IMPORTANT POINT
Reassessment under Section 148 requires new tangible material; reliance on prior information constitutes a change of opinion, which is impermissible.

ORDER :

NIRAL R. MEHTA, J.

1. By way of this petition under Article 226 of the Constitution of India, the petitioner seeks to challenge the notice dated 29th March 2021 issued by the respondent under Section 148 of the Income Tax Act, 1961 (for short, “the Act”) as well as the order dated 9th February 2022, by which the objections raised by the petitioner were rejected.

2. The facts giving rise to the present petition, in nutshell, can be stated as under:

2.1. The petitioner is engaged in the business of trading in gold ornaments. On 16th April 2022, two employees of the petitioner carrying around 19 Kgs. of gold ornaments were intercepted by the Assistant Director of Income Tax (Investigation) at the Mangalore Airport. An inquiry was carried out as to the nature and source of investment in gold jewellery held by them by issuing summons under Section 131(1A) of the Act upon the petitioner as well as the employees namely Mr. Chidrap Gandhi and Mr. Paresh Rawal.

2.2. On 17th April 2012, notice was also issued by the Income Tax Officer (Investigation), Air Intelligence Unit, Ahmedabad specifically inquiring into the purchase of the gold and its accounting by the petitioner.

2.3. Apropos to the aforesaid, the petitioner submitted details vide letter dated 3rd May 2012. Thereafter, the employees along with gold held by them were released from Mangalore.

2.4. The petitioner filed his return of income for the Assessment Year 2013-14 on 20th September 2013 declaring, inter alia, total income of Rs.22,12,882/-. The return was selected for scrutiny. During the course of scrutiny, notices under Section 142(1) of the Act dated 14th August 2015, 11th January 2016 and 5th February 2016 were issued upon the petitioner inquiring, inter alia, the entire business activity of the petitioner including the travelling expenditure. The petitioner submitted all the relevant material regarding quantity of gold ornaments, details of closing stock along with relevant documents, details of opening stock purchase, consumption, yield and sale both with respect to raw material as well as with respect to finished goods on 2nd January 2016. The Assessing Officer, having considered the documents submitted by the petitioner, passed the assessment order under Section 143(3) of the Act on 4th March 2016 without making any addition on account of purchase of gold ornaments.

2.5. Despite the aforesaid, notice dated 29th March 2021 under Section 148 came to be issued by the Income Tax Department upon the petitioner to file return of income for the Assessment Year 2013-14. On 4th May 2021, the petitioner complied to the notice under Section 148 of the Act by filing his return of income and sought reasons recorded for reopening. The extract of reasons was provided on 27th August 2021. The petitioner, therefore, vide letter dated 2nd October 2021, requested full copy of the reasons recorded containing date of recording and full copy of satisfaction recorded by the Principal Commissioner of Income Tax, Ahmedabad-1.

2.6. On 17th December 2021, respondent has issued notice under Section 142(1) of the Act instead of providing the full copy of reasons recorded by the PCIT, Ahmedabad – 1. Furtherance thereof, objections were filed by the petitioner on 28th December 2021 and once again to supply full copy of reasons recorded and approval obtained.

2.7. To the aforesaid, respondent No.2 provided the undated copy of reasons recorded on 29th December 2021 and has not provided the copy of satisfaction recorded by the PCIT, Ahmedabad-1 and thereafter, on 9th February 2022, objections filed by the petitioner came to be disposed of.

3. Being aggrieved and dissatisfied by the aforesaid, the petitioner has approached this Court by way of present petition for the appropriate relief.

4. We have heard learned advocate Mr. B. S. Soparkar for the petitioner and learned advocate Mr. Varun K. Patel for the Revenue authorities.

5. Learned advocate Mr. Soparkar, while assailing the impugned notice and order