Case Law Details
The petitioner is a retired officer of the Indian Revenue Service and served in various capacities including, inter alia, the position of Chief Commissioner of Income Tax, Director General of Vigilance, Chief Vigilance Officer of the Central Board of Direct Taxes and Income Tax Ombudsman.
In respect of the assessment year 2004-05, he filed a return of income declaring a total income of Rs.4,10,917/- consisting of salary income, property income and income from other sources. It was processed under Section 143(1) of the Act. On 31.03.2011 a notice was received by him under Section 148 of the Act seeking to reopen the assessment on the ground that income chargeable to tax had escaped assessment. The petitioner appears to have filed a return of income in response thereto and sought the reasons recorded to reopen the assessment. The reasons were furnished on 27.06.2011 to which the petitioner filed objections questioning the jurisdiction of the respondent No.1 to issue the notice. It was contended that the reasons recorded were not sufficient in law to entertain the belief that there was escapement of income, that the allegations leveled in the tax evasion petition on the basis of which the assessment was reopened were factually incorrect and further that the re¬assessment proceedings were barred by limitation. The first respondent did not agree with the objections and dismissed them vide order dated 25.07.2011. Against the said order the petitioner filed W.P.(C) No.6011/2011 on 17.08.2011, impugning both the notices issued under Section 148 and the order dismissing the objections of the petitioner. By order dated 23.08.2011 this Court allowed the writ petition and directed the first respondent to pass a fresh order dealing with the petitioner‟s objections, particularly the objection that the tax evasion petition on the basis of which the assessment was reopened contained factually incorrect allegations.
The contentions of the petitioner deserve acceptance. Once the first respondent found, after due inquiries, that there was no basis to connect the petitioner with the May Fair Garden property, he ought to have dropped the reassessment proceedings. Nothing survived thereafter. He was, therefore, acting outside jurisdiction when he issued a letter on 02.11.2011 calling upon the petitioner to avail of the opportunity, if so advised, given to him to cross-examine the complainant – i.e., the person who was the author of the tax evasion petition. The only order which could have been passed by the first respondent, after finding that there was no basis for the tax evasion petition connecting the petitioner with the May Fair Garden property, was to drop the proceedings initiated under Section 148. Surprisingly one month after the first respondent wrote to the petitioner conceding that there was no basis for the tax evasion petition, he invited the petitioner to cross-examine the complainant, if so advised. Such a procedure is unknown to the Act. Instead of terminating the proceedings initiated under Section 148 of the Act by dropping them the first respondent chose inexplicably to keep those proceedings alive. This is illegal and impermissible in law. This amounts to nothing but harassment of the petitioner. There appears to be some vested interest in keeping the proceedings against the petitioner pursuant to the notice dated 31.03.2011 alive. The tax evasion petition and the present proceedings seem to be the result of a personal vendetta between two officers of the Indian Revenue Service (IRS) (the complainant being one of them). This unfortunately has resulted in multiple proceedings before this Court.
The respondents have to act in accordance with law and not under any pressure. The AO, being a responsible officer should not be party or pressurised by someone to personal vendetta. Being statutory officers they have to act independently and in accordance with law.
HIGH COURT OF DELHI AT NEW DELHI
Please become a Premium member. If you are already a Premium member, login here to access the full content.
When a retired Revenue Officer of the rank of CIT, DG Vigilance, CBDT etc can be constantly harassed he rightly approached the High Court, imagine the fate of a common tax payer! There are many more cases of the ITOs or the FIU shooting out computerised unsigned notices.
I, a retired CA, have received a issued notice for 3 years long after I have have been assessed and even refund orders issued for the long bygone assessment years. Subsequent refunds of TDS are held up. CPC doesn’t respond and the Jurisdictional ITO passes the buck.
Nagesh Kini, CA Mumbai