G.S.SINGHVI,J. - (1.) THE petitioner has invoked jurisdiction of this Court under Art. 226 of the Constitution of India for quashing the notice issued by the respondent under S. 148 of the IT Act, 1961 (for short, 'the Act'), proposing reassessment of his income for the asst. year 1997 98.
(2.) THE facts of the case are that on 31st Aug., 1997, the petitioner filed a return for the asst. yr. 1997 98 showing an income of Rs. 66,720. He also claimed refund of Rs. 12,145 towards the advance tax paid during the relevant year. The AO finalised the assessment under S. 143(1)(a) and granted refund in terms of the prayer made by the petitioner. Thereafter, he issued notice annexure P 2, dt. 31st Jan., 2000, and called upon the petitioner to file a return for the assessment of the income which had escaped assessment. In response to the notice, the petitioner filed the return Annexure P.3, dt. 1st March, 2000, showing his income at Rs. 66,720. Thereafter, vide Annexure P 4 the respondent conveyed the reasons for reopening the assessment. The same read as under : "Reasons for issuing notice under S. 148 : It has been learnt that the assessee purchased a plot for shop in the New Grain Market on 5th March, 1997. The consideration shown in the registration deed is at Rs. 3,00,000. It has been mentioned in the body of the registration deed that the stamp charges have been paid by the assessee at an enhanced figure as the market rate fixed by the Revenue authorities of this property is at Rs. 4.60 lakhs. The inspector of this office who was deputed to make enquiries in the matter about the market value of this property has reported that the market value is Rs. 8,00,000 approximately. It is, therefore, concluded that the assessee has suppressed the cost of construction and invested his unaccounted income to purchase the property. I have, therefore, reasons to believe that income chargeable to tax to the tune of Rs. 1,60,000 at least, has escaped assessment. Notice under S. 148 is being issued to the assessee to reassess the income which, as per the assessment already completed under S. 143(1)(a) on 23rd March ,1998, was worked out at Rs. 67,115." The petitioner has challenged the notice proposing reassessment of his income on the following grounds : (i) The payment of stamp duty for the purpose of registration of sale deed cannot constitute basis for forming a belief that his income had escaped assessment. (ii) The approximate value of the shop plot indicated in the reasons conveyed by the respondent is highly excessive and on that basis, the assessment cannot be reopened. (iii) The allegation of suppression of cost of construction contained in the reasons supplied by the respondent is false and vexatious because the plot is vacant and no construction has been made over it.
(3.) IN his written statement, the respondent has prayed for dismissal of the writ petition by asserting that it is premature. He has averred that no order adversely affecting the petitioner has been passed so far and, therefore, he cannot seek intervention of the Court at this stage. On the merits it has been averred that the petitioner had purchased shop plot for a much higher price than the one specified in the sale deed and it has been done with a view to avoid the payment of tax. According to the respondent, the impugned notice was issued in the light of revelation made about registration of sale deed by paying stamp duty in lieu of the value of the land which was shown as Rs. 4,60,000.;