Rs. 50 Lakh limit for Re-assessment: There is difference between Income and Income Chargeable to tax
There is a difference between Income and Income Chargeable to tax. The Limit of Rs.50 Lakhs as mentioned u/s 149 is in relation to Income Chargeable to tax and not applicable on Gross Income. It is held by MP High court in the case of NITIN NEMA VERSUS OFFICE OF PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, 2023 (8) TMI 1027 – MADHYA PRADESH HIGH COURT WRIT PETITION No. 8311 of 2023 ORDER Dated.- August 16, 2023 Decision also upheld by Hon’ble Supreme court- No.- SPECIAL LEAVE PETITION (CIVIL) DIARY NO(S). 38708/2024 Dated.- September 17, 2024
When petitioner/assessee filed a reply to the notice u/s 148(A)(b) it was clearly revealed that the said amount is the gross receipt of sale consideration of 16 scooters. Meaning thereby, that the said amount 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.
While considering the said reply and before passing the impugned order under Section 148A(b) of the IT Act, a 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.
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 income coming down to a figure below Rs.50 lacs cannot be ruled out
The Copy Of the order is as under:
