The grounds raised by learned counsel for petitioner in support of
challenge to the impugned order and notice are as follows:
(a) The income referred to in impugned order and notice
Annexure P-3 and P-4 is not income chargeable to tax
but is the gross proceeds/consideration received by
petitioner for sale of 16 scooters during the assessment
year 2016-2017 and thus the Revenue has no authority to
invoke Section 148A or issue notice under Section 148.

6.1 Admittedly, the expression ‘income chargeable to tax’ is not
defined in the IT Act. However, the scheme of the IT Act specially the provisions which deal with computation of business income make it abundantly clear that definition of expression ‘income’ and ‘income chargeable to tax’ are at variance to each other. The expression ‘income’ is inclusively defined under Section 2(24) of IT Act whereas ‘income chargeable to tax’ obviously denotes an amount which is less than ‘income’. The ‘income chargeable to tax’ is arrived at after deducting the permissible deductions under IT Act from ‘income’. As
such quantum of ‘income’ is invariably more than the income
chargeable to tax.
6.2 More so, all penal provisions under the scheme of income tax,
emanate from the factum of evasion of tax calculated based on income chargeable to tax
6.3 Several High Courts have held that income chargeable to tax
cannot be the gross receipts/consideration in any business transaction.
One such decision which appears to be closest to the facts of present case is the Single Bench decision of Karnataka High Court rendered on 24.5.2023 in W.P.No.7647/2023 (T-IT) (Mr. Sanath Kumar Murali Vs. The Income Tax Officer & Ors.),
6.4. The objection of learned counsel for Revenue that the petitioner having failed to file return for the relevant assessment year cannot seek to challenge the impugned order, is heard to be dismissed. The provisions from Section 147 to Section 151 pertaining to subject of income escaping assessment in the IT Act do not support the contention of the Revenue. There is nothing in Section 148, 148 A or Section 149 which may prevent assessee from taking advantage of said provisions merely because of his failure to file return.
6.5. More over, neither the notice under Section 148A(b) nor order under Section 148 A(d), nor the consequential notice under section 148A give any indication that amount of Rs.7205084 alleged to be income escaping assessment, includes land/buildings/shares/equities/ loans/ advances etc. as contended by the Revenue.
6.6 In fact when petitioner/assessee filed a reply to the notice under Section 148(A)(b) of the IT Act vide Annexure P-2, it was clearly revealed that the said amount of Rs.7205084/- is the gross receipt of sale consideration of 16 scooters. Meaning thereby that the said amount of Rs.7205084/- was the total sale consideration receipt of the transaction in question, and not income chargeable to tax which would obviously be less than the said amount
6.8 It appears that while considering the said reply and before
passing the impugned order under Section 148A(b) of the IT Act,
highly casual and perfunctory approach was adopted, turning a
Nelson’s eye towards the palpable and elementary aspect of clear
distinction between consideration of sale and income chargeable to tax.
7. In a recent decision rendered by this Bench where a view in
favour of Revenue was taken, it was observed that provisions under Section 148A was inserted in the IT Act w.e.f. 1.4.2021 to render the power of Revenue of reopening cases to be more transparent so as to avoid casual invocation of Section 147-148. It was held that insertion of Section 148A not only saves the assessee from casual commencement of proceedings under Section 147-148 but will also save the Revenue of precious time and energy which may be wasted in persuing fruitless, frivolous and vexatious cases. The decision rendered on 9.8.2023 in W.P.No.15244/2023 (M/s Amrit Homes Private Limited Vs. Deputy Commissioner of Income Tax & Anr.) passed by this Bench.

8. It may not be out of place to mention that had the Revenue
arrived at the correct figure of income chargeable to tax instead of the gross receipts/consideration, the possibility of the amount of Rs.7205084/- coming down to a figure below Rs.50 lacs cannot be ruled out.
9. From the aforesaid discussion what comes out loud and clear is
that the Revenue has failed to understand the fundamental difference between sale consideration on one hand and income chargeable to tax on the other. The Revenue despite being assisted by thousands of experts in the field of finance and taxation, has committed such elementary mistake leading to harassment to the assessee who has been compelled to file the present avoidable piece of litigation. More so, this Court has been compelled to decide this frivolous matter wasting its
precious time and energy which could have been utilised in more
pressing matters.
9.1 Thus, the Revenue deserves to be saddled with exemplary cost
and correspondingly the petitioner is entitled to compensatory cost.
Revenue is saddled with cost of Rs.25,000/- (Rupees Twenty Five Thousand Only), out of which Rs.15,000/- (Rupees Fifteen Thousand Only) shall be credited in favour of the M.P. High Court Employees’ Association, Jabalpur (S.B.A/c No.519302010000235, Union Bank of India, State Bar Council Branch, Jabalpur) and the
remaining Rs.10,000/- (Rupees Ten Thousand Only) shall be paid to the petitioner through digital transfer in his bank account within a period of 30 days failing which the case shall be listed before the Bench under Caption ‘Direction’ as PUD qua cost.