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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SONIA GOKANI, MAUNA M. BHATT, JJ.
Keenara Industries Private Limited – Appellant
Versus
The Income Tax Officer, Ward 1(1)(3), Surat – Respondent
R/SPECIAL CIVIL APPLICATION NO. 17321 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21192 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21194 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17140 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17230 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20113 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17331 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25913 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17444 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21316 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17487 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17491 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17492 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17501 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17503 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17603 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17641 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17653 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17707 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17750 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17817 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17953 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17984 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17965 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 17968 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18253 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18523 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18549 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18552 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18578 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18591 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18713 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18785 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18884 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 18949 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19088 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19117 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19145 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19180 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19239 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19240 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19242 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19257 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19258 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19260 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19290 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19311 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19313 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19408 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19411 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19418 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19419 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19455 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19471 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19514 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19534 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19538 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19566 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19568 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19569 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19719 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19721 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19736 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19750 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19867 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19871 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19895 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19948 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19960 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19990 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20105 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 19992 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20032 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20050 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20068 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20082 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20112 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20121 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20265 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20305 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20326 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20352 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20353 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20355 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20362 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20364 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20430 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20490 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20521 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20533 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20613 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20752 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20761 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20770 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20775 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20786 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20919 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20984 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 20985 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21018 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21061 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21097 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21118 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21151 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21239 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21286 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21374 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21376 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21383 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21527 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21624 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21708 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 21751 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22060 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22141 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22180 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22206 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22244 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22278 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22312 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22341 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22343 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22346 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22347 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22383 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22384 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22393 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22396 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22398 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22399 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22410 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22415 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22416 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22446 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22596 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22708 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22710 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22712 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22714 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22716 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22717 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22718 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22720 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22721 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22722 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22725 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22728 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22769 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22773 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22838 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22842 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22864 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22865 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22868 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22871 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22876 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22877 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22880 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22882 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22895 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22949 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22960 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22963 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22971 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22973 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 22974 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23000 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23018 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23105 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23133 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23134 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23136 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23139 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23140 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23142 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23143 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23188 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23189 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23190 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23205 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23206 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23208 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23209 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23211 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23216 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23220 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23223 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23224 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23226 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23227 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23228 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23229 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23232 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23233 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23234 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23245 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23247 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23253 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23269 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23270 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23271 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23777 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23845 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23852 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23854 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23855 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23931 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 23934 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24238 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24333 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24335 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24503 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24505 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24508 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24510 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24556 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24557 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24558 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24562 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24693 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24695 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24704 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24722 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24777 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24938 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 24941 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25319 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25321 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25330 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25339 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25348 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25352 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25367 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25502 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25506 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25510 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25521 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25523 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25524 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25528 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25535 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25536 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25605 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25617 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25914 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25916 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25922 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25925 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25928 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25955 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25957 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 25959 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 26024 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 26215 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 26256 of 2022 With R/SPECIAL CIVIL APPLICATION NO. 26348 of 2022 With R/SPECIAL CRIMINAL APPLICATION NO. 5059 of 2021
Decided on : 07/02/2023
Constitution of India,1950 - Article 226 - Income Tax Act, 1961 - Section 148 - Finance Act 2021 - Income Tax Notice – Assessment year - Seeking to reopen income tax assessment - Challenged - Held, In view of express language of 1st proviso to Section 149(1), legislative mandate required that no notice could be issued under new provision, if such notice could not be issued at that time on account of being beyond time specified under said section as it stood before commencement of Finance Act 2021, i.e a period of six years - In all petitions of batch I and batch II, notices under Section 148A (by deeming fiction) was issued, between period , wherein six years had elapsed from end of relevant assessment year and they are time barred and petitions of Batch deserves to be allowed- It is made clear that other grounds raised in petition are not gone into since subject petitions are decided only on ground of limitation – Petition allowed
JUDGMENT :
SONIA GOKANI, J.
1. Group of petitions since involve identical questions of facts and law, they are being decided by this common judgment. The facts are drawn for the purpose of adjudication from Special Civil Application No.17321 of 2022.
2. The petitioner by way of the present petition under Article 226 of the Constitution of India challenges notice dated 26.07.2022 issued under Section 148 of the Income Tax Act, 1961 (referred to as ‘the Act’) as well as the order dated 26.07.2022 passed under Section 148A(d) of the Act seeking to reopen the income tax assessment of the petitioner for assessment year 2014-15 terming the said notice and order as bad, illegal and contrary to law and without jurisdiction.
2.1 The petitioner is a company incorporated under the Companies Act, 1956 of which majority shareholders are citizens of India. The department had issued the notice of reopening under Section 148 of the Act for the year under consideration during the period between 01.04.2021 to 30.06.2021 after following the erstwhile procedure prescribed for reopening (the law applicable till 31.03.2021) despite the fact that w.e.f 01.04.2021, new regime of reopening provisions had come into force. This was challenged and the matter eventually from various High Courts had travelled to the Apex Court, which vide its judgment dated 04.05.2022 in case of Union of India vs. Ashish Agarwal, reported in (2022) 444 ITR 1 (SC) adjudicated the issue as to the validity of such reopening notices issued across the Nation and gave certain directions to the department.
2.2 Consequent to the aforesaid decision, the reassessment proceedings for the year under consideration have been initiated and the respondent issued a show cause notice dated 28.05.2022 under clause (b) of section 148A of the Act, whereby the petitioner was supplied the relevant material, on the basis of which the case for the year under consideration is sought to be reopened. The petitioner was called upon to show cause as to why, in view of such material, notice under section 148 of the Act should not be issued for the year under consideration.
2.3 The information has been received from the Investigation Wing, Kolkata, to the effect that during the course of search action carried out in the case of Maji Group (i.e. third party) on 05.11.2020, it was found that Anup Majee alias Lala has acquired certain paper companies including Starlight Devcon Pvt. Ltd.
2.4 On analysis of Bank statements of these companies, it was found that the petitioner has received unsecured loans from these companies. As per the finding of the search actions, Starlight is a shell company and has no financial capability to provide such loans and therefore, credits in the books of accounts of the petitioner are to be treated as unexplained cash credit under section 68 of the Act.
2.5 The petitioner was called upon to show cause as to why a notice under section 148 of the Act should not be issued on the basis of such information, which suggests income to the tune of Rs.1,25,00,000/- chargeable to tax has escaped the assessment for the year under consideration.
2.6 The petitioner furnished a detailed reply to the said show cause notice vide letter dated 09.06.2022 and in view of such submissions contained therein, the request was made to the respondent to drop the reassessment proceedings.
2.7 The petitioner raised the following contentions:
(i) The petitioner was supplied a copy of insight portal uploaded on 20.03.2021 wherein it was stated that the petitioner has received unexplained cash credit of Rs.1,25,00,000/- from Starlight Devcon Pvt. Ltd. during the year under consideration.
(ii) A copy of the so called report supplied along with the show cause notice did not contain any stamp or sign of any official.
The petitioner requested to provide the copy of statements recorded of Mr.Anup Majee, wherein he stated t
The court emphasized that reassessment notices must adhere to the amended provisions of the Income Tax Act, and notices issued beyond the stipulated limitation period are invalid.
The issuance of a notice under Section 148 of the Income Tax Act is barred by limitation if it exceeds the time limits specified in Section 149, as reaffirmed by the court.
Reassessment notices u/s 148 issued beyond surviving TOLA time limits post-Ashish Agarwal exclusions are invalid and quashed.
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