Ms Maa Kali Alloys Udyog Private Limited Through Its Director Deepak Kumar Poddar V. Union Of India Through The Secretary Ministry Of Finance Deptt Of Revenue And Ors

WPC/3368/2017

AI Insights

M/s Maa Kali Alloys Udyog Private Limited filed a writ petition against the Union of India and other income tax authorities challenging a notice for re-assessment under Section 148 of the Income Tax Act, 1961, for the assessment year 2010-2011. The notice was based on findings that the company received Rs. 6.25 crores through share applications from fictitious companies, which was not disclosed in the original assessment. The High Court of Jharkhand dismissed the petition, upholding the notice and the subsequent re-assessment proceedings, citing the failure of the petitioner to disclose significant facts and the presence of escaped income.

• Counselvise Citation: [2018] 140 COUNSELVISE.COM (IT) 725703 (HC-JHARKHAND)
• Appeal Type: Others
• Pronouncement Date: 30-10-2018
• Assessment Year: misc
• Other Referred Cases: W.P.(C) No.1357 of 2016, (2017) 396 ITR 5 (Del), (2017) 394 ITR 146 (Guj)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: DEEPAK ROSHAN
• Assessee Lawyers: DARSHANA MISHRA
• Keywords: Bogus companies; Escaped income; Notice under section 148; Reassessment; Share application
• Section: 147; 148

Judgement Text

"1 IN THE HIGH COURT OF JHARKHAND AT RANCHI W.P. (T) No. 3368 of 2017 M/s Maa Kali Alloys Udyog Private Limited, a limited liability company within the meaning of the Companies Act, 2013 having its Registered Office at 46A, 2nd Floor, P.O. Rafi Ahmed Kidwai Road, P.S. & District- Kolkata – 700 016 (WB), through its Director Deepak Kumar Poddar, Son of Sanwar Mal Poddar, Resident of Joraphatak Road, Dhansar, P.O., P.S. & District- Dhanbad - 828106 … Petitioner -Versus- 1. Union of India, through the Secretary, Ministry of Finance, Department of Revenue having its Office at the Central Secretariat, North Block, P.O., P.S and District- New Delhi 2. Commissioner of Income Tax, Central Circle, Central Revenue Building, 3rd Floor, Birchand Patel Marg, P.O. & P.S. Kotwali, District- Patna, 800001 3. Deputy Commissioner of Income Tax, Central Circle, Dhanbad having its Office at Luby Circular Road, P.O., P.S and District Dhanbad 4. Assistant Commissioner of Income Tax, Central Circle, Dhanbad having its Office at 3rd Floor, Aaykar Bhawan, Luby Circular Road, P.O., P.S and District- Dhanbad, 826 001 ... Respondents ----- CORAM: HON’BLE MR. JUSTICE D.N. PATEL HON'BLE MR. JUSTICE AMITAV K. GUPTA ----- For the Petitioner : Mrs. Darshana Poddar Mishra, Advocate For the Respondents : Mr. Deepak Roshan, Advocate ----- 09 /Dated : 30 th October, 2018 Oral Order Per D.N. Patel, J. 1. This matter is today again listed because the file was not traceable by the stenographer of this Court, who has taken dictation, namely, Mr. Chandan Kumar, Sr. P.A. on 18th December, 2017 in the open Court and, therefore, he could not place the typed copy of the order before us for few months. The writ petition was dismissed with cost of Rs.5,00,000/-. 2. The said stenographer placed the typed copy of the final order passed in the aforesaid writ petition before us on 24th October, 2018. 3. One of us (Hon'ble Mr. Justice D.N. Patel) has already informed Hon'ble the Chief Justice of this Court to take an administrative action against the erring officer(s) including Mr. Chandan Kumar, Sr. P.A. The inquiry is going on. 2 4. The aforesaid writ petition was disposed of by this Court in the open Court by the dictation of the following order: “08/Dated: 18 th December, 2017 Oral Order: Per D.N. Patel, A.C.J 1. This writ petition has been preferred with the following prayers:- (a) For a direction upon the concerned Respondent especially the Respondent no.4 to forthwith withdraw, recall, cancel and / or rescind the purported Notice dated 23.03.2017 (Annexure – 10) issued under Section 148 of the Income Tax Act, 1961 initiating proceedings for reassessment under Section 147 of the Act for the Assessment year 2010-11 and to quash and /or set aside the Order dated 15.05.2017 (Annexure – 12) passed by the Respondent no.4 and all purported proceedings relating thereto an to act in accordance with law; (b) For a direction upon the Respondent no.4 to transmit and certify the records relating to the purported Notice dated 23.03.2017 (Annexure – 10) issued under Section 148 of the Act initiating proceedings for reassessment under Section 147 of the Act for the Assessment Year 2010-11 and to quash and/or set aside the Order dated 15.05.2017 passed by the Respondent no.1 and all purported proceedings relating thereto may be set aside and quashed. (c) For a direction upon the Respondent no.4 to forbear from giving any effect to and/ or further effect to and /or taking any step whatsoever on the basis of the said purported Notice dated 23.03.2017 (Annexure–10) issued under Section 148 of the Act initiating proceedings for reassessment under Section 147 of the Act for the Assessment Year 2010-112 and to quash and/or set aside the Order 3 dated 15.05.2017 passed by the Respondent no.1 and all proceedings relating thereto.” 2. Having heard learned counsels for both the sides and looking to the facts and circumstances of the case, it appears that for the assessment year 2010-2011, assessment proceedings were completed on 23.03.2011 and the assessed income was Rs.3,51,453/-. 3. It further appears from the facts of the case that for the assessment year 2011- 2012, C.I.T (Appeals) initiated enquiry and ultimately report was given by the Deputy Director (Investigation) Income Tax Unit - 2(2), Kolkata and several facts have been pointed out in the said report. 4. It further appears that this assessee had received an amount of Rs.6.25 crores through share applications from the bogus/ fictitious/ paper companies. During enquiry it has been found out that they have also given their statements and accommodative entries were given by them. They have given their undertaking also. 5. Thus, on the basis of the enquiry conducted by the Deputy Director (Investigation) Income Tax Unit - 2(2), Kolkata and also looking to the statements collected through this enquiry and also looking to the undertaking about the accommodation of the entries, the Assessing Officer has arrived at a conclusion that there is escaped income and the assessee–petitioner has failed to disclose his income for the assessment year 2010–2011. Notice has been given under Section 148 of the Income Tax Act, 1961, dated 23.03.2017, for re-assessment. 6. Having heard learned counsels for the parties and looking to the Annexure – 10 dated 23.03.2017, we are not inclined to entertain this 4 writ petition mainly for the reason that there is already investigation carried out by the Deputy Director (Investigation) Income Tax Unit - 2(2), Kolkata wherein statements have also been recorded, undertakings have also been collected and Rs.6.25 crores have been collected by this petitioner - assessee through paper/ bogus/ fictitious companies and these facts were never disclosed by this assessee as alleged in the said notice under Section 148 of the Income Tax Act, 1961, for the assessment years 2010–2011. There is also huge escaped income. These facts are sufficient for giving a notice under Section 148 of the Income Tax Act, 1961. 7. Counsel appearing for the petitioner has relied upon the decisions delivered by the Hon'ble Delhi High Court in W.P.(C) No.1357 of 2016, order dated 25.09.2017 as well as judgment delivered by the Hon'ble High Court of Delhi, reported in (2017) 396 ITR 5 (Del) and the decision rendered by Hon'ble the Gujarat High Court reported in (2017) 394 ITR 146 (Guj). Looking to the peculiar facts of the present case, it appears that there was no discloser of the facts about 21 companies from where Rs.6.25 crores were received of the share money. This companies are fictitious and paper companies and several statements and undertakings have been collected during the course of investigation. This fact makes the present case different, from the facts of the aforesaid reported and unreported decisions, upon which reliance is placed by the counsel for the petitioner and thus they are of no help to the petitioner. 8. Much has been argued by the counsel for the petitioner about the facts disclosed by this assessee regarding lapse of 4 years period from 5 2010 – 2011 and reliance is placed upon the enquiry conducted by the Deputy Director (Investigation) Income Tax Unit - 2(2), Kolkata, and much has also been argued about the fact that there is no independent application of mind. 9. None of these contentions is acceptable by this Court. Looking to Section 148 notice at Annexure – 10 dated 23.03.2017, there is application of mind. Prima facie, nothing is beyond the period of limitation and prima facie there was failure on the part of the assessee to disclose the facts which have been investigated by a team of investigation of the Income Tax Department and prima facie, there is escaped income for the assessment year 2010–2011 and, hence, we see no reason to entertain this writ petition at this stage. 10. It appears that this petitioner wants to delay re-assessment proceedings so that again it may be time barred as per Section 153 of the Income Tax Act. Whenever time bound schedule is given by the Income Tax Act, then time management has to be followed by the respondent – Department. Such type of writ petitioner is just a chance taking petitioner. 11. Thus, there is no substance in this writ petition, and hence, the same is, hereby, dismissed with a cost of Rs.5,00,000/- (Rupees five lakhs), which shall be deposited by this petitioner before the Secretary, Department of Women & Child Development and Social Security, Government of Jharkhand, Ranchi, in A/c No.3734498462-5 (Jharkhand Juvenile Justice Fund), State Bank of India, Project Bhawan, Hatia, within a period of six weeks from today towards the Juvenile Justice Fund. The aforesaid amount shall be utilized for the welfare of the 6 juveniles as per the duties assigned to the State under the Juvenile Justice (Care and Protection of Children) Act, 2015. 12. Copy of this order will be sent to :- (a) the Secretary, Department of Women and Child Development & Social Welfare, Government of Jharkhand, Ranchi, and (b) the Member Secretary, Jharkhand State Legal Services Authority, Nyaya Sadan, Doranda, Ranchi. (D. N. Patel, A.C.J) (Amitav K. Gupta, J) Dey – Chandan/-” 5. We are disposing of the matter today by the same order. This matter shall be deemed to be dismissed today. The first set of W.P.(T) No. 3368 of 2017, which is misplaced, shall now be reconstructed by the Registry of this Court. 6. With the aforesaid observations, this writ petition is, hereby, disposed of. (D.N. Patel, J.) (Amitav K. Gupta, J.) Ajay/ "