The Court directs the Assessing Officer to reconsider objections with new evidence presented by Naresh Goyal.
In a significant judgment dated July 7, 2026, the Bombay High Court has quashed the impugned order disposing of objections against the reopening of income tax assessment of Naresh Jagdishrai Goyal, concerning the assessment year 2014-2015. The Bench, comprising Justices B.P. Colabawalla and Firdosh P. Pooniwalla, directed the Deputy Commissioner of Income-tax, Mumbai, to reconsider the objections after reviewing additional evidence submitted by the petitioner, Naresh Goyal.
The case involves the reopening of Goyal's income tax assessment under Section 148 of the Income Tax Act, 1961. The primary contention was the absence of a "reason to believe" that income had escaped assessment. The Assessing Officer initially relied on information from DCIT (International Taxation), suggesting non-disclosure of income involving transactions with M/s. Tail Winds Ltd., a foreign company linked to Goyal.
In response, Goyal challenged the reopening notice, asserting the Assessing Officer's belief was based on borrowed information without independent verification. He provided detailed evidence, including transactions funded through loans from HSBC Geneva, to substantiate the source of funds for purchasing shares of Jet Airways (India) Ltd.
The Court noted that Goyal had submitted further documentation on March 8, 2022, which was not considered in the initial order. The judges emphasized that the Assessing Officer must evaluate all relevant submissions and documents before disposing of objections. Consequently, the Court ordered the impugned decision set aside and directed the Assessing Officer to pass a fresh order, considering the new evidence within six weeks.
Furthermore, the sanction for reopening the assessment must be furnished to Goyal within two weeks. The Court has kept the door open for Goyal to approach them again if dissatisfied with the fresh order.
This judgment underscores the necessity for tax authorities to independently verify facts and consider all evidence in assessments, ensuring due process and adherence to legal standards.
Bottom line:-
Income Tax Act - Reopening of assessment - Assessing Officer must consider all relevant submissions and documents provided by the assessee before disposing of objections to reopening - Fresh order to be passed after considering additional evidence submitted.
Statutory provision(s): Sections 147, 148, 143(2), and 142(1) of the Income Tax Act, 1961.
