Sanjay Ratra Vs ACIT (Bombay High Court)
In Sanjay Ratra vs. ACIT, the Bombay High Court dismissed a petition challenging reassessment proceedings initiated under Section 148 of the Income Tax Act, 1961, for the assessment year 2016–17. The petitioner contended that the reassessment notice was based on erroneous information and argued it lacked jurisdiction. The petitioner had disclosed capital gains in the original and revised returns, and the original scrutiny assessment concluded in 2018 focused on Chapter VI-A deductions. However, the reassessment notice issued in 2023 alleged undisclosed cash receipts of ₹1.30 crore and unverified credit card transactions of ₹19.09 lakh.
The court noted that the reassessment was based on new information received after the original assessment, in accordance with the Central Board of Direct Taxes (CBDT)’s Risk Management Strategy. It rejected the petitioner’s claims that these issues were examined during the original proceedings, emphasizing that the initial scrutiny was limited in scope. The petitioner was allowed to raise jurisdictional and factual objections during appellate or reassessment proceedings. The court found no procedural errors or lack of application of mind in the approval process under Section 151 and concluded that the reopening was valid. While dismissing the petition, the court clarified that its observations were prima facie and did not preclude the petitioner from pursuing remedies under the appellate framework.
