Case Law Details
Rajesh Kumar Malhotra Vs ACIT (Delhi High Court)
The recent decision by the Delhi High Court has significant implications for the 2018-19 tax assessment of Rajesh Kumar Malhotra. The court found procedural violations and inadequate opportunities for the petitioner’s defense, leading to the quashing of the assessment.
The crux of the matter revolves around a notice dated 27th March 2022, issued under Section 148 of the Income Tax Act, 1961. The petitioner argued that compliance time for the Show Cause Notice dated 21st March 2022 was insufficient, violating statutory norms. Furthermore, the notice contained contradictory information, creating confusion about the assessment year in question.
The petitioner, in response to the notice, highlighted that the alleged Long Term Capital Gains (LTCG) on shares of Achal Investments Ltd. pertained to the Assessment Year 2015-16, not 2018-19. The court acknowledged that the petitioner had already addressed this issue in a previous assessment under Section 143(3) of the Act.
The court observed that the order under Section 148A(d) lacked factual correlation with the show-cause notice, raising concerns about accuracy and procedural fairness. The petitioner claimed to have submitted a response, along with relevant documents, on 22nd March 2022, contrary to the order’s assertion of non-compliance.
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