Wtax/739/2023 Of A S And Company v. The Income Tax Officer, Ward -2 (1) Moradabad

Court No. - 42 Case :- WRIT TAX No. - 739 of 2023 Petitioner :- A S And Company Respondent :- The Income Tax Officer, Ward -2 (1) Moradabad Counsel for Petitioner :- Niraj Kumar Singh,Praveen Kumar Srivastava Counsel for Respondent :- Gaurav Mahajan Hon'ble Saumitra Dayal Singh,J.'Honble Rajendra Kumar-IV,J. 1. Heard Sri Niraj Kumar Singh, learned counsel for thepetitioner, Sri Manu Ghildyal, learned counsel for therevenue. 2. Challenge has been raised to the reassessmentproceedings initiated against the petitioner for theAssessment Year 2016-17, under the Income Tax Act, 1961(hereinafter referred to as the 'Act'), vide reassessmentorder dated 26.04.2023. 3. Principally, the submission of the learned counsel for thepetitioner is, no enquiry as was necessary, has beenconducted before the Assessing Officer formed his opinion,income had escaped assessment and before he passed theorder under Section 148A (d) of the Act. 4. Merely, because an ex parte statement may have beenrecorded against the petitioner that too in searchproceedings against a third party, it may not be enough toreach any conclusion that income had escaped assessmentat the hands of the petitioner. 5. On the other hand, learned counsel for the revenue wouldcontend, at present relevant material / information existsagainst the assessee indicating escapement of income ofRs. 1,96,00,000/-. Thus, the petitioner is alleged to haveobtained accommodation entry of that value from M/sDyaneshwari Multi State Urban Co-operative Credit SocietyLimited. That information and material is based on thestatement of General Manager of the said entity recorded inthe search proceedings conducted against that society. 6. Having heard learned counsel for the parties and perusedthe record, though it is true, no reassessment proceedingsmay arise unless adequate material exists indicatingescapement of income at the hands of an assessee, yet, atthis stage, only the relevancy of the material and theprocedural requirement of confronting the assessee with thesame before reaching a firm conclusion as to escapement, isto be fulfilled. 7. The absolute correctness of the information or thesufficiency thereof is not to be tested at present. Thus, theopportunity to cross-examine the persons who may havemade an adverse statement against the petitioner, mayremain to be seen in the reassessment proceedings thathave just arisen. No reassessment proceedings may beconcluded solely on the basis of ex parte statement of a thirdperson without the assessee-petitioner being allowedopportunity to cross-examine the correctness of thatstatement. The initiation of the reassessment proceedingsmay not be faulted for absence of cross-examination, at theinitial stage. 8. In view of the above, writ petition lacks merit and isaccordingly dismissed. 9. The reassessment proceedings may be completed onown merits without being prejudiced by any observationmade in this order. Order Date :- 30.5.2023SA (Rajendra Kumar-IV, J.) (S. D. Singh, J.)