2023 (10) TMI 277 - HC - Income Tax

Court upholds reassessment proceedings against charitable society for AY 2016-17 under Income Tax Act. Notice and order valid. Limited review scope.

Smart Vishwas Society Versus Assistant Commissioner Of Income Tax And 2 Others

Smart Vishwas Society Versus Assistant Commissioner Of Income Tax And 2 Others - TMI Issues involved:The challenge to the impugned notice under Section 148A(b) of the Income Tax Act, the order under Section 148A(d), and the consequent initiation of reassessment proceedings for the Assessment Year 2016-17.Details of the Judgment:The petitioner, a charitable society, filed a return of income for Assessment Year 2016-17 declaring total income as Nil. Despite previous assessments and submissions, a notice under Section 148A(b) was issued, leading to the impugned order under Section 148A(d) based on information regarding donations given by the petitioner.The petitioner argued that the reassessment proceedings were initiated merely on the basis of a change of opinion, which is impermissible in law. They contended that the order under Section 148A(d) was passed mechanically without proper application of mind and contravened the prescribed procedure under the Act.In opposition, the Income Tax Department argued that the Assessing Officer found it a fit case to issue the notice under Section 148 based on new information regarding donations, which were not adequately addressed in the original assessment. They maintained that the petitioner can raise objections at the appropriate stage of the proceedings and that no prejudice is being caused.The Court found merit in the submissions of the Income Tax Department, emphasizing that the Act does not require detailed adjudication at the stage of passing the order under Section 148A(d). The purpose is to determine whether income chargeable to tax has escaped assessment, with detailed procedures provided under Section 148 for further assessment and appeal.The Court held that the impugned order and notice did not warrant interference under Article 226 of the Constitution, as challenges could be raised during reassessment proceedings. Citing a previous case, the Court dismissed the writ petition, finding no merit in the challenge to the orders passed under the Income Tax Act.In conclusion, the Court found no basis for interfering with the impugned orders and dismissed the writ petition without costs.This summary provides a detailed overview of the judgment, highlighting the key arguments presented by both parties and the Court's reasoning in reaching its decision.