Dismissal of Petition on Income Tax Notice: Court Validates Notice for AY 2017-18; Grievances to Assessing Officer.

The HC dismissed the writ petition challenging the order under Section 148A(d) and the notice under Section 148 of the Income Tax Act for Assessment Year 2017-18. The court held that the notice was valid as it suggested income had escaped assessment. It emphasized that grievances on merits should be addressed during reassessment proceedings before the Assessing Officer. No costs were awarded.

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Issues involved:
The challenge to the order dated 31.7.2023 under Section 148-A (d) of the Income Tax Act for the Assessment Year 2017-18 and the consequential Notice dated 31.7.2023 issued under Section 148 of the Income Tax Act for the same assessment year.

Details of the Judgment:

Issue 1: Registration under Section 12 AA of the Act
The petitioner, a Society providing medical relief, had its registration under Section 12 AA canceled but later restored. Despite this, a notice was issued under Section 148 A (b) of the Act, leading to a recommendation for reopening the case. The petitioner argued that the refusal to grant benefits under Section 11 and 12 was unwarranted due to the restoration of registration. The respondent contended that the assessing authority found grounds to issue the notice under Section 148. The court found that the information available suggested that income had escaped assessment, and the notice under Section 148 was valid.

Issue 2: Assessment and Reassessment Proceedings
The court emphasized that the detailed adjudication on the information available with the Assessing Officer at the stage of passing the order under Section 148A(d) was not required. The purpose was to provide a detailed procedure under Section 148 for issuance of notice, followed by determination by the assessing authority on whether income had escaped assessment. The court held that the ultimate determination was subject to appeal and that the merits of the information would be considered in the reassessment proceedings initiated through the notice under Section 148.

Conclusion:
The court found no merit in challenging the order under Section 148A(d) and the notice under Section 148. It cited a previous case to support the view that any grievance on merits should be raised before the Assessing Officer in the reassessment proceedings. Therefore, the writ petition was dismissed, with no order as to costs.

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