Dismissal of Writ Challenging Income Tax Reassessment Notice under Section 148

The court dismissed the writ application challenging the notice for reopening assessment under Section 148 of the Income Tax Act, 1961 for A.Y 2012-13. It held that the notice was not without jurisdiction as the conditions under Section 147 were met. The Assessing Officer independently applied his mind, forming a belief that income had escaped assessment based on verified information. The reasons for reopening were found valid, discrepancies in reassessment figures were rejected, and third-party statements were considered relevant. The sanction for issuing the notice under Section 151 was deemed valid, leading to the dismissal of the applicant's contentions.

---

---

Issues Involved:
1. Legality and jurisdiction of the notice for reopening assessment under Section 148 of the Income Tax Act, 1961.
2. Independent application of mind by the Assessing Officer.
3. Validity of reasons for reopening based on suspicion and verification.
4. Discrepancies in the figures mentioned for reassessment.
5. Evidentiary value of third-party statements.
6. Validity of sanction for issuance of notice under Section 151 of the Act.

Issue-wise Detailed Analysis:

1. Legality and Jurisdiction of the Notice:
The writ applicant challenged the notice of reopening the assessment dated 19.03.2019 under Section 148 of the Income Tax Act, 1961, for A.Y 2012-13, claiming it was illegal and without jurisdiction as the conditions under Section 147 were not met. The court noted that the return of income for the year was filed on 29.09.2012 and processed without scrutiny under Section 143(1). The reopening was based on information received from the ITO, indicating high-value financial transactions without actual business activities, suggesting the income had escaped assessment.

2. Independent Application of Mind by the Assessing Officer:
The writ applicant contended that the Assessing Officer did not independently apply his mind and relied on borrowed satisfaction from the information received. The court examined the reasons recorded and found that the Assessing Officer had verified the details and bank statements of the entities involved, concluding that the transactions were bogus and the income had escaped assessment. The court held that the Assessing Officer had formed an independent belief based on the material available.

3. Validity of Reasons for Reopening Based on Suspicion and Verification:
The applicant argued that the reasons for reopening were recorded for investigation and verification purposes, which is impermissible. The court referred to various judgments, emphasizing that at the stage of issuing a notice under Section 148, what is required is a "reason to believe" that income has escaped assessment, not conclusive proof. The court concluded that the reasons recorded by the Assessing Officer were sufficient to form a belief of escapement of income.

4. Discrepancies in the Figures Mentioned for Reassessment:
The applicant pointed out discrepancies in the figures mentioned in the reasons for reassessment, particularly regarding transactions with J.K Enterprise. The court noted that the Assessing Officer had verified the bank statements and found that the entities involved had no actual business activities, providing accommodation entries through bogus billing. The court found no merit in the applicant's contention regarding discrepancies.

5. Evidentiary Value of Third-Party Statements:
The applicant argued that the statements of Smt. Harshaben Rasikbhai Gosai and Mr. Kundan Mudaliar had no evidentiary value as the assessee had no business relations with them. The court observed that the Assessing Officer had verified the information and found that the transactions were bogus, and the entities involved provided accommodation entries. The court held that the Assessing Officer's belief was based on relevant material and not solely on third-party statements.

6. Validity of Sanction for Issuance of Notice under Section 151:
The applicant contended that the sanction for issuing the notice was given without satisfaction and in a mechanical manner. The court examined the record and found no evidence indicating that the sanction was accorded mechanically. The court held that the sanction was valid and the contention raised by the applicant was without basis.

Conclusion:
The court dismissed the writ application, holding that the notice issued under Section 148 was not without jurisdiction and was based on sufficient material. The Assessing Officer had formed an independent belief that income had escaped assessment, and the sanction for issuing the notice was valid. The objections raised by the applicant were extensively dealt with and properly disposed of by the authority.

---