Court dismisses writ petitions, directs appeal under Section 246A. Emphasizes exhausting remedies before writ jurisdiction.

The court dismissed the writ petitions, directing the petitioner to avail the statutory remedy of appeal under Section 246A of the Income Tax Act within two weeks. It emphasized exhausting alternative remedies before resorting to writ jurisdiction, citing precedent. The court found no violation of procedure for reopening assessments, noting the petitioner's participation in reassessment proceedings without objections. The reopening was upheld based on the belief of income escapement due to depreciation claims. The court highlighted the necessity of disclosing material facts for reassessment beyond four years.

---

---

Issues Involved:
1. Violation of procedure for reopening of assessment.
2. Failure to disclose material facts.
3. Lack of tangible material for the reason to believe that income has escaped assessment.
4. Jurisdiction to initiate reopening proceedings.
5. Basis of reassessment on audit objection.
6. Invoking writ jurisdiction under Article 226.
7. Reopening assessment beyond four years without failure to disclose material facts.

Detailed Analysis:

1. Violation of Procedure for Reopening of Assessment:
The petitioner contended that there was a violation of procedure for reopening the assessment as no written reasons for reopening were furnished. The court noted that the petitioner did not file any objections to the reasons for reopening the assessments and participated in the reassessment proceedings. Therefore, the question of disposing of objections by passing a speaking order did not arise, as per the precedent set by the Supreme Court in "GKN Drivershafts (India) Ltd. versus Income Tax Officer and others."

2. Failure to Disclose Material Facts:
The petitioner argued that there was no failure on their part to disclose fully and truly all material facts for the relevant assessment years. The court observed that the reopening of the assessment was based on the belief that the income had escaped assessment due to the depreciation claim on dealer and vendor networks. The court referenced "Fenner (India) Ltd. Versus DCIT" which emphasizes that mere escape of income is insufficient for action after four years unless there is a failure to disclose material facts.

3. Lack of Tangible Material for Reason to Believe:
The petitioner claimed there was no tangible material for the respondent to form a 'reason to believe' that the income had escaped assessment, which amounted to a change of opinion. The court referred to "CIT v Kelvinator of India" which held that a change of opinion cannot justify reopening an assessment unless there is tangible material indicating income escapement.

4. Jurisdiction to Initiate Reopening Proceedings:
The petitioner argued that the respondent lacked jurisdiction to initiate reopening proceedings as the issue of depreciation was already considered during the original assessment. The court noted that the reopening was initiated because the issue of depreciation on dealer and vendor networks was not dealt with during the original assessment.

5. Basis of Reassessment on Audit Objection:
The petitioner contended that the reassessment was based on an objection by the internal audit party, which is impermissible. The court did not specifically address this issue in detail but focused on the procedural aspects and participation of the petitioner in the reassessment proceedings.

6. Invoking Writ Jurisdiction under Article 226:
The petitioner invoked writ jurisdiction under Article 226, arguing that the proceedings were erroneous, arbitrary, and contrary to settled law. The court held that the petitioner had an efficacious remedy of appeal under Section 246A of the Income Tax Act and should have exhausted this remedy before approaching the court. The court cited "CIT v Chhabil Dass Agarwal," emphasizing that writ petitions should not be entertained when an effective alternative remedy is available.

7. Reopening Assessment Beyond Four Years:
The petitioner argued that the reopening of the assessment for the year 2008-09 was initiated beyond four years despite no failure to disclose material facts. The court reiterated that the reopening was based on the belief that the income had escaped assessment and the petitioner had participated in the reassessment proceedings without raising objections.

Conclusion:
The court dismissed the writ petitions, stating that the petitioner should avail the statutory remedy of appeal under Section 246A of the Income Tax Act. The appellate authority was directed to entertain the appeal without considering the limitation period if approached within two weeks from the date of receipt of the court's order. The court emphasized the importance of exhausting alternative remedies before invoking writ jurisdiction.

---