High Court Of Punjab & Haryana
Syal Leasing Ltd. vs. Assistant Commissioner Of Income Tax & Anr.
Sections 147, 148, Art. 226
Asst. Year 1997-98
N.K. Sodhi & V.M. Jain, JJ.
Civil Writ Petn. Nos. 14765 & 14775 of 2003
18th September, 2003
P.C. Jain with Pankaj Jain, for the Petitioner : None, for the Respondents
N.K. SODHI, J. :
This order will dispose of two civil writ petitions 14765 and 14775 of 2003 in which common questions of fact arise. For the sake of convenience the facts are being taken from CWP 14765 of 2003.
The relevant assessment year is 1997-98. By order dt. 27th Feb., 1998, the assessment for the relevant year was completed and the rebate on depreciation was allowed. However, for the subsequent asst. yr. 1998-99 the AO came to the conclusion that the depreciation claimed by the assessee on the alleged leased vehicles was not available as the arrangement of lease was nothing but financing of the vehicles and, therefore, the assessee was not entitled to depreciation. The AO, therefore, had reason to believe that the income in the hands of the assessee had escaped assessment for the relevant assessment year. Consequently, a notice under s. 148 of the IT Act (for short the Act) was issued calling upon the petitioner to show-cause why income for the relevant assessment year be not reopened and the depreciation amounting to Rs. 48,13,495 be not withdrawn. The petitioner raised several objections objecting to the reopening of the assessment. Those objections have been considered and decided by the AO by a detailed speaking order dt. 25th Aug., 2003. It is against these orders that the present petition has been filed under Art. 226 of the Constitution.
We have heard the learned counsel for the petitioner and perused the record. It is not in dispute that for the subsequent asst. yr. 1998-99 the AO has already determined that the relevant agreements executed by the petitioner were with a view to finance the vehicles and that those were not leasing agreements. That finding of the AO was affirmed by the CIT(A). Feeling aggrieved by the orders of the CIT(A), the petitioner has preferred an appeal before the Tribunal which is pending. The question now arises is whether the AO had reason to believe that the income of the assessee for the relevant asst. yr. 1997-98 had escaped assessment. In view of the findings recorded by the AO in the case of the assessee for the asst. yr. 1998-99, we are clearly of the view that the AO had sufficient reason to believe to issue a notice under s. 148 of the Act. In any case, it will be open to the petitioner to raise all the pleas before the assessing authority and in case it feels aggrieved, it will have a right of appeal. We are not inclined to interfere with the notice under s. 148 of the Act at this stage and allow the petitioner to bypass the statutory remedies under the Act.
Consequently, the writ petitions are dismissed.
[Citation : 266 ITR 63]