Court validates notice under Income Tax Act for re-assessment due to inadequate income disclosures. Review application dismissed.

The Court upheld the validity of the notice issued under Section 148 of the Income Tax Act, 1961, finding that the Assessing Officer had sufficient grounds to initiate re-assessment proceedings due to discrepancies in the petitioner's income disclosures. It was determined that the petitioner failed to make a "full and true" disclosure of material facts necessary for assessment, resulting in an escaped income amount. The Court dismissed the petitioner's review application, emphasizing that review jurisdiction is limited to correcting errors on the face of the record, which was not evident in this case. The application lacked merit and was therefore dismissed without costs.

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Issues Involved:
1. Validity of the notice issued under Section 148 of the Income Tax Act, 1961.
2. Whether the petitioner made a "full and true" disclosure of all material facts necessary for assessment.
3. Grounds for seeking a review of the judgment.
4. Scope of review jurisdiction.

Detailed Analysis:

1. Validity of the Notice Issued Under Section 148 of the Income Tax Act, 1961:
The petitioner challenged the validity of the notice issued under Section 148 of the Income Tax Act, 1961. The Court examined the original records of the department and found that the Assessing Officer had recorded reasons for initiating the re-assessment proceedings. The reasons included a discrepancy in the receipts shown by the petitioner, which indicated an income of Rs. 2,62,56,303/- had escaped assessment. The Court held that the Assessing Officer had prima facie material to issue the notice under Section 148, and the notice, along with subsequent proceedings, did not suffer from any illegality warranting interference by the Court.

2. Whether the Petitioner Made a "Full and True" Disclosure of All Material Facts Necessary for Assessment:
The Court found that the petitioner had not disclosed the amount of reimbursement of expenses claimed and the actual amount received towards reimbursement. The petitioner had also not submitted details of expenses incurred for verification during the assessment proceedings. It did not produce any ledger, bills, and vouchers of expenses incurred on behalf of the Principal Companies. Thus, the Court concluded that the petitioner did not make a "full and true" disclosure of all material facts, resulting in an income of Rs. 2,62,56,303/- having escaped assessment.

3. Grounds for Seeking a Review of the Judgment:
The petitioner sought a review of the judgment on several grounds:
- The petitioner claimed it had not received any payments on which TDS had been deducted under Section 194-I and Section 194-J, which was evident from 26 AS.
- The reasons recorded by the Assessing Officer did not mention non-disclosure of the amount of reimbursement of expenses.
- The figures of Rs. 5,23,84,738/- and Rs. 36,13,775/- alleged to have been received through commission and TDS, respectively, were imaginary and did not appear in 26 AS.
- The judgment in Raymond Woolen Mills Ltd. was case-specific and could not be applied to the petitioner's case.
- The judgment in Phool Chand Bajrang Lal supported the petitioner's contention that the Assessing Officer must have tangible material before initiating reassessment proceedings.
- Various case laws relied upon by the petitioner were not considered by the Court.

4. Scope of Review Jurisdiction:
The Court examined the scope of review jurisdiction, emphasizing that review cannot be treated as an appeal and is limited to correcting errors apparent on the face of the record. The Court referred to several Supreme Court judgments explaining the term "error apparent on the face of the record." The Court found that the grounds raised by the petitioner required a re-hearing of the writ petition, which is not permissible in a review. The Court also noted that the petitioner would have the opportunity to place all facts and submissions during the reassessment proceedings.

Conclusion:
The Court concluded that there was no "error apparent on the face of the record" in the judgment and order dated 20-04-2022. The application for review lacked merit and was dismissed. There was no order as to costs.

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