Assessee cannot be Prejudiced by the Inaction of the Assessing Officer: Delhi HC directs the Revenue to Grant Immunity under Section 270AA [Read Order]

The High Court of Delhi has held that assessee cannot be prejudiced by the inaction of the Assessing Officer and directs the revenue to grant immunity under Section 270AA.

The petitioner, Ultimate Infratech Private Limited had filed its return of income for the assessment year 2017-18 declaring a loss of Rs.1,51,57,259/-.  Scrutiny assessment u/s 143(3) of the Act bringing to tax Rs.43,55,548/- as “business income” of the Petitioner and consequently assessed the total income of the Petitioner at a loss of Rs.1,08,01,711/-, raising tax demand of Rs.NIL.

Further show cause notice seeking to levy penalty under Section 270A read with Section 274 of the Act was issued against the petitioner. The petitioner is before the High Court against the order denying relief under Section 270AA(2) seeking immunity from imposition of penalty under Section 270A of the Act.

The petitioner submitted that under Section 270AA of the Act the respondent has failed to appreciate that once the conditions specified in Section 270AA of the Act are satisfied, the assessing officer was bound to grant immunity to the petitioner.

The High Court observed that the petitioner cannot be prejudiced by the inaction of the Assessing Officer in an order under Section 270AA of the Act within passing the statutory time limit as it is settled law that no prejudice can be caused to any assessee on account of delay/default on the part of the Revenue

The division bench presided by Mr. Justice Manmohan and Mr. Justice Dinesh Kumar Sharma by relying its own decision in Schneider Electric South East Asia (HQ) Pte Ltd has held that “the impugned order under Section 270A of the Act is set aside and the respondents are directed to grant immunity under Section 270AA of the Act to the petitioner”.

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