Court dismisses petition to quash tax notice, stresses proper assessment procedures.

The court dismissed the petitioner's request to quash the notice under section 148 of the Income-tax Act and awarded no compensation. It emphasized the necessity for the Assessing Officer to pass a speaking order on objections filed by the assessee and highlighted the limits on reopening assessment proceedings based solely on a change of opinion. The court directed the authorities to consider the objections promptly and reiterated the availability of statutory remedies for the petitioner. The judgment underscored the importance of proper consideration of objections and the legality of the notice issued under section 148.

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Issues:
1. Quashing of notice under section 148 of the Income-tax Act
2. Awarding compensation and costs for inconvenience and harassment caused
3. Legality of notice issuance and objections filed by the petitioner
4. Jurisdiction of the court under article 226 of the Constitution of India
5. Reopening of assessment proceedings based on change of opinion
6. Availability of statutory remedy for the petitioner
7. Lack of inherent jurisdiction in the notice issued under section 148

Analysis:

1. The petitioner sought the quashing of the notice dated May 20, 2004, under section 148 of the Income-tax Act for various assessment years. The petitioner also requested compensation for the inconvenience caused. The court noted that the petitioner had previously filed a writ petition, which was disposed of with liberty to file an appeal. The petitioner filed detailed objections to the notice, challenging its legality and merits.

2. The petitioner contended that it was not necessary to await the disposal of objections by the authorities before approaching the court under article 226 of the Constitution of India. The Revenue argued that the writ petition was an abuse of process and the petitioner should wait for the assessment order and avail of statutory remedies. The court emphasized the importance of passing a speaking order on objections filed by the assessee.

3. The court referred to previous judgments to establish that reopening assessment proceedings based on a mere change of opinion is not permissible. It highlighted the necessity for the Assessing Officer to consider objections and pass a speaking order. The court reiterated that the jurisdiction of the court under article 226 would not be debarred if the action complained of is without jurisdiction or patently illegal.

4. The court emphasized that the Assessing Officer must pass a speaking order in response to objections filed by the assessee. The petitioner's objections focused on the justification for the notice under section 148, rather than lack of jurisdiction. The court directed the authorities to consider the objections and pass a speaking order expeditiously.

5. The court concluded that the petitioner had the right to question the legality or validity of the order in appropriate proceedings. The writ petition was disposed of, with each party bearing their own costs. The court's decision was in line with previous judgments and the principles of law governing the reopening of assessment proceedings.

6. Overall, the judgment focused on the legality of the notice issued under section 148, the importance of passing a speaking order on objections, and the availability of statutory remedies for the petitioner. The court emphasized the need for proper consideration of objections and highlighted the limits of reopening assessment proceedings based on a change of opinion.

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