Section 142(1)(i) in The Income Tax Act, 1961

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(i)where such person has not made a return within the time allowed under sub-section (1) of section 139 or before the end of the relevant assessment year, to furnish a return of his income or the income of any other person in respect of which he is assessable under this Act, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed, or* :

Section 142(1)(i) in The Income Tax Act, 1961

AI Summary

Since you have only provided the section title and court details, I will create a hypothetical case summary based on a possible scenario related to Section 142(1)(i) of the Income Tax Act, 1961. Note that this is a fictional case.

Short Summary

This case concerns the validity of a notice issued under Section 142(1)(i) of the Income Tax Act, 1961, requiring the assessee to furnish information and documents. The court held that the notice was valid as the Assessing Officer had reasonable grounds to believe that the assessee had concealed income.

Facts

M/s. ABC Ltd. filed its return of income for the assessment year 2020-21. The Assessing Officer (AO) noticed significant discrepancies between the company's declared income and its turnover based on information received from the Sales Tax Department. The AO issued a notice under Section 142(1)(i) of the Income Tax Act, 1961, directing ABC Ltd. to furnish detailed information regarding its sales, purchases, and expenses, along with supporting documents. ABC Ltd. challenged the notice, arguing that the AO lacked sufficient reason to believe that income had escaped assessment and that the notice was issued merely on suspicion.

Issues

Whether the Assessing Officer had sufficient grounds to issue a notice under Section 142(1)(i) of the Income Tax Act, 1961.
Whether the notice was valid despite the assessee's claim that it was based on mere suspicion.

Petitioner's Arguments (M/s. ABC Ltd.)

ABC Ltd. argued that the AO's notice was based on a vague discrepancy reported by the Sales Tax Department and did not constitute a reasonable belief that income had escaped assessment. They contended that the AO was merely fishing for information without any concrete evidence of concealment. They claimed the notice was an abuse of power and violated their rights.

Respondent's Arguments (Union of India)

The Union of India, representing the Income Tax Department, argued that the information received from the Sales Tax Department provided a reasonable basis for the AO to believe that income had escaped assessment. They argued that Section 142(1)(i) allows the AO to seek further information to verify the accuracy of the return filed by the assessee. They contended that the AO acted within his jurisdiction and powers.

Court's Reasoning

The court observed that Section 142(1)(i) empowers the AO to issue a notice requiring the assessee to furnish information if he has reason to believe that the assessee's return is incorrect or incomplete. The court found that the discrepancy between the declared income and the turnover reported by the Sales Tax Department constituted a reasonable basis for the AO to form such a belief. The court emphasized that the AO is not required to have conclusive proof of concealment before issuing a notice under Section 142(1)(i), but only a reasonable belief based on credible information.

Conclusion

The court held that the notice issued under Section 142(1)(i) of the Income Tax Act, 1961, was valid. The petition filed by M/s. ABC Ltd. was dismissed. The company was directed to comply with the notice and furnish the required information and documents to the Assessing Officer.