Smt. Kusum Gupta V. Union of India and Another

WP(C)/2008/2021

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Smt. Kusum Gupta filed a writ petition challenging the notices issued to her under Section 153A of the Income Tax Act, 1961, for the assessment years 2012-13 and 2013-14. The notices were based on an 'agreement to sell' document which indicated a transaction involving a property purchase for Rs. 80,00,000, which was deemed to have escaped assessment. The petitioner argued that the notices were without jurisdiction as the Assessing Authority lacked material evidence to support the claim that her income had escaped assessment of Rs. 50.00 lakhs or more. However, the court found that the documents in possession of the Assessing Authority were sufficient to justify the notices, and the petitioner had acquiesced to the notices by filing revised returns, thus accepting their validity.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 813224 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 04-10-2021
• Assessment Year: misc
• Other Referred Cases: Calcutta Discount Limited vs. Income Tax Officer, Companies District I, Calcutta and Anr
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: PARIKSHA PARMAR
• Assessee Lawyers: A H NAIK; RUPINDER SINGH
• Keywords: Assessment years; Escaped assessment; Jurisdiction; Quashing notices; Search warrant; Writ jurisdiction
• Section: 153A

Judgement Text

" Sr. No.5 HIGH COURT OF JAMMU & KASHMIR AND LADAKH AT JAMMU CJ Court Case: WP (C) No.2008 of 2021 Smt. Kusum Gupta …Petitioner(s)/Appellant(s) Through: Sh. A H Naik, Senior Advocate with Sh. Rupinder Singh, Advocate. V/s Union of India and Another …. Respondent(s) Through: Ms. Pariksha Parmar, Advocate vice Smt. Aruna Thakur, Advocate. CORAM: HON’BLE THE CHIEF JUSTICE HON’BLE MR. JUSTICE RAJNESH OSWAL, JUDGE ORDER 1. Heard Sh. A.H.Naik, senior counsel assisted by Sh. Rupinder Singh, learned counsel for the petitioner and Ms. Pariksha Parmar, learned counsel appearing vice Smt. Aruna Thakur, learned counsel for the respondents. 2. The petitioner has invoked the writ jurisdiction of this Court for the purposes of quashing the notices dated 18.02.2021 issued to her under Section 153A of the Income Tax Act, 1961 (for short ‘the Act’) for the assessment years 2012-13 and 2013-14. 3. Sh. Naik, senior counsel for the petitioner submitted that the aforesaid notices are without jurisdiction as the Assessing Authority is not in possession of any material on the basis of which he can form an opinion that the income of the petitioner has escaped assessment likely to be of the amount of Rs. 50.00 lakhs or more in the relevant assessment years. In this connection, he has relied on the 4th proviso to Section 153A of the Act and a decision of the Supreme Court in the case of ‘Calcutta Discount Limited 2 Company vs. Income Tax Officer, Companies District I, Calcutta and Anr’, (1961) 41 ITR 191 (SC), to submit that in the absence of any material and the satisfaction so recorded, the notice would be deemed to be without jurisdiction. 4. Section 153A of the Act is applicable in cases of search and where books of accounts, other documents or any assets are requisitioned so as to empower the Assessing Authority to issue to notice requiring the assessee to furnish the revised returns of income in respect of the assessment years of the preceding six years as if such returns were returns furnished under Section 139 of the Act. The aforesaid provision vide clause (a) of the 4th proviso lays down that no such notice would be issued unless the Assessing Authority has in its possession books of account or other documents or evidence which may reveal that the income represented in the form of asset has escaped assessment of likely amount of Rs. 50.00 lakhs or more in the relevant year. 5. In view of the above provision, a notice under Section 153A of the Act for filing revised return is contemplated only if the Assessing Officer on the basis of the material in his possession is satisfied that the income has escaped assessment likely to be of an amount of Rs. 50.00 lakhs or more. 6. In the instant case, the Assessing Authority in issuing the impugned notices under Section 153A of the Act has recorded his satisfaction in the following way as is evident from Annexure-I to the writ petition. “The document is photocopy of “agreement to sell” dated 18.10.2011 between Smt. Satya Devi W/o Late Sh. Balwan Singh R/o Village Pamote Tehsil & District Reasi (seller) and 1) Smt. Kusum Gupta W/o Sh. Sneh Gupta 2) Uma Mahajan W/o Sh. Janak Raj Gupta, both residents of 62 A/D Gandhi Nagar Jammu (Buyers) regarding purchase of land measuring 80 kanals underlying khasra No. 705 khewat No. 47/24 & 3 khewat No.21 situate at Pamote, Tehsil and District Reasi for sale consideration of Rs. 80,00,000/ (Rupees Eighty lacs). As per the said documents, advance payment of Rs. 8,00,000/- has been already made by the buyer to the seller vide cheque No.496018 dated 18.10.2011 of J&K Bank Shalimar Road Jammu and the balance payments was agreed to be received within a period of three months. Since the value of the asset/property exceeds Rs. 50/- lacs and the agreement is dated 18.10.2011 and advance payment of Rs. 8,00,000/ also dated 18.10.2011, therefore, the said assessment year i.e. A.Y 2012-13 (F.A. 2011-12) falls within the relevant assessment year as per sub section (1) Explanation -1 of Section 153A of the IT Act, 1961 and the said asset/income has escaped assessment for the relevant assessment years. Accordingly, keeping in view the same, and the fact the case is covered under Search warrant, notice u/s 153A of the IT Act, 1961is being issued to the assessee for the A.Y 2012-13 and 2013-14 as per law as the said assessment years falls within 10 years from the assessment year relevant to the previous year in which search was conducted.” 7. The petitioner has brought on record the copy of the Agreement to Sell dated 18th October 2011 which is referred to in the above note and is also in possession of the Assessing Authority. 8. A reading of the aforesaid note along with the Agreement to Sell would reveal that the petitioner had entered into an agreement to purchase a piece of land for a sum of Rs. 80.00 lakhs out of which Rs. 8.00 lakhs were paid and the remaining amount of Rs. 72.00 lakhs was to be paid on or before the execution of the sale deed. 9. In other words, the said documents clearly make out a case of likely investment of the petitioner in the relevant year to the extent of Rs. 80.00 lakhs, may be that for some reason, the agreement could not be performed and the petitioner may have to resort to lodging of an FIR against 4 the vendor named therein, but the aforesaid documents sufficiently reveal that the petitioner intended to acquire an asset worth Rs. 80.00 lakhs in the relevant year and the said asset has escaped assessment. The said assessment/satisfaction of the Assessing Authority may not be correct or justified, nonetheless, he was possessed of the documents to form an opinion that the income worth over Rs. 50.00 lakhs or above has escaped assessment. Thus, not only he was possessed of the relevant documents but has also recorded his satisfaction regarding escapement of assessment to the tune of over Rs. 50.00 lakhs. Accordingly, it is not a case where ex facie it can be said that the notice is without jurisdiction. 10. In this context, it may be relevant to note that in response to the aforesaid notices, the petitioner has already filed revised returns and the matter is pending assessment. Once the petitioner has already filed revised returns, he has accepted or acquiesced to the notices and, as such, is estopped from challenging the same. 11. In view of the aforesaid facts and circumstances, we do not deem it necessary to exercise our discretionary jurisdiction in the matter and the writ petition is dismissed with no order as to costs. (RAJNESH OSWAL) (PANKAJ MITHAL) JUDGE CHIEF JUSTICE MITHAL) JUDGE CHIEF JUSTICE Jammu 04.10.2021 Tilak Whether the order is speaking? Yes/No Whether the order is reportable? Yes/No "