A division bench of the Delhi High Court has quashed a notice under section 148A of the Income Tax Act, 1961 by observing that the new provision cannot be invoked in case the matter of the assessee comes within the ambit of section 153C of the Act.
Sections 153A and 153C of the Income Tax Act, 1961, establishes a mechanism for assessing income in the instance of a searched individual. According to the aforementioned section, the Assessing Officer has the authority to frame an individual’s assessment for the six assessment years immediately preceding the year of search.
The Petitioner, Mr. Pradeep Kumar Varshney contended that in the present case notice under Section 148A is not warranted as it is a case of Section 153C of the Act to which proviso (c) of Section 148A applies.
As per the relevant provision, the same shall not be applicable in a case where “(c) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner that any books of account or documents, seized in a search under section 132 or requisitioned under section 132A, in case of any other person on or after the 1st day of April, 2021, pertains or pertain to, or any information contained therein, relate to, the assessee.”
After analysing the provisions of Section 148A of the Act, Justice Manmohan and Justice Manoj Kumar Ohriobserved that “Since the case of the petitioner is admittedly covered by proviso (c) to Section 148A, this Court is of the view that the impugned order and notice are untenable in law. Accordingly, both the impugned order and notice dated 9 thApril, 2022 are set aside and the matter is remanded back to the Assessing Officer to pass a fresh reasoned order in accordance with law.”
Mr. Amol Sinha, Mr. Nitin Gulati, Mr. Sushant Sarkar, Mr. Ashvini Kumar, Mr. Rajiv Shankar Dvivedi and Mr. Rishabh Jain, Advocates appeared for the petitioner-assessee.
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