M/S RAJLAXMI MINERALS vs INCOME TAX OFFICER
- Court
- Gujarat High Court
C/SCA/13289/2025 (GJHC240629612025) JUDGMENT DATED: 25/08/2026
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 13289 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE A.S. SUPEHIA
and
HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
=====================================================
Approved for Reporting Yes No
✔
=====================================================
M/S RAJLAXMI MINERALS
Versus
INCOME TAX OFFICER
=====================================================
Appearance:
MR VIJAY H PATEL(7361) for the Petitioner(s) No. 1
MR AADITYA D BHATT(8580) for the Respondent(s) No. 1
=====================================================
CORAM:HONOURABLE MR. JUSTICE A.S. SUPEHIA
and
HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
Date : 25/08/2026
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE A.S. SUPEHIA)
1. With the consent of the learned counsels appearing for the
respective parties, the matter is taken up for final hearing for final
disposal.
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C/SCA/13289/2025 (GJHC240629612025) JUDGMENT DATED: 25/08/2026
2. In the present petition, the petitioner which is a partnership
firm, challenges the order dated 16.06.2025 passed under Section
148A(3) of the Income Tax Act, 1961 (for short ‘the IT Act, 1961’)
and the consequential notice issued under Section 148 of the IT
Act, 1961 dated 16.06.2025 proposing the reopening of the
assessment for Assessment Year (for short ‘AY’) 2019-20.
3. During the year under consideration, petitioner entered into two
financial transactions; (i) purchase of three vehicles on loan for the
total cost of Rs.1,35,92,001/-, and (ii) repayment of loans by EMIs
by Partners of the petitioner amounting to Rs.26,49,130/-.
4. A Notice dated 28.03.2025 was issued to the petitioner under
Section 148A(1) of the IT Act, 1961, calling upon the petitioner to
explain as to why Notice under Section 148 of the IT Act, 1961
should not be issued, alleging that the income to the tune of
Rs.92,04,500/- has escaped assessment.
5. Petitioner filed its reply on 25.04.2025 explaining the details,
the entire transactions and the loan statements as well as books of
accounts. However, the respondent ignored the explanation
tendered by the petitioner and passed the impugned order dated
16.06.2025 under Section 148A(3) of the IT Act, 1961 and the
consequential Notice under Section 148 of the It Act, 1961.
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C/SCA/13289/2025 (GJHC240629612025) JUDGMENT DATED: 25/08/2026
6. At the outset, learned advocate Mr.Vijay Patel appearing for the
petitioner has submitted that the respondent ought to have
dropped the reopening of the assessment, after the tendering of
the explanation by the petitioner to the show cause notice, more
particularly, when petitioner had clarified that the alleged
escapement of the income is below the threshold limit of Rs.50
lakhs, and hence, the conditions prescribed under Section 149(1)(b)
of the IT Act, 1961 are required to be satisfied. He has also
referred to the impugned order, wherein, the Assessing Officer has
admitted that the total cash paid during the repayment of the loan
amounts to Rs.45,79,481/-, which is below the threshold limit of
Rs.50 lakhs as required under the provision of Section 149(1)(b) of
the IT Act, 1961. Hence, it is urged that the reopening of
assessment may be quashed.
7. Per contra, learned Senior Standing Counsel Mr.Aaditya Bhatt
appearing for the respondent authority has urged that the writ
petition may not be entertained, as the petitioner has failed to
establish the source of funds for the purchase of vehicles. He has
submitted that the figure of Rs.1.76 crores, as referred in the
impugned order passed under Section 148A(3) IT Act, 1961, is
above the threshold limit of Rs.50 lakhs, and hence, the reopening
may not be interfered with.
8. We have heard the learned counsels appearing for the
respective parties at length.
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C/SCA/13289/2025 (GJHC240629612025) JUDGMENT DATED: 25/08/2026
9. The facts as mentioned hereinabove relating to the purchase of
three vehicles by the petitioner on loan involving the amount of
Rs.1,35,92,001/-, is not in dispute. It is also not disputed that the
funds were availed by way of loan from Induslnd Bank for an
aggregate value of Rs.1,17,13,000/- and by way of funds received
from the Partners of the petitioner to the tune of Rs.18,79,001/-.
10. The petitioner had paid the monthly EMIs directly to the term
loan accounts of three vehicles totalling to Rs.26,49,130/-, and
hence, as per the impugned order passed under Section 148A(3) of
the IT Act, 1961, the Assessing Officer has noticed that the total
amount paid by the assessee firm while disbursing the loan in
cash is Rs.45,79,481/-. Thus, unquestionably, even as per the
order passed by the Assessing Officer, the same is below the
threshold limit of Rs.50 lakhs as envisaged under the provision of
Section 149(1)(b) of the IT Act, 1961. Hence, the impugned order
dated 16.06.2025 under Section 148A(3) of the IT Act, 1961 as
well as Notice under Section 148 of the IT Act, 1961 are required
to be quashed and set aside, and the same are hereby quashed
and set aside.
The petition stands allowed accordingly.
Sd/-
(A. S. SUPEHIA, J)
Sd/-
(VAIBHAVI D. NANAVATI,J)
Pradhyuman/49
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