INCOME TAX ACT, 1961

Section 50 Section 51

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During search at assessee's premises certain documents were found and seized. AO issued show-cause dt. 1-5-2019 under section 50 and 51 of the Black Money Act, 2015 against assessee, wherein it was alleged that assessee had under-reported total investment in his foreign Assets by GBP 2.73 lakhs and thereby, had wilfully attempted to evade tax. Assessee submitted that information provided in show-cause notice was factually incorrect and payments made by assessee for London property had been duly and properly mentioned in Income Tax Return for assessment year 2018-19. Assessee requested Income Tax Authority to adjourn the matter for a fortnight for submitting detailed response but that request was rejected by AO vide Emails dated 2-5-2019 and assessee was directed to file factual reply/ submission of show-cause notice by 2-5-2019. Assessee again requested for grant of adjournment but criminal complaint was filed on 3-5-2019 declining request of assessee to grant reasonable time to furnish his submissions. Assessee by way of misc. writ petition filed before High Court sought issuance of appropriate writ, order or direction to call for records leading to the issuance of Show cause notices dated 1-5-2019 under section 50 and 51 of Black Money Act 2015, the Assessment order (if any existed on record), the Sanction order (if any existed on record) and the complaints under section 50 and 51 of Black Money Act 2015 and quashing the same as illegal, arbitrary and violative of fundamental rights of assessee since assessee was denied opportunity of hearing before according sanction for launching prosecution of assessee as much as show-cause notice was issued on 1-5-2019 and complaint was filed on 3-5-2019 by declining the request of assessee to grant reasonable time to put his submissions and the sanction order was also passed without giving opportunity of personal hearing to assessee.Held: Assessee could not show any such legal or mandatory requirement that before according sanction or instituting prosecution, opportunity of hearing had to be given to the accused. Further, show-cause notices dated 1-5-2009 and 2-5-2010 were issued to assessee to put his submissions. Also, in view of legal position and allegations made against assessee and perusing the material on record including sanction order, it could not be said that no prima facie case was made out against assessee or that the assessee deserved any relief claimed by him. Accordingly petition lacked merit and was thus, liable to be dismissed.

REFERRED : AIR 1992 SC 605 State of Haryana & Ors. v. Ch. Bhajan Lal.

FAVOUR : Against the assessee.

A.Y. :

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