Order u/s 148A(d) of Income Tax Act is not final Assessment Order, no Income Tax Demand arises: Calcutta HC [Read Order]

The Calcutta High Court in a recent decision observed that the order under Section 148A(d) of the Income Tax Act, 1961 is not final assessment order and hence no income tax demand arises.

By the writ petition, the petitioner, Rachna Singhi, has challenged the impugned order under Section 14A(d) of the Income Tax Act, 1961 relating to assessment year 2019-20. The petitioner is not satisfied with the reasoning given by the respondent/Income Tax Officer in the impugned order.

Section 148A of the Income Tax Act, 1961 is a provision that allows the Assessing Officer (AO) to issue a notice to a person who has failed to furnish a return of income, report or statement of financial transaction. This section was introduced by the Finance Act, 2021, and is applicable from 1st April 2021.

After considering reply/objections of the taxpayer and after further inquiry he is required to pass an order under Section 148A(d) of the Income Tax Act holding a case for reassessment of certain definite sum escaping assessment.

A Single Bench of the High Court comprising Justice Md. Nizamuddin observed that “Sufficiency of the reason or reasonableness of the reason in an impugned order under Section 148A(d) of the Income Tax Act cannot be gone into by the writ court when petitioner was already given an opportunity to file objection by the petitioner and the same was considered by the Assessing Officer though he may have come to a different finding and conclusion.”

The Court further held that the petitioner still has ample scope in the proceedings subsequent to the notice under Section 148 of the Income Tax Act after passing the order under Section 148A(d) of the Income Tax Act to make out a case if she has in her favour. The order under Section 148A(d) of the Income Tax Act is neither final assessment order nor any demand arises out of the same.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates