M/S INDEPENDENT MEDIA SERVICES LTD vs. ASSESSING OFFICER, CIRCLE 10(1) & ANR.

PDF · subscribers
W.P.(C)/11601/2024HC DelhiDLHC01052894202402 July 2025Author: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA6 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the impugned order dated 08.04.2024 passed under Section 148A(d) of the Income Tax Act, 1961, could not be sustained. The primary reason for this decision was that the AO's order had travelled beyond the scope of the notice issued under Section 148A(b). The notice had indicated that income had escaped assessment based on alleged foreign remittances of ₹6,50,84,454/-, whereas the impugned order concluded that unexplained foreign remittances amounted to ₹11,37,67,029/-. The Court found this discrepancy significant and sufficient to invalidate the order. The Court noted that while there was also a question regarding the credibility of the information provided in the Section 148A(b) notice, given the petitioner's confirmation from J&K Bank, it was not necessary to delve into those issues. The Court set aside the impugned order and clarified that the AO was not precluded from issuing a fresh notice in accordance with the law if credible information suggesting escaped assessment was available. The petition was disposed of on these terms.

What were the facts?

The assessee, M/s Independent News Service Pvt. Ltd., filed a writ petition challenging an order dated 08.04.2024 passed under Section 148A(d) of the Income Tax Act, 1961, and a consequent notice under Section 148. For AY 2017-18, the assessee initially declared an income of ₹61,35,36,200/-, later revised to ₹61,10,86,200/-. The assessment was completed under Section 143(3) on 22.11.2019. The Assessing Officer (AO) issued a notice under Section 148A(b) on 26.03.2024, alleging that foreign remittances of ₹6,50,84,454/- during AY 2017-18, collected during a survey at J&K Bank on 11.06.2019, did not tally with the assessee's bank statements, suggesting escaped income. The assessee responded on 02.04.2024, disputing the quantum and providing a J&K Bank confirmation stating the information did not pertain to them. Despite this, the AO passed the impugned order under Section 148A(d), concluding that foreign remittances totaling ₹11,37,67,029/- remained unexplained.

What were the issues?

1. Whether the impugned order dated 08.04.2024 passed under Section 148A(d) of the Income Tax Act, 1961, is sustainable when it travels beyond the scope of the notice issued under Section 148A(b) of the Act? Assessee's Contentions: The assessee argued that the AO travelled beyond the scope of the notice issued under Section 148A(b). The notice alleged escaped income due to foreign remittances of ₹6,50,84,454/-, whereas the impugned order concluded that foreign remittances amounting to ₹11,37,67,029/- remained unexplained. The assessee also contended that the information regarding remittances did not pertain to them, supported by a confirmation from J&K Bank. Revenue's Contentions: The judgment does not record specific contentions from the revenue regarding the scope of the notice or the discrepancy in amounts. However, the AO's actions, as detailed in the facts, indicate a belief that income had escaped assessment based on the survey information.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148,Section 143(3),Section 133A,Section 149(1)(b)

AI-generated summary — verify with the full judgment below

W.P.(C) 11601/2024 $~15 * IN THE HIGH COURT OF DELHI AT NEW DELHI %

Date of Decision : 02.07.2025 + W.P.(C) 11601/2024 and CM APPL. 48202/2024

M/S INDEPENDENT NEWS SERVICE PVT. LTD. ....Petitioner Through: Mr M.P. Rastogi with Mr Ram Naresh and Mr Shivam Malik, Advocates.

versus

THE ASSESSING OFFICER, CIRCLE 10(1) & ANR.

.....Respondents Through: Mr Gaurav Gupta, SSC with Mr Shivendra Singh and Mr Yojit Pareek, JSCs.

CORAM:

HON'BLE MR. JUSTICE VIBHU BAKHRU

HON'BLE MR. JUSTICE TEJAS KARIA

VIBHU BAKHRU, J. (ORAL)

1.

The petitioner has filed the present petition impugning an order dated 08.04.2024 passed under Section 148A(d) of the Income Tax Act, 1961 [the Act] as well as consequent notice issued under Section 148 of the Act.

2.

The petitioner had filed its income tax return on 18.10.2017 declaring an income of ₹61,35,36,200/- for Assessment Year [AY] 2017-18. Thereafter on 26.03.2019, the petitioner filed a revised income tax return declaring an income of ₹61,10,86,200/- for AY 2017-18. The return was picked up for scrutiny and the Assessing Officer [AO] completed the W.P.(C) 11601/2024 assessment for AY 2017-18 and passed an order dated 22.11.2019 under Section 143(3) of the Act.

3.

The AO initiated proceedings for reopening of the assessment by issuing a notice under Section 148A(b) of the Act on 26.03.2024. According to the AO, the information as set out in the Annexure to the said notice, suggested that the petitioner’s income for AY 2017-18 had escaped assessment. The annexure to the said notice indicates that on 11.05.2019, a survey under Section 133A of the Act was conducted by the Income Tax Department at the Headquarters of Jammu and Kashmir Bank [J & K Bank], M.A Road, Srinagar. During the course of the survey, information relating to inward and outward remittances was collected. It was reported that the petitioner had made foreign remittances amounting to ₹6,50,84,454/- during AY 2017-18. The AO observed that the amounts reflected in the remittances data did not tally with the amounts reflected in the bank statement of the petitioner. This, according to the AO, suggested that the petitioner’s income amounting to ₹6,50,84,454/- had escaped assessment for AY 2017-18. The annexure to the notice issued under Section 148A(b) of the Act is reproduced below:

“ANNEXURE Information has been received. in this case on Insight portal under the head High Risk CRIU/VRU, maintained by Income Tax Department in accordance with the risk management strategy formulated by the Board. As per the information available with the Department, it is submitted that a survey action u/s 133A of the Income Tax Act,1961 was conducted on J&K Bank corporate Head Quarter MA Road, Srinagar on 11.06.2019. Among various filed of formation data related to inward and outward remittances was obtained for various financial years and information related to outward remittances has been analyzed and during the analysis of W.P.(C) 11601/2024 remittances data/information it was observed that the amount reflected in the remittance data obtained from the bank does not tally with the amounts reflected in the bank statement of the assessee. Assessee company has made total foreign remittances amounting to Rs.6,50,84,454/- during the AY 2017-18. Copies of all the relevant documents are attached herewith this notice.

2.

Therefore, an amount of Rs. 6,50,84,454/- appears to have escaped assessment for the A.Y. 2017-18 which needs to be brought to tax by issuing notice u/s 148 of the Income Tax Act, 1961. Accordingly, you are hereby required to show cause as to why proceedings u/s 148/148A of the Act should not be initiated to bring to tax the above said amount of Rs. 6,50,84,454/-.

3.

In view of the above, you are hereby given an opportunity to submit your reply with all documentary evidences such as copy of ITR, Form 26AS, Balance sheet, computation of income, bank account statements etc. for the relevant AY in support of your contention within 7 days from the date of issue of this notice, failing which it will be presumed that you have nothing to say in this regard and necessary steps will be taken to initiate the proceedings as per provisions of I.T. Act. This is issued as per provisions of sec. 148A(b) of the Act.”

4.

The petitioner responded to the said notice on 02.04.2024 raising various objections including disputing the quantum of alleged remittances. The petitioner had also obtained a confirmation from the J&K Bank which indicated that the information regarding the remittances alleged in the notice issued under Section 148A(b) of the Act did not pertain to the petitioner. The petitioner also forwarded a copy of the said confirmation received from the J&K Bank along with its reply.

5.

Notwithstanding the petitioner’s response that the information received did not pertain to it, the AO has passed the impugned order dated 08.04.2024 holding that it was a fit case for issuance of a notice under W.P.(C) 11601/2024 Section 148 of the Act. The AO concluded that inward and outward foreign remittance transactions amounting to ₹11,37,67,029/- remain unexplained. The relevant extract of the impugned order is set out below:

“e) On further perusal of the information/details available on Insight Portal, it is revealed that the assessee has entered into the following foreign remittances transactions during the assessment year under consideration:

S.No. Information type Amount (Rs.) 1 Sending of foreign remittance as per Form-15CC 1,28,84,470/- 2 Receipt of remittance by a non-resident or by a foreign company as per Form-15CA 7,08,50,894/- 3 Certificate of accountant on foreign remittance as per Form-15CB 3,00,31,665/-

Total 11,37,67,029/-

It is evident from the above information that assessee has entered into inward and outward foreign remittances which was also verified from the bank statements of the assessee company for the AY 2017-18 for which assessee has not provided any explanation and the nature of inward/outward remittances made by the assessee remains unexplained. In view of above facts and after going through the material available on record, it has been concluded that inward/outward foreign remittances transactions amounting to Rs.11,37,67,029/- remains unexplained and income of Rs.11,37,67,029/- chargeable to tax pertaining to the AY 2017-18 has escaped assessment which is more than fifty lakhs rupees and the same is represented W.P.(C) 11601/2024 in the form of an entry or entries in books of accounts of the assessee. Thus, the assessee’s case is covered under provisions of section 149(1)(b) of the Act.”

6.

It is noted that the notice dated 26.03.2024 issued under Section 148A(b) of the Act did not contain any allegation regarding income amounting to ₹11,37,67,029/- escaping assessment. The only information which, according to the AO, suggested that the petitioner’s income for AY 2017-18 has escaped assessment was information to the effect that the Assessee had made foreign remittances amounting to ₹6,50,84,454/-. It is apparent that the impugned order has thus, travelled beyond the scope of the notice under Section 148A(b) of the Act.

7.

In view of the above, we are of the view that the impugned order cannot be sustained. It is also clear that there is also a question as to the credibility of the information as set out in the notice issued under Section 148A(b) of the Act considering that the petitioner has obtained confirmation from the J&K Bank regarding the remittances made by it. However, in our view, the impugned order cannot be sustained on the ground that it travels beyond the scope of the notice issued under Section 148A(b) of the Act. It is thus not necessary to examine the other issues as raised in the present petition.

8.

In view of the above, we set aside the impugned order.

9.

We clarify that in the event that the AO has any credible information which suggests that the petitioner’s income has escaped assessment for the relevant assessment year, the AO is not precluded from issuing a fresh notice albeit in accordance with law.

W.P.(C) 11601/2024 10. The petition is disposed of in the aforesaid terms. Pending application shall also stand disposed of.

VIBHU BAKHRU, J

TEJAS KARIA, J JULY 02, 2025/tr

Click here to check corrigendum, if any

More judgments on Section 148A

All 3,543 judgments and leading authorities on Section 148A →

Latest GST High Court judgments

Search GST case law →