WISEMAN KNITFAB PRIVATE LIMITED vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 27, DELHI

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W.P.(C)/4857/2025HC DelhiDLHC01021097202521 April 2025Bench: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court agreed with the course of action suggested by the Revenue. It set aside the impugned order dated 06.03.2025. The matter was remanded to the Assessing Officer (AO) to consider the petitioner's response afresh. The AO was directed to pass a fresh assessment order after affording the petitioner an opportunity to be heard. The court did not decide on the merits of the additions proposed under Sections 68 and 69C, as the primary issue was the procedural violation. The petition was disposed of in terms of this direction.

What were the facts?

The petitioner, Wiseman Knitfab Private Limited, filed a writ petition challenging an order dated 06.03.2025 passed under Section 147 read with Section 144 of the Income Tax Act, 1961. The petitioner alleged violation of natural justice. The Assessing Officer (AO) had issued a notice under Section 148 on 22.03.2024 for reopening the assessment for Assessment Year 2020-2021, based on material seized during a search of the Galaxy Group. The petitioner filed its return and responded to notices under Sections 143(2) and 142(1). A show cause notice proposing additions of Rs.1,63,00,000/- under Section 68 and Rs.4,89,000/- under Section 69C was issued on 03.02.2025. The petitioner filed its response on 08.03.2025, but the AO passed the impugned order on 06.03.2025, which the petitioner claims was actually passed on 16.03.2025.

What were the issues?

1. Whether the order passed under Section 147 read with Section 144 of the Income Tax Act, 1961, was in violation of the principles of natural justice, specifically concerning the consideration of the petitioner's response to the show cause notice. Assessee's Contentions: The petitioner contended that the impugned order was passed in violation of the principles of natural justice. It argued that its response to the show cause notice, filed on 08.03.2025, was disregarded by the AO when passing the order dated 06.03.2025. The petitioner also sought a copy of the evidence and statements relied upon by the AO, which were obtained from a search of the Galaxy Group. Revenue's Contentions: The Revenue, through its counsel, did not contest the petitioner's claim regarding the procedural irregularity. Instead, it conceded that the impugned order could be set aside and the AO directed to pass a fresh order after considering the petitioner's response.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 148,Section 143(2),Section 142(1),Section 68,Section 69C

AI-generated summary — verify with the full judgment below

$~121 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 4857/2025 CM APPL. 22358/2025

WISEMAN KNITFAB PRIVATE LIMITED .....Petitioner Through: Ms. Ananya Kapoor, Mr. Utkarsha Kumar Gupta, Mr. Sumit Lalchandani, Advocates.

versus DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 27, DELHI

.....Respondent Through: Mr. Gaurav Gupta, SSC, Mr. Shivendra Singh, JSC, Mr. Yojit Pareek, Advocates.

CORAM:

HON'BLE MR. JUSTICE VIBHU BAKHRU

HON'BLE MR. JUSTICE TEJAS KARIA

O R D E R %

21.04.2025 1. The petitioner has filed the present petition impugning an Order dated 06.03.2025 passed under Section 147 of the Act read with Section 144 of the Income Tax Act, 1961 [the Act]. The petitioner contends that the said order has been passed in violation of the principles of natural justice. The notice under Section 148 of the Act was issued by the Assessing officer [AO] on 22.03.2024 for reopening the assessment for the Assessment Year 2020-2021. 2. In compliance of the said notice, the petitioner filed its return of income on 18.04.2024. Thereafter, the AO issued notices under Section 143(2) of the Act as well as under Section 142(1) of the Act. The petitioner claims that it responded to the said notices and also requested the AO to provide a copy of the evidence/material seized as well as statements recorded during the search conduced in the premises belonging to the persons of the Galaxy Group as the notice under Section 148 of the Act was This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 23:06:15

premised on the material found during the said search. 3. On 03.02.2025, a show cause notice was issued by the AO proposing to make an addition of Rs.1,63,00,000/- under Section 68 of the Act and also an addition of Rs.4,89,000/- under Section 69C of the Act. On 10.02.2025, the petitioner requested for some time to file its response to the said notice and thereafter filed the same on 08.03.2025. However, the AO proceeded to pass the impugned order, disregarding the response filed by the petitioner. The said order is dated 06.03.2025, however, the petitioner alleges that the same was passed on 16.03.2025. 4. Mr. Gupta, learned counsel appearing on behalf of the Revenue, states that without getting into the controversy as sought to be raised by the petitioner, the impugned order may be set aside and the AO shall pass the order afresh after considering the response furnished by the petitioner. 5. The said course commends to us. Accordingly, we set aside the impugned order and remand the matter to AO to consider it afresh. The AO shall consider the response furnished by the petitioner and pass a fresh assessment order after affording the petitioner an opportunity to be heard. 6. The petition is disposed of in the aforesaid terms. 7. All the pending application(s) also stand disposed of.

VIBHU BAKHRU, J

TEJAS KARIA, J APRIL 21, 2025 KG

Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 23:06:15

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