Rajasthan High Court - Jodhpur
Jawari Lal Lunia vs Union Of India (2026:Rj-Jd:4064-Db) on 22 January, 2026
Author: Yogendra Kumar Purohit
Bench: Yogendra Kumar Purohit
[2026:RJ-JD:4064-DB]
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
D.B. Civil Writ Petition No. 1147/2022
Jawari Lal Lunia S/o Sh. Ghevar Chand, Aged About 73 Years, B-
32, Shastri Nagar, Jodhpur, Rajasthan 342003
----Petitioner
Versus
1. Union Of India, Through Secretary Finance, Ministry Of
Finance, North Block, New Delhi 110001
2. Principal Chief Commissioner Of Income Tax (Nafac),
North Block, New Delhi 110001.
3. Additional / Joint / Deputy / Assistant Commissioner /
Income Tax Officer, National Faceless Assessment Centre,
North Block, New Delhi - 110001
4. Deputy / Assistant Commissioner Of Income Tax, Circle-1,
Aaykar Bhawan, Paota, Jodhpur.
----Respondents
For Petitioner(s) : Mr. Sharad Kothari
Mr. Pranjul Mehta
Mr. Dinesh Kumar Bishnoi
Mr. Kalpit Shishodia
Mr. Chirag Soni
For Respondent(s) : Mr. K.K. Bissa
HON'BLE MR. JUSTICE ARUN MONGA
HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT Order 22/01/2026
1. Petitioner is before this Court challenging the reassessment proceedings under Section 147 read with Section 148 and Section 151 of the Income Tax Act, 1961 and the consequent order dated 03.12.2021 rejecting his objections.
2. Brief facts of the case are that the Petitioner is a resident of District Jodhpur, Rajasthan, engaged in the business of trading in handicrafts and textile items, and holds PAN AADPL8577E. 2.1 The Petitioner filed his return of income for Assessment Year 2013-14 under Section 139(1) of the Income Tax Act, 1961 on 30.09.2013, declaring total income of ₹81,32,740/-. The return was selected for compulsory scrutiny and an assessment under Section 143(3) was completed on 19.03.2016, determining total (Uploaded on 28/01/2026 at 04:40:45 PM) (Downloaded on 28/01/2026 at 08:37:51 PM) [2026:RJ-JD:4064-DB] (2 of 6) [CW-1147/2022] income at ₹1,02,59,750/-. The additions made therein were subsequently deleted in appeal, leading the Petitioner to bona fide believe that the assessment had attained finality. 2.2 During Financial Year 2012-13, the Petitioner had financial transactions with M/s Maharani Realtors Private Limited. At the beginning of the year, the ledger account reflected a debit balance of ₹2,43,80,000/-, establishing that the Petitioner was a creditor. Despite repayments aggregating to ₹2,21,00,000/- during the year, the Petitioner continued to remain a creditor as on 31.03.2013. The complete ledger account and supporting books were duly produced before the Assessing Officer during the original scrutiny proceedings.
2.3 Since the assessment was completed under Section 143(3), reopening beyond four years was permissible only upon failure of the Petitioner to fully and truly disclose all material facts. As all primary facts, including the ledger account and books of accounts, were disclosed, the Petitioner bona fide believed that no reopening could be initiated.
2.4 However, the Petitioner received a notice dated 22.12.2020 under Section 133(6) of the Act seeking details of transactions with Maharani Realtors Private Limited, followed by a notice dated 28.03.2021 under Section 148 reopening the assessment for A.Y. 2013-14. Without prejudice, the Petitioner furnished complete details and filed a return in response to the Section 148 notice, while seeking reasons recorded and sanction under Section 151. However, vide impugned order dated 03.12.2021, the objection of the petitioner were rejected.
(Uploaded on 28/01/2026 at 04:40:45 PM) (Downloaded on 28/01/2026 at 08:37:51 PM) [2026:RJ-JD:4064-DB] (3 of 6) [CW-1147/2022]
3. Heard learned counsel for the parties and perused the material available on record.
4. Learned counsel for the petitioner argues that the reasons supplied for reopening reveal fundamental factual errors and contradictions. While relying on information relating to Maharani Realtors Private Limited, the Assessing Officer wrongly presumed that the Petitioner had received unsecured loans of ₹2,21,00,000/-, whereas the Petitioner was, in fact, the lender. Despite acknowledging disclosure of balance sheets and financial statements, the Assessing Officer alleged failure of full and true disclosure without specifying any omission.
4.1. He would submit that the sanction under Section 151 was granted in a mechanical manner, merely stating satisfaction without application of mind. The Petitioner's detailed objections dated 27.11.2021, demonstrating absence of jurisdictional preconditions for reopening beyond four years, were mechanically rejected on 03.12.2021, followed by issuance of notice under Section 142(1) on the same date.
4.2. The impugned reopening is based on borrowed satisfaction, lacks any tangible material or live nexus with alleged escapement of income, and amounts to a fishing and roving inquiry.
5. Mr. K.K. Bissa, learned counsel for the respondents, supports the impugned order and seeks dismissal of the instant petition.
6. It transpires that the based on the same facts and contradiction on the same very material and by the same very Officer two show cause notices were issued both to the petitioner as well as his wife to which respective objections were filed by both of them taking the same para material stand.
(Uploaded on 28/01/2026 at 04:40:45 PM) (Downloaded on 28/01/2026 at 08:37:51 PM) [2026:RJ-JD:4064-DB] (4 of 6) [CW-1147/2022]
7. Pursuant thereto two different impugned orders were passed and even the reasons assigned therein are also on the same lines.
8. Both husband and wife filed separate writ petitions. The wife of the petitioner herein i.e. Vimla Devi Lunia numbered as D.B. Civil Writ Petition No.2709/2022 which was though filed after the husband had already filed the instant writ petition.
9. The petition of his wife was heard by Co-ordinate Bench of this Court and was disposed of vide an order dated 23.09.2025 which is worded as below:-
"1. Petitioner is unhappy with reopening of assessment and order dated 25th January 2022 rejecting petitioner's objections to notice under Section 148 of the Income Tax Act, 1961 (for short, 'the Act').
2. Petitioner is an individual who filed return of income on 31 st July 2013 for Assessment Year 2013-2014 in terms of sub-section (1) of Section 139 of the Act. Petitioner declared a net total income of Rs. 27,17,730/- and paid taxes of Rs.7,12,674/-. Return was picked for compulsory scrutiny and an assessment order dated 19th March 2016 under Section 143(3) of the Act was passed by assessing income at Rs. 33,05,230/-. Petitioner challenged additions in an appeal and appeal came to be allowed in favour of petitioner.
3. It is also necessary to note that during the course of scrutiny assessment petitioner received notices under Section 142(1) as also Section 143(2) and petitioner replied to those notices. A specific query was raised calling upon petitioner to furnish details of secured loans and advances taken during the year under consideration along with copy of accounts statement of parties as also bank accounts along with bank pass-book etc. All details were made available following which assessment order under Section 143(3) of the Act was passed on 19 th March 2016.
4. Even in assessment order dated 19th March 2016 passed under Section 143(3) of the Act, it is recorded that notice/questionnaire was issued on 19th August 2015 and served upon assessee and in compliance of these notices, Chartered Accountant of assessee attended proceedings from time to time and filed necessary details and the case was discussed.
5. Thereafter, petitioner received a notice dated 28th March 2021 under Section 148 of the Act stating that there are reasons to believe that petitioner's income chargeable to tax for Assessment Year 2013-14 has escaped assessment within the meaning of Section 147 of the Act.
6. Petitioner was provided reasons to believe, in which it is alleged that information from DIT(I&CI), Jaipur was received on 24 th March 2021 on Insight Portal. Petitioner's case was flagged by system as 'High Risk CRIU/VRU'. On going through the information and details available, it was found that during the year under consideration assessee received unsecured loan of Rs. 2,36,66,658/- from Maharani Realtors Pvt. Ltd. Jodhpur in Financial Year 2012-13 and petitioner did not submit documents and information related to the unsecured loans. Therefore, there was reason to believe that income of Rs.2,36,66,658/- was chargeable to tax and has not been disclosed by assessee.
7. In short, petitioner is supposed to have received unsecured loan of Rs.2,36,66,658/- from Maharani Realtors Pvt. Ltd. in Financial Year 2012-2013 which has escaped assessment.
8. The fact is that petitioner has not received any loan from Maharani Realtors Pvt. Ltd. but on the contrary, has given loan to Maharani Realtors Pvt. Ltd.
9. With the assistance of Mr. Kothari, we have gone through records and it is quite obvious that it is petitioner who has given loan to Maharani Realtors Pvt. Ltd.
(Uploaded on 28/01/2026 at 04:40:45 PM) (Downloaded on 28/01/2026 at 08:37:51 PM) [2026:RJ-JD:4064-DB] (5 of 6) [CW-1147/2022] and therefore, it is obvious there is non-application of mind while forming reasons to believe for escapement of income and on this ground alone, notice has to be quashed and set aside.
10. Moreover, when admittedly what petitioner has received is a loan certainly that cannot be an income and on this ground also, notice has to be quashed and set aside.
11. It is rather strange that approval under Section 147 of the Act, given by specified authority for initiating proceedings reflects again non-application of mind by Deputy Commissioner of Income- Tax, who has decided to reopen as also Principle Commissioner, who has granted approval and that too by recording "in view of reasons recorded, I am satisfied that it is a fit case for reopening".
12. The fact that petitioner has given loan or the fact that a loan can never be treated as an income have been given a go-bye.
13. In any event, during the course of assessment proceedings, petitioner was issued notice under Section 143(2) on 30 th September 2015 calling upon petitioner to furnish details of secured loans and advances during the year under consideration along with bank account details and bank pass book. Petitioner replied vide Chartered Accountant's letter dated 24th November 2015 and admittedly provided confirmation of loans and advances as also bank accounts with narratives. In the documents provided there is confirmation of accounts by Maharani Realtors Pvt. Ltd., which provides that during the year an amount of Rs.3,53,75,000/- was given as loan and during the year, Rs.2,36,66,658/- was repaid, leaving a closing balance of Rs.1,52,58,342/-. The bank account statement of IDBI has also been given and after considering all documents, assessment order dated 19th March, 2016 came to be passed.
14. Therefore, as held in Aroni Commercials Limited vs. The Dy. Commissioner of Income Tax-2(1)1 and in Marico Limited vs. The Assistant Commissioner of Income Tax2, once Assessing Officer had applied his mind in the regular assessment proceedings, it is not open for Assessing Officer to reopen the assessment. Assessing Officer cannot reopen assessment merely on the basis of change of opinion and could not have issued notice for reopening of assessment to petitioner.
15. Moreover, assessment sought to be reopened is after a period of four years. The criteria for reopening of assessment after a period of four years is no longer res integra. Courts have time and again held that if reopening is after expiry of four years from the end of relevant assessment year, then reopening is permissible only in case of failure to truly and fully disclose material facts. In the reasons to believe itself in paragraph 5, it is admitted that assessee had filed return of income where various information/materials were disclosed and assessee has also furnished documents in support of loans received as confirmation of accounts. Therefore, certainly, there is no failure to truly and fully disclose material facts. On this ground alone, notice has to be quashed and set aside.
16. Assessing Officer, however, goes a step further to say that on examination of return of income and information available with department, it is clear that party from which assessee had shown secured loan has only meager income and onus is on assessee to prove the identity, creditworthiness and genuineness of parties. All these details were provided to Assessing Officer during assessment proceedings and therefore, it is nothing but a case of change of opinion. In any event, as noted earlier, assessee has not received any loan from any party whereas it is assessee who has given loan to Maharani Realtors Pvt. Ltd.
17. In the circumstances, for reasons recorded above, it is an absolute misadventure on the part of revenue authorities and therefore, notice dated 28th March 2021 issued under Section 148 of the Act has to be quashed and set aside. Ordered accordingly.
18. Consequently, order on objections will not survive and the same is also quashed and set aside.
19. Petition disposed. No order as to cost."
10. In view of the aforesaid view taken by the learned Division Bench of this Court with which we are in respectful agreement, we (Uploaded on 28/01/2026 at 04:40:45 PM) (Downloaded on 28/01/2026 at 08:37:51 PM) [2026:RJ-JD:4064-DB] (6 of 6) [CW-1147/2022] find no reason why the instant writ petition be also not allowed. Accordingly it is so ordered and the petition stands allowed.
11. Impugned order is set aside with consequences to follow.
(YOGENDRA KUMAR PUROHIT),J (ARUN MONGA),J
56-suraj/-
(Uploaded on 28/01/2026 at 04:40:45 PM)
(Downloaded on 28/01/2026 at 08:37:51 PM)
Powered by TCPDF (www.tcpdf.org)