Introduction: Ashok Kumar Sinha filed a writ petition against the notice issued under Section 148A(b) of the Income Tax Act, 1961, the assessment order passed under Section 148A(d), and the consequential notice issued under Section 148. The petitioner argued that the assessment order and notices were passed without considering the detailed response filed by him, which explained the charge of escaped assessment related to outward foreign remittances. The Delhi High Court heard the case and disposed of the petition, setting aside the order and notices and directing a re-examination of the material by the Assessing Officer (AO).
Analysis: The petitioner claimed that the foreign remittances were made from the sale of an immovable property by his late father and other amounts credited to his account. He stated that after his father’s death, the remaining amount in the joint account with the State Bank of India (SBI) was remitted to his bank account with Barclays Bank in England. The petitioner provided supporting documents, including the statement of the SBI account and an index of submitted documents.
The senior standing counsel for the revenue agreed that the best course of action would be to set aside the order and direct a re-examination of the material presented by the petitioner, including the documents filed with the court.
The court agreed with the counsel and set aside the assessment order and notices. The AO was instructed to consider the assertions made in the writ petition, the accompanying documents, and the documents already submitted by the petitioner. The AO would determine whether reassessment proceedings should proceed and, if so, provide the petitioner with a notice and an opportunity for a personal hearing. The AO was required to pass a speaking order and provide a copy to the petitioner, who would have the right to challenge the order in accordance with the law.
Conclusion: The Delhi High Court disposed of the writ petition, setting aside the assessment order and notices, and ordering a re-examination of the material by the Assessing Officer. The court instructed the AO to consider the petitioner’s assertions and documents, issue a fresh notice if necessary, provide a personal hearing, and pass a speaking order. The petitioner was granted the liberty to challenge the order, if needed, following the legal process.
Note: The above analysis is based on the information provided in the judgment.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
W.P.(C) 7396/2023 and CM APPL. 28771/2023[Application filed on behalf of the petitioner seeking interim relief]
1. Issue notice.
1.1 Mr Aseem Chawla, learned senior standing counsel, who appears on behalf of the respondents/revenue accepts notice.
2. Mr Chawla says, that in view of the order that we propose to pass, he does not wish to file a counter-affidavit in the matter, and he will argue the matter, based on the record presently available with the Court.
3. Therefore, with the consent of the counsel for parties, the writ petition is taken up for hearing and final disposal, at this stage itself.
4. This writ petition is directed against the notice dated 23.03.2023 issued under Section 148A(b) of the Income Tax, 1961, [in short, “the Act”].
4.1 Besides this, challenge is also laid to the assessment order dated 24.04.2023 passed under Section 148A(d) of the Act.
5. In addition thereto, challenge is also laid to the consequential notice of even date i.e., 24.04.2023 issued under Section 148 of the Act.
6. Counsel for the petitioner submits, that the impugned order and consequential notice have been passed, without taking into account the detailed response filed by the petitioner, to explain the charge levelled against him, which is, that outward foreign remittance made by him had, purportedly, escaped assessment.
7. It is, thus, submitted that although the Assessing Officer (AO) has extracted several parts of the petitioner’s response dated 15.04.2023, there has been no application of mind, with regard to the information contained therein.
8. Broadly, it is the petitioner’s case, that the foreign remittance came be to be made on account of sale of immovable property by his late father i.e., one Dr. Achyutanand Sinha, and other amounts which stood credited to his account.
9. It is also the petitioner’s case, that his father i.e., Dr. Achyutanand Sinha had distributed a large part of the credit balance obtaining in his account between the petitioner and his sibling. Upon the death of the father, his account, maintained with SBI, which was jointly held by the petitioner, was converted into a Non-Resident Ordinary (NRO) account, and thereafter the remaining amount was remitted to the petitioner’s bank account maintained with the Barclays Bank, in England.
10. The remittance from the SBI account to Barclays Bank was the outward foreign remittance which came under scrutiny by the AO.
11. Thus, the details of the sources of foreign remittance and the ultimate transmission of amount from SBI maintained jointly by the petitioner, along with his father, are set out.
12. Counsel for the petitioner emphasizes, that upon the death of his father, he was the sole person operating the account, which, as indicated above, resulted in the remittance of balance amount from the SBI account to Barclays Bank Account.
13. We may note, that the petitioner has appended the statement of the subject bank account maintained with SBI at the relevant point of time, which is marked as Annexure P-9, and is appended on page 99 of the case file.
14. In support of his plea that every document was submitted to the AO, our attention is drawn to Annexure-10, which is appended on page 100 of the case file, indicating the index accompanying the documents that were filed with the AO.
15. Mr Aseem Chawla, learned senior standing counsel, who appears on behalf of respondents/revenue submits, that the best way forward would be to set aside the order and direct a reexamination of the material placed on record by the petitioner, including the material that was placed before this Court.
16. We tend to agree with Mr Chawla.
17. Accordingly, the impugned order and notices are set aside.
18. The AO will take into account the assertion(s) made in the writ petition and the accompanying documents.
19. Besides this, documents which are already filed by the petitioner with the AO will also be considered. Thereafter, the AO will examine, whether the reassessment proceedings need to be taken forward.
20. In case the AO is of the view that reassessment proceedings are to be taken forward, he shall issue a notice to the petitioner, and in such eventuality, accord him personal hearing in the matter.
21. The AO will permit the petitioner to appear in-person and/or through his authorized representative.
22. Needless to add, the AO will pass a speaking order; a copy of which will be furnished to the petitioner.
23. The petitioner will have the liberty to assail the order passed by the AO, albeit, in accordance with the law.
24. The writ petition is disposed of in the aforesaid terms.
25. Consequently, pending application shall stand closed.
26. Parties will act based on the digitally signed copy of the order.