Santosh Hospital P. Ltd. Vs ACIT (ITAT Delhi)
Income Tax Appellate Tribunal (ITAT), Delhi, has ruled in favor of Santosh Hospital P. Ltd., quashing an assessment order is-sued by the Assistant Commissioner of Income Tax (ACIT) for the assessment year 2014-15. The tribunal upheld the hospital’s contention that the assessment was invalid due to non-compliance with mandatory legal requirements under the Income Tax Act.
The case stemmed from a search conducted on a third party in June 2013, leading the Assessing Officer (AO) to record satisfaction in September 2015 to initiate proceedings against Santosh Hospital. The hospital raised several additional grounds of appeal, which the ITAT admitted, citing Supreme Court precedents emphasizing the adjudica-tion of fundamental legal issues.
One of the primary grounds was the alleged invalidity of the assessment due to the lack of a valid notice under Section 143(2) of the Income Tax Act. The hospital argued that while it filed its income tax return in December 2014, the AO issued the notice under Section 143(2) on the very same day it acknowledged the filing – October 26, 2015. This, according to the hospital, demonstrated a clear non-application of mind by the AO be-fore issuing the crucial notice for scrutiny.
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