The High Court of Bombay at Goa, quashed a reassessment notice issued under Section 148-A(b) of the Income Tax Act, 1961. The petitioner, Shri Dilip Laximan Powar, who is paralyzed and represented by his wife, challenged the validity of the notice on the grounds that it was issued after the mandated period and based on an audit objection that amounted to a mere change of opinion rather than new information.

Background of the Case:

Shri Dilip Laximan Powar, through his Power of Attorney, challenged a notice dated 19.03.2024, issued under Section 148-A(b) of the Income Tax Act. The petitioner contended that the notice was issued beyond the three-year period stipulated by law and was based on an internal audit objection rather than any new material facts. The petitioner had already filed returns for the relevant assessment year (2017-18), which were accepted by the Income Tax Department after scrutiny.

Contentions of the Respondent:

The Income Tax Officer defended the notice, arguing that it was based on specific information from the Internal Audit Party regarding the deposit of specified bank notes during the demonetization period, which suggested that income had escaped assessment. The respondent maintained that the notice was valid under the amended provisions of Sections 147 to 149 of the Income Tax Act.

Court's Analysis:

The court examined the provisions of Section 148 and the case law, particularly the Supreme Court's decision in Mangalam Publications v/s. Commissioner of Income Tax. The court found that the reassessment notice was based on a change of opinion, as the same issue had already been examined during the original assessment. The court ruled that such a change of opinion could not form the basis for reopening an assessment.

Conclusion:

The court quashed the reassessment notice, holding that it was issued without proper grounds and in contravention of the law. The judgment underscores the judiciary's role in ensuring that tax authorities do not misuse their powers by reopening assessments based on reconsideration of previously examined issues.