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July 14, 2023

Section 148A(b): Disclosure of the information on which the AO based its opinion

Section 148A(b): Disclosure of the information on which the AO based its opinion

Fact and issue of the case

In the writ petition order passed by the Assessing Officer under Section 148A(d) of the Income Tax Act, 1961 (hereinafter referred to as the “said Act”) as well as the proceeding which has been initiated under Section 148A is under challenge.

During course of hearing, the learned advocate representing the petitioner has drawn attention of this Court to the notice dated 30th March, 2023 issued under Section 148A(b) of the said Act of 1961.

The grievance of the petitioner which has been ventilated in the writ petition is by issuing order dated 19th April, 2023 under Section 148A(d) of the said Act of 1961 the Revenue Authorities have entered into an arena of Section 148 whereby past assessment has been reopened on the allegation that certain income of the petitioner being assessee was found to be chargeable was not disclosed at the material point of time as a result whereof the said income of the assessee had escaped the assessment. While attacking the order passed under Section 148A(d) reliance has been placed on the safeguards provided by the statute under Section 148A(a), (b) & (c).

In addition thereto petitioner has also relied upon a department circular dated 1st August, 2022 wherein it has been provided that before issuing an order under Section 148A(d) an enquiry is required to be carried out.

Mr. Mazumdar, learned Deputy Solicitor General has defended the steps taken by the Revenue Authority and also has relied upon the order passed by the concerned Revenue Authority under Section 148A(d) and it has been demonstrated before this Court that elaborate exercise has been made by the concerned Assessing Officer before issuance of the said impugned order dated 19th April, 2023. According to the Revenue Authority the procedure which is required to be followed under Section 148A(b) and under Section 148A(c) has been complied with.

On perusal of reply of the petitioner dated 17th April, 2023 to the show cause notice, it appears that petitioner has specifically requested the Assessing Officer to supply the copies of statements of Sri. Kailash Kumar Patwari based on which the concerned Assessing Officer decided to initiate proceeding under Section 148A and final order has been passed under Section 148A(d).

Today there is nothing on record which goes to show that the information which has been provided by said Kailash Kumar Patwari to the concerned Revenue Authority has been disclosed to the petitioner by the Assessing Officer and it has also been submitted on behalf of the Revenue Authority that there are certain materials based on which there has been formation of opinion by the concerned Revenue Authority that a portion of the income of the petitioner remained unassessed. It appears to this Court that materials based on which opinion was formed by the Assessing Officer needs to be disclosed to the petitioner in contemplation of the provisions as provided under Section 148A(a), (b) and (c),

Observation of the court

In view of aforesaid scenario this Court though permits the Revenue Authority to conclude the proceeding under Section 148 but not to pass final order without the express leave of this Court.

Let affidavit-in-opposition to this writ petition be filed within three weeks from date, affidavit-in-reply if any thereto, be filed within one week thereafter.

Parties shall be at liberty to mention the matter before the next available Circuit for hearing after the time fixed hereinabove for exchanging the affidavits.

The parties shall act on the basis of the server copy of the order downloaded from the Official Website of this Court.


In the result, appeal of the assessee is allowed and ruled in favour of the assessee

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