Facts of the Case

The petitioner challenged an order dated 30.03.2022 passed under Section 148A(d) along with a consequential notice issued under Section 148 of the Income Tax Act.

A show cause notice under Section 148A(b) dated 23.03.2022 required the petitioner to respond by 30.03.2022. The petitioner submitted a reply on the same date. However, the impugned order incorrectly recorded that no reply had been filed.

The Revenue alleged that the petitioner was a beneficiary of bogus purchase bills from three entities. The petitioner contended that he had dealings with only two entities and that the alleged amount was wrongly inflated.

Issues Involved

  1. Whether an order under Section 148A(d) is valid when it ignores the reply filed by the assessee.
  2. Whether failure to consider objections violates principles of natural justice.
  3. Whether reassessment proceedings can sustain when factual inaccuracies exist in the order.

Petitioner’s Arguments

  • The reply was duly filed within the stipulated time (30.03.2022).
  • The impugned order erroneously recorded that no reply was filed.
  • The order failed to consider objections and explanations submitted.
  • Allegations regarding bogus purchases were factually incorrect and inflated.

Respondent’s Arguments

  • The Revenue acknowledged that the reply filed by the petitioner was on record.
  • It was conceded that the impugned order incorrectly stated that no reply had been filed.

Court’s Findings / Order

  • The Court held that the impugned order was flawed as it failed to consider the reply submitted by the petitioner.
  • On this ground alone, the order passed under Section 148A(d) was set aside.

Directions Issued:

  • Matter remanded to the Assessing Officer for de novo consideration.
  • Opportunity of hearing must be provided to the petitioner.
  • Relevant material and approvals under Section 151 must be furnished.
  • A speaking order must be passed after considering all submissions.

Important Clarification

  • Non-consideration of a reply filed by the assessee renders reassessment proceedings invalid.
  • Recording incorrect facts (such as stating no reply was filed when it was) is sufficient ground to set aside proceedings.
  • Principles of natural justice must be strictly followed in reassessment cases under Section 148A.


Link to download the order -https://delhihighcourt.nic.in/app/showFileJudgment/RAS01022023CW12442023_114017.pdf

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