Writ petition dismissed challenging Section 147 assessment reopening for non-filing of regular return under Section 139

HC dismissed the writ petition challenging reopening of assessment under Section 147. Petitioner had not filed regular return under Section 139 for AY 2016-17. Court held that Assessing Officer was within jurisdictional powers under Sections 148-149 before issuing notice under Section 148, as escapement exceeded 50 lakhs under Section 50C. Court directed petitioner to file proper reply to Section 148 notice rather than challenging through writ. AO directed to consider all relevant facts and pass appropriate orders within three months.

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Issues:
The judgment deals with the reopening of assessment under section 148A(d) of the Income Tax Act, 1961 based on the notice issued under section 148 of the IT Act.

Relevant Details:
The impugned order dated 31.03.2023 stated that the conditions under section 149(1)(b) were satisfied for reopening the assessment as no return of income was filed for the year under consideration. The petitioner had paid a sum of Rs. 39,00,000/- prior to filing the suit in O.S.No.436 of 2014. The suit was decreed, and the Sale Deed was executed in favor of the petitioner. The petitioner argued that the invocation of Section 148A(b) was defeated as the petitioner had paid only Rs. 1,00,000/- during the Assessment Year 2016-2017. The respondents contended that the notice under Section 148 was issued after due consideration as the petitioner had not filed returns for the said year.

The petitioner relied on the first proviso to Section 50C of the Income Tax Act, 1961, which allows the value assessed by the stamp valuation authority on the date of agreement to be considered for computing the full value of consideration for transfer. The respondents argued that the provisions of Section 50C were applicable as the fair market value of the property was Rs. 64,00,000/-. The Assessing Officer followed the necessary procedures before invoking Section 148 and had information about the property purchase.

The court noted that the petitioner had not filed a regular return under Section 139 of the Income Tax Act for the assessment year in question. It was suggested that the petitioner file a proper reply to the notice issued under Section 148 to address the proposed proceedings. The Assessing Officer was directed to consider all relevant facts before concluding whether any income had escaped assessment for the relevant year. The writ petition was dismissed with observations, and no costs were awarded.

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