Gautam Walia Vs PCIT (Delhi High Court)
Delhi High Court has expressed concern over the repeated rectification of income tax intimations by the Central Processing Centre (CPC), setting aside an order that again enhanced an assessee’s income after a prior rectification. The Court has remanded the matter back to the Assistant Commissioner of Income Tax (ACIT) for a fresh review, specifically questioning the CPC’s authority to “rectify and re-rectify” intimations multiple times.
The case involves Gautam Walia, who filed his income tax return for Assessment Year 2019-20, declaring an income of ₹28,63,160/-. An initial intimation under Section 143(1)(a) of the Income Tax Act, 1961, was issued on April 29, 2020, along with a refund. However, on July 5, 2021, the Assistant Director of Income Tax, CPC, suo moto rectified this intimation under Section 154, significantly increasing the chargeable income to ₹1,00,20,780/- by disallowing certain deductions, without prior notice or hearing to Walia.
Walia challenged this rectification before the Commissioner of Income Tax (Appeals) [CIT(A)], who, on July 30, 2024, set aside the rectification order, citing the absence of notice to the petitioner. However, the ACIT subsequently issued a new notice and order under Section 154, once again enhancing Walia’s income to the same higher amount by rectifying the original intimation.
