No Additions Proposed in Income Tax  Assessment Order: Madras HC quashes Demand in Computation Sheet and Notice [Read Order]

In a recent ruling, the Madras High Court quashed the demand in Computation Sheet  and Notice as no additions were proposed in the income tax assessment order.

The Petitioner, Organization for Eelam Refugees Rehabilitation having filed the income tax return for the assessment year 2022-2023, an intimation was received under Section 143(1) of the Income Tax Act, 1961, processing the return and accepting the refund claim. Subsequently, the assessment underwent scrutiny, resulting in an assessment order dated 09.03.2024, which accepted the return of income without proposing any additions.

However, despite the assessment order's conclusion, the petitioner was startled by a demand for payment amounting to Rs.5,04,29,383/- as per the computation sheet and demand notice. Promptly, the petitioner filed a writ petition challenging this demand.

During proceedings, the petitioner's counsel highlighted the absence of any proposed additions in the assessment order and pointed out glaring errors in the computation sheet and demand notice.

Mrs. S. Premalatha, junior standing counsel, representing the respondents, acknowledged a discrepancy between the assessment order and the impugned communications.

A single bench of Justice Senthilkumar Ramamoorthy observed that “On perusal of the assessment order, it is clear that it was concluded therein that no addition is being made in relation to the issues mentioned in paragraph 1 thereof. In those circumstances, the demand made in the computation sheet and the demand notice cannot be sustained”.

Accordingly, the Madras High Court allowed the writ petition by quashing the impugned computation sheet and the consequential notice of demand.

To Read the full text of the Order CLICK HERE

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