High Court Of Madhya Pradesh : Indore Bench
Dr. Lata Chouhan vs. ITO & Ors.
Section 147, 148
Asst. Year 1997-98
A.M. Sapre & S.K. Seth. JJ.
Writ Petn. Nos. 251 & 9532 of 2003
13th October, 2009
Counsel Appeared :
S.C. Bagadiya with D.K. Chabra, for the Petitioner : R.L. Jain with Ms. Veena Mandlik, for the Respondents
JUDGMENT
A.M. SAPRE, J. :
The decision rendered in this writ shall also govern disposal of connected writ petition being Writ Petn. No. 9532 of 2003 because both these writ petitions involve common questions of facts and law and secondly, both are filed by the same petitioner except the difference between the 2 writs is that of assessment years.
2. By filing this writ under Art. 226/227 of Constitution of India, the petitioner (assessee) seeks to challenge the notice dt. 14th March, 2002 (Annex. P-1) issued by ITO (respondent) under s. 147 of IT Act in respect of asst. yr. 1997-98. The petitioner also seeks to challenge the order dt. 20th Jan., 2003 (Annex. P-2) passed by ITO by which objections raised by petitioner against the issuance of impugned notice have been rejected. Notice of this writ was issued to respondent i.e., IT Department. They have defended the issuance of notice so also overruling of the objections raised by petitioner.
The petitioner is an assessee. She is doctor by profession. She is filing IT return in her capacity as an individual. The petitioner filed her return for the asst. yr. 1997-98 (1st April, 1996 to 31st March, 1997). On 25th Nov.,1999 a survey under s. 133A of the Act was conducted by sleuths of IT Department in the business premises of petitioner. In course of survey, it was noticed that petitioner had made substantial investment in the construction of her hospital building. It was estimated by ITO at Rs. 27,70,000 whereas as per return, the petitioner had disclosed much less i.e., around Rs. 3,65,310. A notice for reassessment was accordingly issued by respondent under s. 147 ibid. The reasons for issuance of notice were contained in Annex. P-1A. It is this notice which is sought to be impugned in this writ by an assessee. Heard Mr. S.C. Bagadiya, learned senior counsel with Mr. D.K. Chabra, learned counsel for the petitioner and Mr. R.L. Jain, learned senior counsel with Ms. Veena Mandlik for the respondent/Revenue.
Learned counsel for the petitioner (assessee) mainly reiterated the same objections which were taken by her before ITO in her 2 letters and which did not find favour to ITO resulting in their rejections by impugned order (Annex. P-2). In substance, submission was that firstly, the notice was issued without application of mind. In the second place, it was contended that when there was no assessment made, there did not arise any occasion for reassessment and lastly, since, notice does not mention the status of assessee and hence, it is bad in law.
In reply, learned counsel for Revenue supported the issuance of impugned notice and its upholding by overruling the objections.
Having heard the learned counsel for the parties and on perusal of record of the case, we are inclined to dismiss the writ.
In our view, there was enough and proper justification both on facts and law for issuance of notice under s. 147/148 of IT Act to petitioner (assessee) in relation to asst. yr. 1997-98.
In the first place, there is a factual basis or we may say occasion for issuance of impugned notice because when survey was conducted as contemplated by s. 133A ibid in the business premises of petitioner, the Department came in possession of material for proceeding to reopen the assessment. This fact was thus, rightly made basis for making reassessment. Secondly, once there exists a basis for forming a prima facie opinion for escaped assessment, then it is sufficient to issue notice under s. 147 ibid. Thirdly, the Courts cannot examine the adequacy or sufficiency of reasons on facts like an appellate Court for deciding as to whether on such facts, notice could be issued or not unless the reasons are found to be totally perverse or absurd or against any provision of law. Such is not the case here.
We are not impressed by the submission of learned counsel for the petitioner when he contended that notice in question was issued without application of mind and was also issued without disclosing the status of an assessee. Both these submissions have no merit whatsoever. As we have held supra that there exists sufficient factual material for issuance of notice impugned herein, the first submission has no force. So far as non-disclosure of petitioner’s status in the impugned notice is concerned, the same too has no merit. The notice clearly mentions the description and name of assessee. It is, in our opinion, a sufficient compliance. It has not caused any prejudice of any nature to petitioner, because she will get enough opportunity to participate in the reassessment proceedings.
Coming now to yet another submission that in the absence of any assessment, no notice could be issued for reassessment, the same has no merit whatsoever. Sec. 147 applies to all kinds of cases which includes assessment as also reassessment. In any case, the AO has jurisdiction to issue notice under s. 147 in all types of cases. In this case, we find that return was filed and hence, notice under s. 147 could be issued on satisfying the requirements of s. 147. In this case, they were complied with as has been held supra and hence, impugned notice could be issued for reassessment.
In our view, a notice under s. 147 can be challenged on very limited grounds in writ petitions. These grounds must relate to only jurisdiction and not on facts. A Writ Court cannot probe the legality of notice on facts. It is not permissible. In this case, we have not been able to notice any jurisdictional error requiring interference of High Court in its writ jurisdiction.
Learned counsel for the petitioner placed reliance on the decisions reported in Jawaharlal Daryavbuxmal vs. CIT (1982) 31 CTR (MP) 282 : (1982) 137 ITR 54 (MP), Smt. Amiya Bala Paul vs. CIT (2003) 182 CTR (SC) 489 : (2003) 262 ITR 407 (SC), Shyam Sundar Bajaj vs. ITO (1973) 89 ITR 317 (Cal) and CIT vs. B. Ranga Reddy (1979) 118 ITR 897 (AP). We have perused these decisions in the context of facts involved therein. We are of the view that on facts of this case, the ratios of these decisions have no application. We thus do not consider it necessary to deal with each decision separately to show its distinguishing features.
In view of foregoing discussion, we are unable to notice any infirmity in issuance of notice (Annex. P-1/P-A) and its upholding by ITO. As a consequence, the petition is found to be devoid of merit. It is accordingly, dismissed. The ITO (AO) is now directed to complete ,the assessment/reassessment proceedings strictly in accordance with law after affording an opportunity to assessee as contemplated in s. 143(2) r/w s. 147/148 within 3 months from the date of production of this order. Parties to appear before AO on 26th Oct., 2009 to enable him to complete the proceedings. No costs C.C. as per rules.
[Citation : 329 ITR 400]
