M/s. Kothari Metals Omkar House V. Income Tax Officer Ward 1(4)

WP/14670/2014

AI Insights

The case involves M/s Kothari Metals, represented by its proprietor Mr. Suresh Kumar Kothari, who filed a writ petition against the Income Tax Officer, Ward 1(4), challenging the reassessment order and the subsequent notice of demand for the Assessment Year 2006-07. The petitioner argued that the reassessment was initiated without assigning any reasons, which is a prerequisite for reopening an assessment under the Income Tax Act. The respondent contended that the reasons for reassessment would be clear upon the filing of the return as requested under Section 148 of the Act. The court decided not to intervene at this preliminary stage and directed the petitioner to approach the Appellate Authority.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 671096 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 11-12-2014
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: VINAY
• Keywords: Assessment Order; Income Tax; Notice of demand; Re-assessment; Writ petition
• Section: 147; 148; 143(3); 142(1)

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA, BANGALORE DATED THIS THE 11TH DAY OF DECEMBER, 2014 BEFORE THE HON'BLE MR. JUSTICE HULUVADI G. RAMESH WRIT PETITION NO.14670 OF 2014 (T-IT) BETWEEN: M/S.KOTHARI METALS OMKAR HOUSE, NO.8/1 4TH CROSS, KALASIPALYAM NEW EXTENSION BANGALORE – 560 002. REP. BY ITS PROPRIETOR MR.SURESH KUMAR KOTHARI S/O.SHA POONAMCHAND GALBAJI AGED ABOUT 40 YEARS. ... PETITIONER (BY SRI.VINAY.V, ADV.,) AND: INCOME TAX OFFICER WARD 1(4) HMT BHAVAN BANGALORE – 560 032. ... RESPONDENT (BY SRI K.V.ARAVIND, ADV.,) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ASSESSMENT ORDER PASSED BY THE RESPONDENT U/S.143(3) R.W.SECTION 147 OF THE INCOME TAX ACT, 1961 DATED 31-01-2014 FOR THE ASSESSMENT YEAR 2006-07 I.E., ANNEXURE-D AND CONSEQUENTIAL NOTICE OF DEMAND ISSUED BY THE 2 RESPONDENT IN FORM -7 DATED 31-01-2014 FOR THE ASSESSMENT YEAR 2006-07 I.E., ANNEXURE-E. THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING: ORDER The petitioner has sought to quash the impugned assessment order passed by the respondent under Section 143 (3) read with Section 147 of the Income Tax Act, 1961, (hereinafter referred to as the ‘Act’) for the Assessment Year 2006-07 at Annexure-D and consequential notice of demand issued by the respondent in Form-7 dated 31.1.2014 for the Assessment Year 2006-07 at Annexure-E and for such other relief. 2. The petitioner is an individual engaged in the business of trading in iron and steel under the name and style of M/s Kothari Metals. The petitioner filed his return of income for the Assessment Year 2006-07 on 19.6.2006 declaring an income of Rs.2,13,700/- and the said return was accepted under Section 143(1) of the 3 Act on 14.06.2007. Subsequently, the respondent issued a notice under Section 148 of the Act on 28.3.2013 for re-opening of the assessment by requesting the petitioner to file return of income for the said year. In response to the said notice, the petitioner requested the respondent to treat the earlier return filed as return filed in response to the notice issued under Section 148 of the Act. Subsequently, the respondent commenced the proceeding by issuance of questionnaire under Section 142(1) of the Act. 3. The learned counsel for the petitioner submits that the respondent has failed to assign reason for re- opening the assessment which is a condition precedent for such re-opening and also the respondent has not intimated the same to the petitioner even though the petitioner has participated in the re-assessment proceedings. Hence, the petitioner is before this Court. 4. Heard the learned counsel appearing for the respective parties. 4 5. The grievance of the petitioner is that already income tax return is filed for the Assessment Year 2006- 07 which is well within time and the same has been accepted by the respondent-Authority and without assigning any reason, the notice has been issued on 28.3.2013 for re-opening the assessment. According to the counsel, such a reason is necessary for re-opening the assessment. 6. The learned counsel appearing for the respondent-Authority submitted that once the petitioner has filed the income tax return for the Assessment Year 2006-07 and now he is seeking for reason for re-filing the same. It is further submitted that only when doing re-filing, reasons could be assigned, but not earlier. As per Annexure-D there is an assessment order passed, since the petitioner did not file another return as sought for by the respondent-Authority under Section 148 of the Act. It is submitted by the learned counsel for the respondent-Authority that the reassessment made by the Revenue could be challenged before the Appellate 5 Authority. Hence, it is too premature for the petitioner to approach this Court. 7. The reasons to be assigned for the purpose of re-filing which is sought by the petitioner herein, could be considered after filing of the return once again as per the notice issued under Section 148 of the Act. Therefore, it is for the petitioner to approach the Appellate Authority within two months as per the proviso under Sec.146(a) of the Act. With the above direction, the petition is disposed of. Sd/- JUDGE PB "