, thatany books of account or documents, seized orrequisitioned under section 132 or section 132A in case ofany other person on or after the 1st day of April, 2021,pertains or pertain to, or any information containedtherein, relate to, the assessee, (iii) the Assessing Officer is satisfied, with the priorapproval of the Principal Commissioner or Commissioner,that any money, bullion, jewellery or other valuable articleor thing, seized or requisitioned under section 132 orunder section 132A in case of any other person on or afterthe 1st day of April, 2021, belongs to the assessee; or (iv) the Assessing Officer is satisfied, with the priorapproval of Principal Commissioner or Commissioner, thatany books of account or documents, seized orrequisitioned under section 132 or section 132A in case ofany other person on or after the 1st day of April, 2021,pertains or pertain to, or any information containedtherein, relate to, the assessee, the Assessing Officer shall be deemed to have informationwhich suggests that the income chargeable to tax hasescaped assessment in the case of the assessee the search isinitiated or books of account, other documents or any assetsare requisitioned or survey is conducted in the case of theassessee or money, bullion, jewellery or other valuable articleor thing or books of account or documents are seized orrequisitioned in case of any other person. Explanation 3. - For the purposes of this section, specifiedauthority means the specified authority referred to in section151.] 148A. Conducting inquiry, providing opportunity beforeissue of notice under section 148.- The Assessing Officershall, before issuing any notice under section 148,- (a) conduct any enquiry, if require, with the prior approval ofspecified authority, with respect to the information whichsuggests that the income chargeable to tax has escapedassessment; (b) provide an opportunity of being heard to the assessee, byservice upon him a notice to show cause within such time, asmay be specified in the notice, being not less than sevendays and but not exceeding thirty days from the date onwhich such notice is issued, or such time, as may beextended by him on the basis of an application in this behalf,as to why a notice under section 148 should not be issued onthe basis of information which suggests that incomechargeable to tax has escaped assessment in his case for therelevant assessment year and results of enquiry conducted, ifany, as per clause (a); (c) consider the reply of assessee furnished, if any, inresponse to the show-cause notice referred to in clause (b); (d) decide, on the basis of material available on recordincluding reply of the assessee, whether or not it is a fit caseto issue a notice under section 148, by passing an order, withthe prior approval of specified authority, within one monthfrom the end of the month in which the reply referred to inclause (c) is received by him, or where no such reply isfurnished, within one month from the end of the month inwhich time or extended time allowed to furnish a reply as perclause (b) expires: Provided that the provisions of this section shall not apply ina case where, - (a) a search is initiated under section 132 or books ofaccount, other documents or any assets are requisitionedunder section 132A in the case of the assessee on or afterthe 1[st] day of April, 2021; or (b) the Assessing Officer is satisfied, with the prior approvalof the Principal Commissioner or Commissioner that anymoney, bullion, jewellery or other valuable article or thing,seized in a search under section 132 or requisitioned undersection 132A, in the case of any other person on or after the1[st] day of April, 2021, belongs to the assessee; or (c) the Assessing Officer is satisfied, with the prior approvalof the Principal Commissioner or Commissioner that anybooks of account or documents, seized in a search undersection 132 or requisitioned under section 132A, in case ofany other person on or after the 1[st] day of April, 2021,pertains or pertain to, or any information contained therein,[relate to, the assessee; or (b) the Assessing Officer is satisfied, with the prior approvalof the Principal Commissioner or Commissioner that anymoney, bullion, jewellery or other valuable article or thing,seized in a search under section 132 or requisitioned undersection 132A, in the case of any other person on or after the1[st] day of April, 2021, belongs to the assessee; or (c) the Assessing Officer is satisfied, with the prior approvalof the Principal Commissioner or Commissioner that anybooks of account or documents, seized in a search undersection 132 or requisitioned under section 132A, in case ofany other person on or after the 1[st] day of April, 2021,pertains or pertain to, or any information contained therein,[relate to, the assessee; or (d) the Assessing Officer has received any information underthe scheme notified under section 135A pertaining to incomechargeable to tax escaping assessment for any assessmentyear in the case of the assessee.] Explanation. - For the purpose of this section, specifiedauthority means the specified authority referred to in section151.” 9.Reading of Section 148A reveals that the assessing authorityshall, before issuing any notice under section 148 conduct anyenquiry, if required, with the prior approval of specified authority,with respect to the information which suggests that the incomechargeable to tax has escaped assessment. On receipt of suchinformation the assessing officer is required to provide anopportunity of being heard to the assessee, in the manner specified,as to why a notice under Section 148 of the Act should not be issuedon the basis of information which suggests that income chargeableto tax has escaped assessment in his case for the relevantassessment year and results of enquiry conducted as per clause (a),if any. The assessing authority is then required to consider the replyof the assessee, if any, in response to the show cause notice referredto in Clause (b). It is thereafter that the assessing authority has todecide, on the basis of material available on record including reply ofthe assessee, whether or not it is a fit case to issue a notice underSection 148 by passing an order in the manner specified. The provisoexempts the category of cases which are not covered by Section148A. The proviso to section 148A has no applicability in the facts ofthe present case and, therefore, it does not require any examination. 10.The statutory scheme is, therefore, clear that the assessingauthority on receipt of information which suggests that the incomechargeable to tax has escaped assessment may conduct any enquiryin the matter, if required, and then provide an opportunity of beingheard to the assessee by serving upon him a notice under clause (b).On receipt of reply of assessee to the notice referred to in clause (b)the assessing officer on the basis of material available on recordincluding the reply of assessee decide whether or not it is a fit caseto issue a notice under Section 148. 11.The scheme for reassessment of escaped income introducedvide Finance Act, 2021 provides for an opportunity to the assesseebefore issuance of notice under section 148 of the Act of 1961. Aftersuch notice to the assessee and consideration of reply of assessee inresponse to the notice the assessing authority has to decide on thebasis of material available on record by passing an order undersection 148A(d) whether a notice under section 148 is fit to beissued in the case. The consideration at the stage of passing orderunder section 148A(d) is thus limited to ascertainment of informationwith the Assessing Officer that income of assessee has escapedassessment to tax. Final determination on the question whetherincome of assessee has actually escaped assessment is then to bemade after notice under section 148, by passing an order ofassessment or reassessment under section 147, subject to theprovisions of section 148 to 153 of the Act of 1961. 12. The Act of 1961 does not contemplate any detailedadjudication on the merits of information available with theAssessing Officer at the stage of passing order under section148A(d) of the Act of 1961. In our considered view there is a specificpurpose for not introducing any further enquiry or adjudication in thestatute, on the correctness or otherwise of the information, at thisstage. The reason for it is obvious. Under the scheme of the Act adetailed procedure has been provided under Section 148 for issuanceof notice whereafter the assessing authority has to determine, in themanner specified, whether income has escaped assessment and thedefence of assessee, on all permissible grounds, remains open to bepressed at such stage. The ultimate determination made by theassessing authority under Section 147 for reassessment is otherwisesubject to appeal under Section 246-A of the Act. Merits of theinformation referable to Section 148A thus remains subject to thereassessment proceedings initiated vide notice under Section 148 ofthe Act. It is for this reason that issues which require determinationat the stage of reassessment proceedings and in respect of whichdepartmental remedy is otherwise available are not required to be determined at the stage of decision by the assessing authority underSection 149A(d). The scope of decision under Section 148A(d) islimited to the existence or otherwise of information which suggeststhat income chargeable to tax has escaped assessment. 13.In the facts of the present case, it transpires that petitioner inhis return has shown various purchases of arecanut (supari) fromM/s Kuhoje K Achumi and M/s Om Traders. The order under clause(d) of Section 148A records that investigating wing of DGGI and GSThave informed the Income Tax Authorities that M/s Kuhoje K Achumiand M/s Om Traders are found availing and utilizing fraudulent ITCon the basis of fake tax invoices without receipt of goods. It has alsobeen found that the said entity (the seller) does not exist at all atthe declared principal place of business. It is from such doubtfulunits that the petitioner claims to have made purchases amountingto Rs. 1,79,68,750/-. Though the petitioner has alleged that hisBooks of Account truly reflects these transactions and that goodshave been received by way of e-challan, etc., but such defence onmerits of the information is not expected to be authoritativelydetermined by the assessing authority at the stage of decision undersection 148A(d). The forum for determining correctness or otherwiseof the information on the basis of defence setup by the assesseewould be the assessment proceedings under Section 148 of the Act.On the basis of materials which are referred to in the order of theassessing authority under clause (d) of Section 148A, it cannot bedoubted that information did exist with the authorities suggestingthat the income chargeable to tax has escaped assessment. Theformation of opinion by the authority concerned under section148A(d), therefore, cannot be questioned on the basis of detaileddefence setup by the assessee on the merits of the information,including opportunity of cross-examining the seller or by demandingthe documents relating to such information. 14.It is only to the extent of availability or otherwise ofinformation suggesting that income has escaped assessment that the scope of enquiry rests under Section 148A(d). The correctness orotherwise of information is an aspect to be gone into later by theassessing authority at the stage of proceedings under Section 148 ofthe Act for reassessment. Any other interpretation, in our view, isnot countenanced in the scheme of the Act of 1961. 14.It is only to the extent of availability or otherwise ofinformation suggesting that income has escaped assessment that the scope of enquiry rests under Section 148A(d). The correctness orotherwise of information is an aspect to be gone into later by theassessing authority at the stage of proceedings under Section 148 ofthe Act for reassessment. Any other interpretation, in our view, isnot countenanced in the scheme of the Act of 1961. 15.The information with the Assessing Officer which suggests thatthe income chargeable to tax has escaped assessment has beendefined in Explanation 1 to the second proviso to section 148 of theAct which is already extracted above. There is no challenge to theinformation contained in the notice under section 148A(b) of the Acton the ground that the information available with the AssessingOfficer is not referable to Explanation 1 to the second proviso tosection 148 of the Act. The Finance Act, 2021 is otherwise not underchallenge. We are, therefore, of the considered opinion that thechallenge to the information, by the assessee, on the defence setupin reply to show cause notice merits no further consideration at thestage of decision under section 148A(d) of the Act. 16.The term ‘information’ for the purposes of reopening ofassessment has been examined in Larsen & Turbo Ltd. vs. State ofJharkhand, (2017) 13 SCC 780. Paragraph nos.26, 27 and 32 of thereport are apposite for the present purposes and are reproducedhereinafter:- “26. It is also pertinent to understand the meaning of theword “information” in its true sense. According to OxfordDictionary, “information” means facts told, heard ordiscovered about somebody/something. The Law Lexicondescribes the term “information” as the act or process ofinforming, communication or reception of knowledge.The expression “information” means instruction orknowledge derived from an external source concerningfacts or parties or as to law relating to and/or having abearing on the assessment. We agree that a merechange of opinion or having second thought about it bythe competent authority on the same set of facts andmaterials on the record does not constitute “information”for the purposes of the State Act. But the word“information” used in the aforesaid section is of thewidest amplitude and should not be construed narrowly.It comprehends not only variety of factors including information from external sources of any kind but alsothe discovery of new facts or information available in therecord of assessment not previously noticed orinvestigated. Suppose a mistake in the original order ofassessment is not discovered by the assessing officer, onfurther scrutiny, if it came to the notice of anotherassessor or even by a subordinate or a superior officer, itwould be considered as information disclosed to theincumbent officer. If the mistake itself is not extraneousto the record and the informant gathered the informationfrom the record, the immediate source of information tothe officer in such circumstances is in one senseextraneous to the record. It will be information in hispossession within the meaning of Section 19 of the StateAct. In such cases of obvious mistakes apparent on theface of the record of assessment, that record itself canbe a source of information, if that information leads to adiscovery or belief that there has been an escape ofassessment or under-assessment or wrong assessment. 27. There are a catena of judgments of this Court holdingthat assessment proceedings can be reopened if theaudit objection points out the factual information alreadyavailable in the records and that it was overlooked or nottaken into consideration. Similarly, if audit points outsome information or facts available outside the record orany arithmetical mistake, assessment can be reopened. 27. There are a catena of judgments of this Court holdingthat assessment proceedings can be reopened if theaudit objection points out the factual information alreadyavailable in the records and that it was overlooked or nottaken into consideration. Similarly, if audit points outsome information or facts available outside the record orany arithmetical mistake, assessment can be reopened. 32. The expression “information” means instruction orknowledge derived from an external source concerningfacts or parties or as to law relating to and/or afterbearing on the assessment. We are of the clear view thaton the basis of information received and if the assessingofficer is satisfied that reasonable ground exists tobelieve, then in that case the power of the assessingauthority extends to reopening of assessment, if for anyreason, the whole or any part of the turnover of thebusiness of the dealer has escaped assessment or hasbeen under-assessed and the assessment in such a casewould be valid even if the materials, on the basis ofwhich the earlier assessing authority passed the orderand the successor assessing authority proceeded, weresame. The question still is as to whether in the presentcase, the assessing authority was satisfied or not.” 17.In the facts of the present case the assessing authority hasreceived information from DDIT (investigation), Unit III, Nagpurfrom DGGI and GST authorities as well as from CBDT that the sellersof the assessee were availing fraudulent ITC on the basis ofinvestigation made by the concerned agencies. Such informationwould be information referable to clause (i) of Explanation 1 tosecond proviso to section 148 of the Act. We have already observed that there is no challenge to the notice by the assessee on theground that information disclosed vide notice under section 148A(b)is not covered by the information specified in Explanation 1 to thesecond proviso to section 148 of the Act of 1961. 18.Learned counsel for the petitioner has placed reliance upon thejudgment of Supreme Court in Red Chilli International Sales vs.Income Tax Officer, [2023] 146 taxmann.com 224 (SC), wherein theCourt held as under:- “Delay condoned. We with the petitioner that the impugned judgment rejectingthe writ petition on the ground of alternative remedy does nottake into consideration several judgments of this Court, on thejurisdiction of High Court, as writ petitions have beenentertained to be examined whether the jurisdictionpreconditions for issue of notice under Section 148 of theIncome Tax Act, 1961 is satisfied. The provisions of reopeningunder the Income Tax Act, 1961 have undergone anamendment by the Finance Act, 2021, and consequently thematter would require a deeper and in-depth considerationkeeping in view the earlier case law. Accordingly, we set asidethe observations made by the High Court in the impugnedjudgment observing that the writ petition would not bemaintainable in view of the alternative remedy, clarify thatthis issue would be examined in depth by the High Court ifand when it arise for consideration. We do deem it open toexamine this issue in the present case after having examinedthe notice under Section 148A (b) including the annexurethereto, the reply filed by the petitioner and the order underSection 148A (d) of the Income Tax Act, 1961. Recording the aforesaid, the special leave petition is disposedof. We clarify that the dismissal of the special leave petitionwould not be construed as a findings or observations on themerits on case.” Recording the aforesaid, the special leave petition is disposedof. We clarify that the dismissal of the special leave petitionwould not be construed as a findings or observations on themerits on case.” 19.On behalf of the department, Sri Gaurav Mahajan has placedreliance upon a Division Bench judgment of Punjab and HaryanaHigh Court in Anshul Jain vs. Pr. CIT, [2022] 143 taxmann.com 37,wherein the Court observed that no interference by the writ courtwas warranted in the order passed under section 148A(d) of the Actas all the grounds of challenge to such order would be available to anassessee while challenging the order passed in reassessmentproceedings consequent to the notice issued under section 148 of the Act, 1961. 20.The above order of Division Bench of High Court of Punjab andHaryana was challenged before the Supreme Court of India in AnshulJain vs. Pr. CIT, [2022] 143 taxmann.com 38, wherein the Court hasobserved as under:- “What is challenged before the High Court was the re-opening notice under Section 148A(d) of the Income Tax Act,1961. The notices have been issued, after considering theobjections raised by the petitioner. If the petitioner has anygrievance on merits thereafter, the same has to be agitatedbefore the Assessing Officer in the re-assessmentproceedings. Under the circumstances, the High Court has rightlydismissed the writ petition. No interference of this Court is called for. The present Special Leave Petition stands dismissed.” 21.So far as the judgment of Supreme Court of India in Red ChilliInternational Sales (supra) is concerned, the Court directed the HighCourt to consider the reply filed by the petitioner to the notice undersection 148A(b) as well as the order passed under section 148A(d) ofthe Act of 1961 as the High Court had refused to examine the issuein view of the alternative remedy. This direction by the SupremeCourt of India is on the facts of the case as the issues raised by thepetitioner before the High Court were not examined. The SupremeCourt did not endorse the view that a writ petition itself would not bemaintainable against the order passed under section 148A(d) of theAct, 1961 and consequently directed the High Court to examine themerits of order. 22.Maintainability of the writ petition against the order passedunder section 148A(d) is distinct from the scope of adjudicationavailable qua the order passed under section 148A(d) of the Act. Thelimited scope available under Article 226 of the Constitution of Indiato adjudicate an order passed under section 148A(d) of the Act,1961 would be confined to existence of the information only, in view of the scheme of the Act of 1961. A contrary construction cannot beculled out from the judgment of the Supreme Court of India in RedChilli International Sales (supra). 23.In Anshul Jain (supra) the Supreme Court did examine thescope of proceedings under section 148A vis-a-vis reassessmentproceedings under section 148 of the Act to observe that by the verynature of proceedings the examination would remain moreexhaustive at the stage of reassessment proceedings with elaborateremedies available under the statute to the assessee. 24.The order passed by the Assessing Officer under section148A(d) of the Act regarding existence of information suggestingthat income chargeable to tax has escaped assessment wouldotherwise remain subject to reassessment order passed undersection 148 of the Act. Thus, any observations of the assessingauthority while passing order under section 148A(d) with regard tomerits of assessment of income would remain subject to the order tobe ultimately passed in reassessment proceedings under section 148and would not be to the prejudice of rights and contentions of theassessee under section 148 as well as departmental remedies inrespect thereof. 24.The order passed by the Assessing Officer under section148A(d) of the Act regarding existence of information suggestingthat income chargeable to tax has escaped assessment wouldotherwise remain subject to reassessment order passed undersection 148 of the Act. Thus, any observations of the assessingauthority while passing order under section 148A(d) with regard tomerits of assessment of income would remain subject to the order tobe ultimately passed in reassessment proceedings under section 148and would not be to the prejudice of rights and contentions of theassessee under section 148 as well as departmental remedies inrespect thereof. 25.In view of our deliberations and discussions held above, we donot find any merit in the challenge laid to the order of assessingauthority under section 148A(d) of the Act, 1961, dated 29.03.2023,as well as the notice issued under section 148 of the Act, 1961.Subject to the observations contained in this judgment the writpetition accordingly fails and is dismissed. Order Date:- 5.5.2023Ranjeet Sahu/Ashok Kr. (Shiv Shanker Prasad, J.) (Ashwani Kumar Mishra, J.)