Virendra Naginbhai Patel (HUF) Vs ITO (Gujarat High Court)
The Gujarat High Court dismissed the writ petition challenging the notice dated 29.03.2019 issued under Section 148 of the Income-tax Act, 1961, and the order dated 09.11.2019 rejecting the petitioner’s objections to the reassessment proceedings. During the proceedings, the Court also took on record the form recording the reasons for initiation of proceedings under Section 147, signed by the Principal Commissioner of Income Tax, Vadodara-I.
The petitioner, a Hindu Undivided Family (HUF), had filed its return of income as well as its Wealth Tax return for Assessment Year 2012-13. Subsequently, the Assessing Officer issued a notice under Section 148, stating that income chargeable to tax had escaped assessment. The petitioner received the recorded reasons, filed objections, requested disposal of those objections, and thereafter challenged the rejection order by filing the writ petition.
The petitioner contended that all material facts had been fully and truly disclosed in both the income-tax and Wealth Tax returns. It submitted that Form ITR-3 did not contain any column requiring disclosure of investments such as purchase of land and that the transaction had already been disclosed in the Wealth Tax return. According to the petitioner, the Income Tax Department was therefore aware of the purchase of the land. The petitioner further argued that the reassessment proceedings were initiated merely to conduct a verification exercise and that the sanction under Section 151 was not properly reasoned. Reliance was placed on the decisions in India Gelatine and Chemicals Ltd. vs. Assistant Commissioner of Income-Tax and Principal Commissioner of Income-tax-5 vs. Manzil Dineshkumar Shah.
