Case Law Details
Nazirpur Large Sized Multipurpose Co-op Society Ltd. & Anr. Vs Union of India & Ors. (Calcutta High Court)
The Calcutta High Court recently addressed procedural discrepancies in income tax assessments in the case of Nazirpur Large Sized Multipurpose Co-op Society Ltd. & Anr. vs Union of India & Ors. The court’s decision focused on a demand notice issued under Section 156 of the Income Tax Act, 1961, despite a zero-assessment outcome for the assessment year 2015-16.
The petitioners challenged the demand notice issued by the Faceless Assessment Unit, arguing that it contradicted the assessment order that had concluded their income tax liability at zero rupees. Despite the reassessment under Section 147 read with Section 144B of the Income Tax Act, the demand notice sought a substantial sum, including interest, based on technical glitches rather than the actual assessment findings.
The court scrutinized the assessment process, noting that the Faceless Assessment Unit had acknowledged no adverse findings against the petitioners’ tax return. It emphasized that once the assessment had accepted the filed income as zero, issuing a demand notice for an amount contradicted the legal findings and procedural fairness standards.
In its ruling, the Calcutta High Court quashed the demand notice dated March 19, 2024, emphasizing that it was issued mechanically and in contradiction to the assessment order. This decision reaffirms the importance of adherence to assessment outcomes and procedural integrity in tax matters, ensuring that taxpayers are treated fairly and in accordance with the law.
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Thanks for sharing case law