Case Law Details
Rachna Singhi Vs ITO (Calcutta High Court)
Introduction: The Calcutta High Court, in the recent case of Rachna Singhi Vs Income Tax Officer (ITO), highlighted the implications of Section 148A(d) of the Income Tax Act, 1961. The Court ruled that an order under this section is not a final assessment order and does not result in any income tax demand.
Analysis: Rachna Singhi, the petitioner, challenged the order under Section 148A(d) of the Income Tax Act, 1961, relating to the assessment year 2019-20. She expressed dissatisfaction with the reasoning provided by the respondent, the ITO, in his order. However, the Court observed that the order was neither in violation of natural justice principles nor procedural irregularities, nor was it contrary to any specific Act provisions.
The High Court held that the sufficiency or reasonableness of the reasoning in an order under Section 148A(d) cannot be challenged in the writ court when the petitioner has already been given the opportunity to file an objection. Even though the Assessing Officer may have arrived at a different finding and conclusion, the petitioner still has ample scope in the proceedings following the Section 148 notice to make her case.
Furthermore, the Court opined that an order under Section 148A(d) is neither a final assessment order nor does it create any tax demand.
Conclusion: This ruling by the Calcutta High Court in Rachna Singhi Vs ITO clarifies that Section 148A(d) order is not final and does not yield any tax demand.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
By this writ petition, petitioner has challenged the impugned order under Section 14A(d) of the Income Tax Act, 1961 dated 30th March, 2023 relating to assessment year 2019-20. I have perused the order and considered the submission of the parties. Petitioner is not satisfied with the reasoning given by the respondent/Income Tax Officer in his impugned order dated 30th March, 2023. The aforesaid impugned order has neither been passed in violation of principles of natural justice nor there is any procedural irregularity, nor the impugned order is contrary to any specific provisions of any Act. Sufficiency of the reason or reasonableness of the reason in an impugned order under Section 148A(d) of the Act cannot be gone into by the writ court when petitioner was already given an opportunity to file objection by the petitioner and the same was considered by the Assessing Officer though he may have come to a different finding and conclusion.
Furthermore, petitioner still has ample scope in the proceedings subsequent to the notice under Section 148 of the Act after passing the order under Section 148A(d) of the Act to make out a case if she has in her favour. I am also of the view that the order under Section 148A(d) of the Act is neither final assessment order nor any demand arises out of the same.
In view of the discussion made above, I am not inclined to entertain this writ petition being WPA 10215 of 2023, and accordingly, the same is dismissed.
However, dismissal of this writ petition will not be a bar on the part of the petitioner to raise all the points in the impugned proceedings, which has been raised in this writ petition and the Assessing Officer to consider the same in accordance with law.
