Dinesh Bohra V. The Union of India and The Principal Commissioner Of Income Tax-1, Jodhpur and The Assistant / Deputy Commissioner of Income Tax, Circle-2, Jodhpur

SAW/249/2020

AI Insights

The case involves Dinesh Bohra, the appellant, who challenged the assessment order and demand notice issued by the Assistant Commissioner of Income Tax, Jodhpur. The assessment was based on a limited scrutiny concerning deductions/exemptions from capital gains for the assessment year 2017-18. The appellant argued that the transition from limited to full-fledged scrutiny by the Assessing Officer was beyond jurisdiction, citing CBDT instructions. However, the court found that the scrutiny remained within the bounds of the initial notice, focusing solely on the capital gains deductions/exemptions claimed by the appellant. The appeal was dismissed based on the availability of a statutory remedy under the Income Tax Act, 1961, which the appellant was advised to pursue.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 699578 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 15-03-2021
• Assessment Year: misc
• Other Referred Cases: Genpact India Private Ltd vs. Deputy Commissioner of Income Tax & Ors.: (2019) 311 CTR (SC) 737, Commissioner of Income Tax & Ors. vs. Chhabil Dass Agarwal: (2014) 1 SCC 603
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Assessee Lawyers: SANDEEP BHANDAWAT; SHREYANSH BHANDAWAT
• Keywords: Assessment Order; Capital Gains; Jurisdiction; Limited scrutiny; Full fledged scrutiny
• Section: 143(3); 142(1); 143(2); 270A

Judgement Text

"HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Spl. Appl. Writ No. 249/2020 Dinesh Bohra S/o Soman Raj Bohra, Aged About 50 Years, J-05 Shivaji Nagar, Jalore. ----Appellant Versus 1. The Union of India, Through The Chairman of Central Board of Direct Taxes, New Delhi. 2. The Principal Commissoner Of Income Tax-1, Jodhpur 3. The Assistant / Deputy Commissioner of Income Tax, Circle-2, Jodhpur. ----Respondents For Appellant(s) : Mr. Sandeep Bhandawat with Mr.Shreyansh Bhandawat HON'BLE MR. JUSTICE SANGEET LODHA HON'BLE MR. JUSTICE RAMESHWAR VYAS Order 15/03/2021 1. This intra-Court appeal is directed against order dated 4.1.2020 passed by the learned Single Judge of this Court, whereby the writ petition preferred by the appellant against the assessment order and demand notice dated 23.12.2019 passed by the Assistant Commissioner of Income Tax, ACIT/DCIT, Circle-2, Jodhpur under Section 143 (3) of the Income Tax Act, 1961 (for short “the Act of 1961”), has been dismissed on the ground of availability of remedy of appeal under Part A of Chapter XX of the Act of 1961. 2. The appellant was served with a notice under Section 143(2) of the Act of 1961 for limited scrutiny (Computer Aided Scrutiny Selection) indicating that the return of income filed by (2 of 4) [SAW-249/2020] the appellant has been selected for limited scrutiny for examination of issue relating to deduction/exemption from capital gains. The appellant was directed to provide the details of exemption and deduction claimed by him during the assessment year 2017-18 alongwith documentary evidence supporting the claim of exemption or deduction. The aforesaid notice was followed by notice dated 29.7.2019 issued under Section 142(1) of the Act of 1961. Further information was sought vide notice dated 30.10.2019, which was responded on behalf of the appellant on 12.11.2019. Whereafter, the notice under Section 142(1) for assessment was issued on 12.12.2019. A reply to the said notice was filed by the appellant on 15.12.2019. The Assessing Officer passed the assessment order dated 23.12.2019 creating a demand of Rs.2,62,02,529/- against the appellant under Section 143(3) of the Act of 1961. That apart, the penalty proceedings under Section 270A were directed to be initiated separately. 3. Precisely, it was contended on behalf of the appellant before the learned Single Judge that as notice was issued for limited scrutiny, the scope of enquiry could not have been converted into a full fledged scrutiny and thus, the action of the Assessing Officer in passing the assessment order is ex facie without jurisdiction. It was contended that the action of the Assessing Officer in holding the full fledged scrutiny is contrary to the Instructions dated 30.11.2019 issued by the CBDT. 4. The learned Single Judge observed that a notice was issued to the appellant calling upon him to explain as to why his income should not be treated as income from business, however, no objection regarding the jurisdiction was raised on his behalf before the Assessing Officer. Relying upon the decisions of the Supreme (3 of 4) [SAW-249/2020] Court in Genpact India Private Ltd vs. Deputy Commissioner of Income Tax & Ors.: (2019) 311 CTR (SC) 737 and Commissioner of Income Tax & Ors. vs. Chhabil Dass Agarwal: (2014) 1 SCC 603, the learned Single Judge observed that since the assessment order is open to appeal under Part A of Chapter XX of the Act of 1961, the writ petition cannot be entertained. 5. Learned counsel appearing for the appellant reiterating the contention raised before the learned Single Judge, submitted that since ‘limited scrutiny’ was initiated, the Assessing Officer could not have entered into ‘complete scrutiny’ and thus, the action of the Assessing Officer in passing the assessment order is ex facie without jurisdiction and thus, the learned Single Judge has seriously erred in dismissing the writ petition on the ground of availability of remedy of appeal. 6. Indisputably, the return of the income filed by the appellant for assessment year 2017-18 was selected for limited scrutiny in respect of deduction/exemption from capital gains and accordingly, he was directed to provide the details of exemption and deduction claimed by him during the year under consideration alongwith documentary evidences which can support his claim for such exemption or deduction. The notices placed on record in no manner reflect that while issuing the notice for ‘limited scrutiny’, the Assessing Officer entered into ‘complete scrutiny’ rather, the scrutiny was confined to appellant’s claim of deduction/exemption from capital gains. Further, the notice for assessment was issued to the appellant only with regard to the exemption/deduction of capital gains and accordingly, the assessment order has been passed. Thus, the objection sought to be raised by the appellant that the Assessing Officer entered into a full fledged enquiry into (4 of 4) [SAW-249/2020] the issues not covered by limited scrutiny, prima facie, does not appear to be correct. In any case, no objection regarding the jurisdiction of the Assessing Officer in passing the assessment order was ever questioned by the appellant by way of the response to the notice filed. It is open for the appellant to raise the question regarding jurisdiction of Assessing Officer in passing assessment order, before the Appellate Authority. In this view of the matter, in the considered opinion of this Court, the learned Single Judge has committed no error in dismissing the writ petition on the ground of availability of remedy of appeal under the provisions of the Act of 1961. 7. The intra-Court appeal is therefore, dismissed. (RAMESHWAR VYAS),J (SANGEET LODHA),J 9-Aditya/- "