Sufficiency of Reasons and Findings in Order u/s 148A(d) of Income Tax Act cannot be Scrutinized by Writ Court on Assessing Officer Acting Judiciously: Calcutta HC [Read Order]

A Single Bench of the Calcutta High Court observed that the sufficiency of reasons and findings in order under Section 148A(d) of the Income Tax Act, 1961 cannot be scrutinized by a writ court.

By the writ petition, the petitioner, Arissan Energy Limited, has challenged the impugned order under Section 148A(d) of the Income Tax Act, 1961 relating to assessment year 2019-20. The petitioner submitted that in the impugned order petitioner’s objection has not been properly considered and there could not be any material against the petitioner to proceed with the impugned proceeding.

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.

The Court of Justice Md Nizamuddin observed that “I find that the same has neither been passed in violation of principles of natural justice nor is contrary to any provision of law nor the same is without jurisdiction. Sufficiency of the reasons and findings in the order under Section 148A(d) of the Income Tax Act cannot be re-appreciated and scrutinised by this Court in exercise of Constitutional Writ Jurisdiction under Article 226 of the Constitution of India.”

“Matter would have been different had the assessing officer not given any reason at all or had not referred the objection of the petitioner. Just by mere coming to a different conclusion on the basis of the objection or the material furnished by the petitioner cannot be a ground of invoking Constitutional Writ Jurisdiction under Article 226 of the Constitution of India” the Court opined.

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