Point of Law : Formation of belief by the Assessing Officer at the stage of initiation of action under section 147 of the Act is within the realm of subjective satisfaction.

JUDGMENT :

ASHOKKUMAR C. JOSHI, J.

1. This petition, under Articles 226 and 227 of the Constitution of India, is filed by petitioner - Geetaben Dineshchandra Gupta challenging the notice dated 27.03.2019, issued under section 148 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) proposing to reopen the assessment of the petitioner for the Assessment Year 2012-13.

2. The facts of the case in nutshell are that the petitioner as individual filed Return of Income (Rol) for the year 2012-13, which was thoroughly processed by the respondent and subsequently, scrutiny assessment under Section 143(3) of the Act was also framed. The petitioner filed Rol at Rs.1,42,694/- on 28.09.2012. On 13.08.2013, notice under Section 143(2) of the Act came to be issued to provide certain documents. On 22.07.2014 and subsequently, on 05.08.2014, the petitioner received notices under section 142(1) of the Act, to which, the petitioner filed detailed reply on 04.09.2014. The respondent passed Assessment Order under section 143(3) of the Act on 14.10.2014. It is contended that despite the petitioner fully and truly disclosed all material facts relevant for his assessment during the course of scrutiny assessment along with statement of income with annexures, the petitioner surprisingly received notice dated 27.03.2019, issued under section 148 of the Act. The petitioner filed Rol in response to the same under protest and requested for reasons for reopening the assessment for the Assessment Year 2012-13. On 15.07.2019, the petitioner filed objections against the reasons recorded, which were disallowed on 11.09.2019. It is further contended that there were no allegations against the petitioner for not disclosing the material on record at the time of scrutiny assessment, and therefore, in the absence of any fault on the part of the petitioner, reopening of a scrutinized issue, is contrary to law and therefore, the petitioner has prayed for quashing and setting aside the impugned notice. It is further contended that there is no tangible material found by the department. Further, it is only a change of opinion on the part of the Assessing Officer. Moreover, in the absence of reasoned sanctioned under the Act, the proceedings initiated are required to be quashed. It is further contended that the petitioner has no alternative remedy and therefore, has filed this petition praying for to quash and set aside the impugned notice dated 27.03.2019, issued under section 148 of the Act.

3. Per contra, the respondent has filed affidavit-in-reply interalia contending that the petition is filed at a pre-mature stage inasmuch as, it is the notice under section 148 r/w. section 147 of the Act only. It is further contended that the petitioner, in the proprietorship concern of Subhalaxmi Trading Company, carried out huge transactions of purchases and sales. It had come on record that the petitioner accepted that she had made purchases and sales without taking delivery of good. Further, Shri Nikhil Gupta - power of attorney holder of the petitioner, in his statement, has categorically admitted that his mother is a housewife and that, she had not carried out any business activities at any point of time in her life. It is further contended that mere accommodation entries were provided without there being any physical transportation of goods. Further, such statement has also been recorded under section 131 of the Act. The inquiry conducted further revealed that for providing such accommodation entries, entry providers normally earn commission ranging from 0.5% to 1%. Therefore, despite the petitioner earning such commission for providing accommodation entries, had not shown such commission in the return and therefore, based on such tangible material and after due application of mind, assessment has been reopened. Further, the petitioner filed objections and the same h