Kalyanasundaram Swaminathan Vs DCIT (Madras High Court)
Summary : The Madras High Court, by a common order, disposed of W.P.No.2485 of 2019 and W.P.No.2495 of 2019 concerning reassessment proceedings for Assessment Year 2011-2012. The Petitioner challenged the assessment order passed under Section 143(3) read with Section 147 of the Income Tax Act, 1961 and the notice issued under Section 148. The principal challenge was that the assessment was completed without issuing a notice under Section 143(2) after the return was filed in response to the Section 148 notice.
The Petitioner had originally filed a return under Section 139(1), declaring taxable income of Rs.8,30,977/-. The return was processed under Section 143(1). Following proceedings under Section 272A, the Petitioner filed a revised return under Section 139(4), declaring gross total taxable income of Rs.17,29,621/- and paying Rs.4,34,512/- towards income tax. The revised return included Rs.42,65,000/- stated as “non-compete fee” received from M/s.Edserve Soft Systems Limited. A Section 148 notice was subsequently issued. The Petitioner requested that the earlier revised return be treated as the return in response to the notice and later submitted a return reiterating the contents of the revised return.
The reasons supplied for reopening stated that information concerning M/s.Smartlearn Edutech (P) Ltd. indicated receipt of Rs.42,65,000/- as non-compete fee which had not been reported in the original return. During the reassessment proceedings, the Petitioner was also asked to furnish details concerning the non-compete fee and a business loss of Rs.27,97,576/- claimed as written off. The Petitioner stated that documents had been lost during the 2015 flood and filed replies to notices under Section 142(1).
