Gyan Marketing Associates Pvt. Ltd. Vs ITO (Delhi High Court)
Delhi High Court held that facts narrated in notice u/s. 148A(b) couldn’t lead to conclusion that income has escaped assessment. Accordingly, reassessment proceedings initiated is liable to be set aside.
Facts- The petitioner has filed the present petition, inter alia, impugning a notice dated 10.04.2023 issued u/s. 148 of the Income Tax Act, 1961 in respect of A.Y. 2016-17. The petitioner also impugns a notice dated 20.03.2023 issued u/s. 148A(b) of the Act and the order dated 10.04.2023 passed u/s. 148A(d) of the Act, pursuant to the impugned notice. It is the petitioner’s case that notice issued u/s. 148A(b) of the Act does not set out any information that is suggestive of petitioner’s income escaping assessment. Thus, the reassessment proceedings initiated are wholly without jurisdiction.
Conclusion- Held that even assuming that the transactions were found to be non-genuine or non- existent, the same would not result in petitioner’s income escape assessment as the petitioner has in fact declared a profit of ₹60,00,000/- on sale of 1600 square feet to ACL and surrendered the same to tax. Thus, even these transactions are held to be paper transactions, as is contended by the learned counsel for the Revenue, the same would not result in petitioner’s income escaping assessment. The learned counsel for the Revenue was also unable to explain as to how the facts as narrated in the notice under Section 148A(b) of the Act could lead to the conclusion that the petitioner’s income for AY 2016-17 had escaped assessment. Thus, the impugned order passed under Section 148A(d) of the Act cannot be sustained. Accordingly, the impugned notice and impugned order are set aside.
