The main legal point established in the judgment is that the reasons recorded for reopening an assessment must have a factual foundation and support the belief that income has escaped assessment, failing which the notice and order disposing of objections are unsustainable.

ORDER :

ARAVIND KUMAR, J.

1. Though the matter is listed for admission, by consent of learned advocates appearing for the parties, it is taken up for final disposal.

2. We have heard the arguments of Shri B. S. Soparkar, learned counsel appearing for the petitioner and Shri Varun K. Patel, learned counsel appearing for the respondent - assessee.

3. The short issue which arises for consideration in this petition is whether the notice dated 30.03.2021 (Annexure-A) issued under Section 148 deserves to be quashed or set aside for any reason whatsoever?

4. BRIEF - BACKGROUND OF THE CASE:

Petitioner is a limited company, engaged in the business of manufacturing exports and trading of Dyes Intermediates. For the assessment year of 2013 - 2014 filed its return of income on 17.09.2013 and revised return of income was filed on 21.09.2013, which was processed under Section 143(1) of the Income Tax Act, 1961 (hereinafter referred as to the "Act") and on returns being selected for scrutiny, notice under Section 143(2) of the Act was issued to petitioner and assessment order came to be passed under 143(3) of the Act on 21.03.2016. It is thereafter i.e. on 30.03.2021 impugned notice came to be issued for reopening the assessment on the ground that Assessing Officer had reason to believe that income chargeable to tax had escaped to tax. On being called upon by the assessee to furnish the reasons which had been recorded for reopening of such assessment order, same was furnished to petitioner on 17.05.2021 which was objected to by the petitioner by filing objections on 27.05.2021 (Annexure-F). Thereafter, Assessing Officer considered the said objection and rejected the same or disposed of the objections by not accepting it on 11.11.2021(Annexure-G). Hence, this petition.

5. The prime argument of Shri S. N. Soparkar, learned counsel appearing for petitioner is that in the noticed issue for reopening it is alleged that 40 lakhs loan was obtained by the petitioner from M/s Dishman Carbogen Amics Ltd. (Dishman Pharmaceuticals and Chemicals Ltd. earlier) which was a fictitious loan and he would contend that as a matter of fact petitioner had not obtained any loan from the said company and therefore, giving equal amount of cash to said company of M/s Dishman did not arise. He would elaborate his submission by contending that without even examining this plea raised in its objections filed for reopening of the assessment, same had been disposed of in perfunctory manner and there has been total non- application of mind. He would submit that even otherwise the assessee being a company had filed Nil return and had paid tax on book profit computed under MAT provision and even if the said component of Rs.40 lakhs is proposed to the addition, it would not change the tax implication, as the assessee would still continue to be governed under the provisions of MAT, namely, Section 115JB and as such there would be no excess tax liability even under MAT provision and as such there is no escapement of tax and therefore reassessment does not arise. He would also contend that no sanction has been obtained as required under Section 151 of the Act, prior to issuance of notice under Section 148 and in the absence of any satisfaction being recorded by the higher authority, impugned notice could not have been issued. Hence, he would contend that impugned notice (Annexure-A) and consequential order disposing of the objections filed to the said notice by overrulling the same on 11.11.2021 (Annexure-G) are liable to be quashed.

6. Per contra, Shri Varun K. Patel, learned standing counsel appearing for the assessee would support the impugned notice and the consequential order dated 11.11.2021 passed orverruling the objections of the petitioner.

7. Having heard the learned advocates appearing for the parties and on perusal of the records, it would emerge from the record and proceedings of this Court that at the time of issuing the notice on this Special Civil Application and after hea