Stewart Science College,Cuttack Vs ITO Ward 1(1), Cuttack (Orissa High Court)

Date 27th September,2022

Sub- Whether an assessee claiming exemption from filing of return of income u/s 10/11 can be issued notice u/s 148?

The matter related to issue of notice u/s 148 for AY2015-16 in view of cash deposit in bank etc and admitted non filing of return for the said AY. The assessee being a college, contended that as there was no liability to file return of income and hence the notice was bad in law. The department on the other hand argued on plea of alternative remedy. The court after extensively dealing with the meaning of information, proceedings and initiation noted that that the assessee itself contradicted its own stand in the return which was filed in pursuance of notice u/s 148 and relying on entire law in this regard including in the case of Chhabil Das Agarwal, Jeans Knitwear etc , observed that the Supreme Court in the case of ITO, Calcutta Vs Selected Dalurband Coal Company Pvt ltd (1997) 10 SCC 68(SC) held that at the stage of issuance of notice, the only question is whether there was relevant material,on which a reasonable person could have formed a reasonable belief and thus the writ petition was dismissed.

The decision has dealt with the law in relation to 148 extensively and this decision will be cited by department while dealing with plea of alternative remedy particularly in the State of Orissa, though the decision of Raza Textiles will come to assessee’s rescue that jurisdiction fact can be subject matter of writ jurisdiction.

Ramesh Patodia
02-10-2022