Neeru Sehgal Vs PCIT (Delhi High Court)
Summary: The Delhi High Court considered a writ petition challenging the notice dated 31.08.2024 issued under Section 148 of the Income Tax Act, 1961. The petitioner contended that, for the very same reason and transaction, proceedings under Section 143(3) were already underway when the impugned notice was issued and had subsequently culminated in an assessment order dated 20.03.2025.
The petitioner submitted that during the scrutiny assessment, the Assessing Officer had considered the transaction in question, issued a questionnaire and examined the matter in detail. According to the petitioner, no addition was ultimately made because the Assessing Officer was satisfied with the reply furnished. The Revenue did not dispute this factual position.
Upon examining the assessment order dated 20.03.2025 and the show-cause notice dated 28.02.2025, the Court found that the question concerning Rs. 85,00,000/- being given in cash to Mr. Sachiv Sahni through Mr. Arjun Malhotra had already been examined in detail. The same transaction formed the basis of the impugned Section 148 notice.
The Court considered the reassessment framework under Section 148 read with Sections 147 and 143(3). It held that, since the very transaction had been examined in detail by the Assessing Officer during the scrutiny assessment, the impugned notice was nothing more than a mere change of opinion and was beyond the scope of the provisions contained in Sections 147/148 of the Act of 1961.
The writ petition was accordingly allowed and the impugned notice dated 31.08.2024 was quashed. The pending applications were also disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. By way of the present writ petition, the petitioner has challenged the notice dated 31.08.2024 issued under Section 148 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act of 1961’) on various grounds, including the ground that for the very same reason and in respect of the very same transaction, proceedings under Section 143(3) of the Act of 1961were underway and the same had culminated in an assessment order dated 20.03.2025.
2. Learned counsel for the petitioner argued that when the notice impugned was issued, assessment proceedings under Section 143(3) of the Act of 1961 for the very same assessment year were already being undertaken and the transaction in question, was under consideration of the Assessing Officer (AO) and as a matter of fact, he had issued questionnaire in this regard and examined the transaction in detail, (though made no addition being satisfied with the reply filed by the petitioner).
3. Mr. Indruj Singh Rai, learned Senior Standing Counsel for the respondents could not dispute the aforesaid position of facts.
4. Having heard learned counsel for the parties and upon perusal of the assessment order dated 20.03.2025, so also show-cause notice dated 28.02.2025, we find that a question in relation to an amount of Rs. 85,00,000/-being given in cash to Mr. Sachiv Sahni through Mr. Arjun Malhotra was very much examined in detail qua which the impugned notice under Section 148 of the Act of 1961 has been issued.
5. Considering that during the course of scrutiny assessment, this very transaction had been examined in detail by the AO, the impugned notice is nothing more than a mere change of opinion and is, therefore, beyond the scope of provisions contained in Section 147/148 the Act of 1961.
6. The writ petition is, therefore, allowed. The impugned notice dated 31.08.2024 is hereby quashed.
7. Pending application(s) also stand disposed of.
