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DELHI HIGH COURT
MANMOHAN, MANMEET PRITAM SINGH ARORA
Balesh Jain Sons HUF – Appellant
Versus
Assisstant Commissioner of Income Tax – Respondent
| Table of Content |
|---|
| 1. challenge to show cause notice and orders under the income tax act. (Para 1 , 2) |
| 2. allegations of accommodation entries and the petitioner's denial. (Para 3 , 4) |
| 3. court's observation on provision of documents in notices. (Para 5) |
| 4. directions for proceedings and additional submissions. (Para 6) |
| 5. disposal of writ petition. (Para 7) |
JUDGMENT
Manmohan, J. (Oral):
1. Present writ petition has been filed challenging the show cause notice dated 17th May, 2022 issued under Section 148A(b) of the Income Tax Act, 1961 [`the Act'] as well as order dated 29th June, 2022 issued under Section 148A(d) of the Act for the Assessment Year 2014-15.
2. On 18th August, 2022, this Court had issued notice in the present writ petition. The relevant portion of the order dated 18th August, 2022 is reproduced hereinbelow:
"Learned counsel for the petitioner states that the Petitioner filed its return of income for the relevant Assessment Year declaring an income of Rs.10,80,404/-and an intimation under Section 143(1) of the Act was issued. He states that the Petitioner received the impugned show cause notice dated 17th May, 2022 issued under Section 148A(b) of the Act seeking income
Procedural fairness in tax reassessment mandates that taxpayers are provided all relevant documents and information before being called to respond to allegations, ensuring a fair opportunity for defe....
The court emphasized the importance of providing all relevant material and documents to the petitioner in a fair and balanced manner, ensuring that the rights and contentions of all parties are left ....
Second notice under Section 148A(b) is invalid when an initial notice under Section 148 has already been served; Supreme Court directions pertain to a different timeframe and do not apply.
A show cause notice under Section 148A(b) of the Income Tax Act must contain specific allegations of income escapement; its absence renders the assessment invalid.
Administrative orders can be set aside by courts if found to be flawed in execution, ensuring rectification of inaccuracies in legal processes.
The Court affirmed that vague show cause notices issued under Section 148A(b) lack compliance with natural justice, necessitating clear material for Assessee responses.
Assessing Officers must provide specific details in notices for effective response by Assessee, adhering to principles of natural justice.
Orders based on vague allegations without specific details violate the right to a fair hearing under tax law.
The failure of the Assessing Officer to consider the petitioner's reply before issuing an order under Section 148A(d) constitutes a breach of natural justice, invalidating the order.
For a valid reassessment under Income Tax Act, prior recording of reasons for income escapement is mandatory; failure to do so renders the notice void, allowing proceedings on a subsequent properly s....
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