2023 (8) TMI 1591 - HC - Income Tax

Notice u/s 148 of Income Tax Act Quashed for Lack of Clarity and Fresh Evidence for Assessment Year 2012-2013.

The HC quashed and set aside the notice issued under Section 148 of the Income Tax Act for the Assessment Year 2012-2013. The Court found the reasons in ... Reopening of assessment u/s 147 - unsecured loan given to a corporation - information had been received from the Income Tax Officer, Ward No.9(2), Ahmedabad, which revealed that the assessee had given an unsecured loan during the year under consideration - HELD THAT:- There was infact no material available and there was justifiable reason to indicate on the basis of the long term capital gain statement, copies of the documents of the land in question, copies of the ledger account of Bhumi Corporation etc., to suggest that the loan was advanced to M/s. Bhumi Corporation and that the transaction was genuine. He would also invite the Court’s attention to the Statement of Accounts to indicate the worth of the petitioner. Thus, in light of the decision of Jayesh Govind bhai Bala [2016 (6) TMI 700 - GUJARAT HIGH COURT] in absence of any evidence and fresh material on record, we find that the reasons indicated by the author of the notice are vague and presumptuous. On this ground alone, the impugned notice is quashed and set aside. Issues:Challenge to notice under Section 148 of the Income Tax Act for Assessment Year 2012-2013 based on alleged escapement of income due to unsecured loan given to a corporation.Analysis:The petitioner filed a return for the Assessment Year 2012-2013, showing income and taxes paid. Subsequently, a notice under Section 148 of the Income Tax Act was issued, alleging that income chargeable to tax had escaped assessment due to an unsecured loan given to a corporation. The Assessing Officer relied on information received regarding the loan. The petitioner challenged the notice, arguing that there was no fresh evidence to prove the genuineness of the transaction. The petitioner highlighted objections filed, emphasizing the lack of material to support the claim. The respondent, represented by counsel, opposed the petition, asserting that there was insufficient evidence to establish the transaction's genuineness.In the judgment, the Court considered the arguments presented by both parties, along with the objections raised by the petitioner. Referring to a previous decision of the Division Bench, the Court found the reasons provided in the notice to be vague and presumptuous, lacking fresh material or evidence. Consequently, the Court quashed and set aside the impugned notice, allowing the petition and making the rule absolute.