Mukundbhai Manubhai Patel Vs ACIT (Gujarat High Court)
Gujarat High Court held that the respondent officer could not have assumed jurisdiction for reopening the assessment since there was nothing which indicate that petitioner has participated knowingly in the sham transaction. Accordingly, order is quashed and set aside.
Facts- The petitioner filed Return of Income for Assessment Year 2018-19 on 18.09.2018 offering total income at Rs.1,67,40,840/-. The impugned show cause notice under Section 148A(b) of the Act was issued on 23.03.2022 by the Respondent along with the details of information on the basis of which it was believed that the income chargeable to tax has escaped the assessment for the year under consideration.
By this petition under Articles 226/227 of the Constitution of India, the petitioner has challenged the notice dated 08.04.2022 issued under Section 148 of the Income Tax Act, 1961 as well as the order dated 08.04.2022 passed under Section 148A(d) of the Act.
Conclusion- Held that considering the aforesaid decisions of the Hon’ble Apex Court in the case of Walfort Share & Stock Brokers (P). Ltd. and the decision of the Bombay High Court in case of Karan Maheshwari, we are of the opinion that the respondent officer could not have assumed jurisdiction for reopening the assessment and, therefore, adopting the same reasons as per the aforesaid decisions, the impugned order as well as well as the assessment orders are not tenable in the eyes of law. Accordingly, the impugned notice dated 08.4.2022 and the assessment order dated 08.04.2022 are hereby quashed and set aside. Rule is made absolute to the aforesaid extent with no order as to cost.
