Point of Law: Court cannot strike down reopening of case on these grounds and it will be open to assessee to prove that assumptions of facts made in notice were erroneous.

ORDER :

MEHTA, J.

1. The petitioner has filed the instant writ petition under Article 226 of the Constitution of India for questioning the legality and validity of the re-assessment notice dated 31.03.2021 (Annex.5) under Section 148 of the Income Tax Act, 1961 and the order dated 13.09.2021 (Annex.12) disposing of the objections submitted by the petitioner against the re-opening of the assessment for the Assessment Year 2017-18.

2. Brief facts relevant and essential for the disposal of the writ petition are noted hereinbelow:-

3. The petitioner firm came into existence in the financial year 2016-2017 (Assessment year 2017-2018) and since then it is engaged in the business of textile job work at Pali. The petitioner filed its original return of income in terms of Section 139 (1) of the Income Tax Act, 1961 for the assessment year 2017-2018 on 30.09.2017 and the same was verified by the respondent Department without any defect. After filing of the return of income for the Assessment Year 2017-18, a notice/summon dated 24.08.2017 under Section 131 (1A) of the Income Tax Act was issued to the petitioner for making an enquiry in relation to the source of large investment to the tune of Rs.1,21,40,000/-made by the petitioner firm in acquiring immovable property situated at plot No.A-4, Nextgen Textile Park, Sardarsamand Road, Pali. The petitioner filed detailed explanation in prescribed format alongwith documentary evidence in response to the said notice/summon. No further proceedings were forthcoming after the explanation submitted by the petitioner as above. However, a notice dated 31.03.2021 (Annex.5) was served upon the petitioner under Section 148 of the Income Tax Act proposing to reopen proceedings for the assessment year 2017-2018 stating therein that the Assessing Officer (A.O.) had reasons to believe that income chargeable to tax had escaped assessment for the Assessment Year 2017-18 within the meaning of Section 147 of the Income Tax Act. The petitioner filed a fresh return of income in response to the notice issued under Section 148 of the Income Tax Act declaring identical particulars of income as per the original return filed under Section 139(1) of the Act. Thereafter, the petitioner requested the respondent I.T.O., Pali to supply copy of the reasons recorded prior to initiation of proceedings under Section 148 of the Act alongwith copy of approval/sanction from the competent authority in terms of the Section 151 of the Income Tax Act. In response thereto, the petitioner received a communication dated 28.06.2021 (Annex.8) issued under Section 143 (2) of the Act incorporating therein the reasons to believe and so also the approval for initiating the re-assessment proceedings. The reasons for reopening the assessment as highlighted in the Annex.8 are reproduced hereinbelow for the sake of ready reference:-

"The assessee M/s Rajhans Processors has invested in immovable property situated C-152, Nirman Vihar, Delhi for an amount of Rs. 1,21,40,000/-. Thus, the assessee has made huge investment to the tune of Rs.1,21,40,000/- for purchase of above property during the F.Y. 2016-17. On verification through system & record, it is noticed that, the assessee has not disclosed this investment in its return of income as well as the source of investment made for purchase of above undisclosed income. As such the amount of Rs.1,21,40,000/-is actually the undisclosed income of the assessee and the same has escaped assessment. The same is liable to be brought to tax by initiation of proceedings u/s 147/148 of the I.T. Act.

I have gone through the information as well as the facts of the case, I have reason to believe that the income of Rs.1,21,40,000/-is chargeable to tax has escaped income for A.Y. 2017-18 and accordingly I am satisfied that taxable income to the tune of Rs. 1,21,40,000/-which has escaped income, and it is a fit case for initiation of proceedings u/s 147 of the I.T. Act, 1961."

4. The petitioner filed preliminary objections