Section 245 Income Tax refund adjustments must adhere to principles of natural justice

Trent Ltd. Vs Deputy Commissioner (Bombay High Court) Bombay High Court ruled in favor of Trent Ltd. against the Deputy Commissioner of Income Tax, quashing the adjustment of ₹4.91 crore from the company’s tax refund against an outstanding demand for Assessment Year 2018-19. The court found that the adjustment was made without following the due process required under Section 245 of the Income Tax Act, 1961. Trent Ltd. was not given a hearing, and no formal order was passed before the adjustment was made. The company had submitted objections in December 2023, which were ignored by the t...