TaxTMI 
TaxTMI 
2006 (8) TMI 145
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....tion in the nature of mandamus directing respondents Nos. 2 and 3 to stop the proceedings of special audit for the assessment year 2003-04. (iii) To issue any other writ or order which this hon'ble court may deem fit and proper in the circumstances of the case. (iv) To award the cost of the petition to the petitioner." Briefly stated the facts giving rise to the present writ petition are as follows. According to the petitioner, it is a co-operative society registered under the provisions of the U. P. Co-operative Societies Act, 1965, with its registered office at Ghaziabad. It has also been authorised by the Reserve Bank of India to carry on banking activities in the State of Uttar Pradesh. It has also been permitted to open bra....
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....now the reasons and the circumstances under which the said auditor has been appointed. The reasons have not been supplied. The petitioner has approached this court challenging the order by which the special auditor has been appointed on the ground that respondent No.3 did not have any material before him for forming an opinion regarding the nature and complexity of the accounts of the petitioner and further the interests of the Revenue was not to be affected inasmuch as the accounts of the petitionerbank had been statutorily audited both under the provisions of the U. P. Co-operative Societies Act, 1965, as also under section 44AB of the Act. In the counter affidavit filed by Shri Lala Ram, inspector working in the office of the Addition....
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.... of Income-tax had examined the proposal of respondent No. 3 and communicated the approval for appointment of M/s. Banshal Gupta and Associates as special auditor under section 142(2A) of the Act vide letter dated March 27, 2006, which was communicated to the petitioner. In the rejoinder affidavit, it has been stated that recourse to section 142(2A) of the Act was not legally permissible as the petitioner was cooperating in the assessment proceedings and further in the immediately preceding assessment year, i.e., 2002-03, no order for appointment of special auditor was passed under section 142(2A) of the Act and the assessment was made in a routine manner. We have heard Shri Rishi Raj Kapoor, learned counsel for the petitioner and Shr....
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.... of the Act. In support of his plea, he has relied upon a decision of a learned single judge of the Calcutta High Court in the case of West Bengal State Cooperative Bank Ltd. v. Joint CIT [2004] 267 ITR 345. Shri R. K. Upadhayay, learned standing counsel, on the other hand, submitted that it is not in dispute that in the previous assessment year, the accounts of the petitioner-bank have been subjected to special audit under section 142(2A) of the Act and merely because in the immediately preceding assessment year, i.e., 2002-03, no such order was passed, it would not make any difference. He submitted that as the assessee was not co-operating and not furnishing the required details and was not producing its books of account and other d....
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....sment proceedings in the assessment year 2003-04 had commenced with the issuance of the notice under section 142(1) of the Act on October 25, 2005. The petitioner was required to furnish details and other explanations and produce the books of account and other documents. Several dates were fixed and the proceedings had been adjourned at the instance of the petitioner. Full compliance had not been given to the various notices seeking information from the petitioner. It is also not in dispute that in the earlier assessment years excluding the immediate preceding year 2002-03, the accounts of the petitioner had been subjected to special audit under section 142(2A) of the Act. Respondent No.3, who is the assessing authority of the petitioner to....
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....ct, 1961, shows that all that is required therein is that the Assessing Officer should be of the opinion that in view of the nature and complexity of the accounts of the assessee and the interest of the Revenue it is necessary to direct special audit of the assessee's account. It is not necessary for the Assessing Officer to give a show cause notice or a hearing to the assessee before issuing the direction under section 142(2A). The direction under sub-section (2A) of section 142 is purely administrative in nature and not quasi-judicial. Moreover, such a direction does not have civil consequences. It does not affect the assessee's right or liability. The purpose of the direction under sub-section (2A) of section 142 is to ensure that a c....