COMUNIDADO OF CHICALIM VS INCOME-TAX OFFICER
2001 P T D 2413
[247 I T R 271]
[Supreme Court of India]
Present: S. P. Bharucha, R. C. Lahoti and N. Santosh Hegde, JJ
COMUNIDADO OF CHICALIM
Versus
INCOME‑TAX OFFICER and others
C. A. No. 7314 of 1996, decided on 28/07/2000.
(Appeal by special leave from the judgment and order, dated November 19, 1991, of the Bombay High Court in Writ Petition No.356 of 1991).
Income‑tax‑‑‑
‑‑‑‑Reassessment‑‑‑Writ‑‑‑Notice of reassessment‑‑‑Writ petition against notice on grounds that no reason had been recorded or disclosed under S.148 and that assessee had already received a notice earlier and had' submitted a return in response to it and that second notice was barred by time‑‑‑Dismissal of writ petition by High Court was not valid‑‑‑Indian Income Tax Act, 1961, Ss. 147 & 148‑‑‑Constitution of India, Art. 226.
When an assessee challenges a notice to reopen an. assessment under section 147 of the Income Tax Act, 1961, on the ground that no reasons under section 148 had been recorded or disclosed, the Court must call for and examine the reasons, and, in fact, ordinarily, the reasons are set out by the respondents to the writ petition in their counter.
Where, on a writ petition challenging a notice under section 148 on the ground that the Income‑tax Officer failed to disclose the reasons, and that since the assessee_ had filed a return in response to an earlier notice for the same period, a second notice did not lie, the High Court dismissed the petition summarily. On appeal to the Supreme Court:
Held, that the High Court ought to have called for and examined the reasons. The High Court also did not appreciate that if the appellant had already been served with a notice under section 148 and had complied therewith by filing a return, it was entitled to contend that no second notice lay, and also to submit that, in any event, the second notice was barred by time. The dismissal of the writ petition by the High Court was not valid.
K.J. John, Advocate for Appellant.
Anil Kumar Gupta and Ms. Sushma Suri, Advocates for Respondents.
ORDER
Under appeal by special leave is an order of a Division Bench of the High Court at Bombay, sitting at Panaji. By that order, the writ petition filed by the appellant was summarily dismissed.
By the writ petition, the appellant challenged the validity of a notice issued to it by the first respondent under section 148 of the Income Tax Act, 1961. The notice alleged that the first respondent had reason to believe that the appellant's income chargeable to tax for the assessment year 1986‑87 had escaped assessment and that, therefore, the first respondent proposed to assess the appellant's income for that assessment year. It was averred in the writ petition that the first respondent had failed to disclose the reasons that he was obliged to record under section 148(2) for reopening the assessment. Further, the writ petition averred that the respondents had already issued a notice to the appellant under section 141 of the Income Tax Act, 1961, for the same assessment year and that the appellant had, in compliance therewith, filed a return. It was asserted that, therefore, the second notice under section 148 did not lie.
The Division Bench took the view that section 148 merely required that the reasons should be recorded, not that they should be communicated. Since, therefore, there was, in its view, no failure to perform a statutory duty, it could not call for and examine the reasons. As to ground in relation to the previous notice, the Division Bench noted that it had not been asserted in the writ petition that the income‑tax authority had made an assessment pursuant to the previous notice. It observed that the appellant had submitted to the jurisdiction of the authority under section 148 and, therefore, "acquiesced off the grievance".
We are afraid that the High Court was in error on both counts. It is trite law that when an assessee challenges a notice to reopen under section 147 on the ground that no reasons under section 148 had been recorded or disclosed, the Court must call for and examine the reasons, and, in fact, ordinarily, the reasons are set out by the respondents to the writ petition in their counter. The High Court also did not appreciate that if the appellant had already been served with a notice under section 148 and had complied therewith by filing a return, it was entitled to contend that no second notice lay and also to submit that, in any event, t1te second notice was barred by time.
It is, therefore, necessary to set aside the order of summary dismissal of the writ petition and to restore the writ petition (Writ Petition No.356 of 1991) to the file of the High Court to be heard and disposed of on the merits. Our observations are confined to the order of the summary dismissal that is impugned and should not in anyway influence the decision of the Court on the merits. Both the parties shall be entitled to take all available contentions at such hearing. The writ petition, having regard to the lapse of time, shall be decided expeditiously.
Order on the appeal accordingly. No order as to costs.
M.B.A./985/FC?????????????????????????????????????????????????????????????????????????????????? Order accordingly.