Order Passed U/S 148A(d) Income Tax Act Is Not Appealable, Writ Jurisdiction Can Be Invoked: Madhya Pradesh High Court
The Madhya Pradesh High Court has held that an order passed under Section 148A(d) of the Income Tax Act 1961 is not an appealable order, therefore, the only remedy with an aggrieved party is to invoke writ jurisdiction of the High Court.
Proceedings under Section 148A are initiated when Income Tax officers suspect that a taxpayer may have concealed income during any assessment year.
Section 148(1)(b) contemplates issue of show cause to provide an opportunity of hearing to the assessee. Sub-section (1)(d) empowers the Assessing Officer to decide whether reassessment notice under section 148 should be issued to the assessee.
Hence, an order passed under Section 148(1)(d) is not final determination of escapement of income.
In this scheme, a division bench of Justices Vivek Rusia and Binod Kumar Dwivedi observed,
“Admittedly, the order passed under Section 148A(d) of the Income Tax Act is not an appealable order, therefore, except writ petition the petitioner has no other alternative efficacious remedy.”
The petitioner was aggrieved by order passed against him under Section 148A(d) and consequential show-cause notice under Section 148.
As per factual matrix of the case, Petitioner was served with a show cause notice under Section 148A(b) on 24.03.2024. He appeared before the AO on 31.03.2024 and sought adjournment to file a detailed reply.
The High Court noted that the AO “wrongly observed” that the petitioner had filed a reply on 31.03.2024.
The petitioner had in fact filed a reply on 05.04.2024 and on the very same date, the competent authority passed the order under Section 148A(d) and re-assessment notice under Section 148.
Court observed that the Petitioner was not given an effective opportunity of hearing to defend himself.
“Once the statute provides an opportunity of hearing before initiation of proceedings under Section 148 of the Act, then effective opportunity of hearing should be provided to the assessee. It is not the case where the time to pass final order was going to expire and the order was liable to be passed on 05.04.2024. As per Section 148A(b) of the Income Tax Act, minimum 7 days time and maximum 30 days time is liable to be given as an opportunity of hearing to the noticee. In the present case, the impugned order has been passed before expiry of 30 days from the date of issuance of show cause notice, therefore, the order is unsustainable the eyes of law,” it held.
Accordingly, the Court remitted the matter back to the AO to decide the show cause notice issued under Section 148A(b) afresh, after giving opportunity of hearing to the petitioner.
Appearance: Advocate Gagan Tiwari for petitioner; Advocate Harsh Parashar for respondents
Case title: Rakesh Agrawal v. Central Board Of Direct Taxes And Others
Case no.: WRIT PETITION No. 16139 of 2024