LI Network
Published on: November 30, 2023 at 12:40 IST
The Calcutta High Court has set aside a reassessment order, asserting that the personal opinion of the department does not constitute tangible material justifying the reopening of an assessment.
Chief Justice T. S. Sivagnanam and Justice Hiranmay Bhattacharyya, presiding over the bench, emphasized that unless glaring omissions or non-compliance with prerequisites for reassessment are evident, the writ court would not typically intervene in orders passed under Section 148A(d) of the Income Tax Act.
The appellant, challenging the order for the assessment year 2017-18 under Section 148A(d) of the Income Tax Act, had their writ petition dismissed by a Single Bench.
The court ruled that the assessee could raise all concerns during the reassessment proceedings.
The assessing officer had initiated the reopening of the assessment for the year 2016–17, pertaining to the financial year 2015–16. The writ petitioner successfully contested these proceedings, and the order became final with no intra-court appeal filed by the department.
Subsequently, for the assessment year 2017–18, relevant to the financial year 2016–17, the assessee received a notice under Section 148A(b), citing credible information via the insight portal on cash deposits, interest receipts, and debenture purchases.
The department’s lack of concrete evidence indicating income evasion was highlighted by the assessee, who explained that cash deposits were sourced from their bank account withdrawals.
The court held that for a valid reassessment, the assessing officer must present tangible material demonstrating income evasion liable for taxation.
Case Title: Dinesh Kumar Goyal Huf Vs Income Tax Officer Ward-43(1) Kolkata And Ors. Case No.: MAT/1685/2023 IA NO: CAN/1/2023