Income Tax Act, 1961 – ss.260-A, 148 – Assessing officer (AO) issued notice to the respondent u/s.148 – Objections raised by the respondent were accepted by the ITAT – Aggrieved, Revenue filed appeal in the High Court – High Court dismissed the appeal in limine on the ground that it did not involve any substantial question of law within the meaning of s.260A of the Act – On appeal, held: The order of the High Court legally not sustainable – The following four questions need to be answered by the High Court on their respective merits while deciding the appeal filed by the Revenue u/s.260-A of the Act – (i)Whether the ITAT was justified in holding that the notice issued by the AO u/s.148 was bad in law when admittedly the impugned notice was issued in the case where the assessment was made u/s.143(1) of the Act but not u/s.143(3) of the Act – (ii)Whether the ITAT was justified in holding that the notice issued u/s.148 of the Act was bad because it was based on mere change of opinion by overlooking the fact that there was no foundation to form any such opinion – (iii) When admittedly the notice in question satisfied the requirements of s.148 of the Act as it stood, namely, that first, it contained the facts constituting the “reasons to believe” and second, it furnished the necessary details for assessing the escaped income of the assessee, whether the ITAT was still justified in declaring the notice as being bad in law without taking into consideration any of these admitted facts – (iv) In case, if the notice is held proper and legal, whether the finding recorded by the ITAT on the merits of the case on each item, which is subject matter of the notice, is legally sustainable – Thus, case remanded to the High Court for answering the aforementioned questions on merits in accordance with law.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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