The court emphasized the importance of correct premise, sharing of relevant information, and clear understanding of the provisions of the Income Tax Act, 1961 in reassessment proceedings.

JUDGMENT

Rajiv Shakdher, J. (Oral)

CM Appl.18001/2023

1. Allowed, subject to just exceptions.

W.P.(C) 4668/2023 & CM Appl.18000/2023 [Application filed on behalf of the petitioner seeking interim relief]

2. Issue notice.

2.1. Mr Sunil Agarwal, senior standing counsel, accepts notice on behalf of the respondents/revenue.

3. In view of the directions that we propose to pass, Mr Agarwal says that a counter-affidavit is not required to be filed and he will argue based on the record presently available with the court. Therefore, with the consent of the counsels for the parties, the writ petition is taken up for final hearing and disposal, at this stage itself.

4. This writ petition is directed against the notice dated 17.03.2023 issued under Section 148A(b) of the Income Tax Act, 1961 [in short, "the Act"].

4.1. Besides this, challenge is also laid to the order dated 31.03.2023 passed under Section 148A(d) and the consequential notice of even date i.e., 31.03.2023 issued under Section 148 of the Act.

5. The impugned order and notices concern Assessment Year (AY) 2016-17.

6. The record shows that the Assessing Officer (AO) proceeded to issue the notice dated 17.03.2023 under Section 148A(b) of the Act based on a premise that the petitioner had not filed his return for the AY in issue.

7. The AO, thus, having obtained information from the Insight Portal System of the Income Tax Department, confronted the petitioner via the said notice with regard to the income which had escaped assessment. The information put to the petitioner was the following:

8. In response to the notice issued under Section 148A(b) of the Act dated 17.03.2023, the petitioner filed a response dated 24.03.2023, whereby he sought accommodation to file a reply to the notice issued under Section 148A(b) of the Act. The petitioner sought time to file a reply till 05.04.2023.

9. The record indicates that a fresh notice under Section 148A(b) of the Act was issued by the AO on 25.03.2023, wherein the petitioner was accorded time to file a reply to the notice on or before 27.03.2023.

9.1. Apart from this, the AO extended the time to file a reply vis-a-vis the notice dated 17.03.2023. The AO indicated that reply could be filed "before or on 27.03.2023 by 11 AM".

9.2. The AO in this notice also adverted to the fact that limitation qua the petitioner was expiring on 31.03.2023.

10. Concededly, the petitioner was not able to file the reply within the time allocated by the AO. It appears that the time given was short, and the reasons given by the petitioner on 24.03.2023 as to why he wanted extension of time continued to obtain.

10.1. Inter alia, the petitioner had indicated on 24.03.2023, that he is a senior citizen and was suffering from various ailments.

10.2. Furthermore, the petitioner also indicated that he was involved in litigation with his tenant concerning his house, and therefore, was living with his relatives. The submission was that, he was, presently, bedevilled with circumstances which were unsettling.

11. Suffice it to state that the AO, based on his understanding of the provisions of the Act, passed an order dated 31.03.2023 under Section 148A(d) of the Act.

12. In the said order, the AO made a course correction, to the extent that he noticed the fact that the petitioner had filed a return for the AY in issue. Having noticed this aspect of the matter, the AO adverted to the aspects which were not referred to in the notice issued under Section 148A