NKC PROJECTS PRIVATE LIMITED vs. DCIT CIRCLE -16(1) NEW DELHI

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W.P.(C)/6485/2025HC DelhiDLHC01030083202515 May 2025Bench: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA2 pages
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What did the High Court hold?

The Delhi High Court held that the impugned notice dated 29.03.2025, issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2019-20, was set aside. The Court accepted the Revenue's submission that the notice was issued without following the due procedure under Section 148A of the Act. The Court clarified that the Revenue was not precluded from initiating proceedings under Section 148A of the Act and, if found fit, to issue a fresh notice under Section 148, provided it was in accordance with law and within the prescribed time limits. The ratio decidendi is that procedural compliance with Section 148A is mandatory before issuing a notice under Section 148, and failure to do so renders the notice invalid, but does not bar the Revenue from initiating fresh proceedings correctly.

What were the facts?

The petitioner, NKC Projects Private Limited, filed a writ petition before the Delhi High Court challenging a notice dated 29.03.2025 issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2019-20. The petitioner contended that the notice was issued without adhering to the mandatory procedure prescribed under Section 148A of the Act. The respondent was the DCIT Circle -16(1), New Delhi. The High Court was seized of the matter and the Revenue accepted the petitioner's contention regarding procedural non-compliance.

What were the issues?

1. Whether the notice dated 29.03.2025 issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2019-20 is invalid due to non-compliance with the procedure laid down in Section 148A of the Act? (Question of law and fact, concerning Section 148 and Section 148A of the Income Tax Act, 1961). Assessee's contention: The impugned notice was issued without following the prescribed procedure under Section 148A of the Act. Revenue's contention: The Revenue fairly stated that the impugned notice could be set aside with liberty to issue a fresh notice after following the due procedure under Section 148A of the Act.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A

AI-generated summary — verify with the full judgment below

$~92 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 6485/2025 & CM APPL. 29548-49/2025 NKC PROJECTS PRIVATE LIMITED .....Petitioner Through: Mr Prakash Sinha, Advocate. versus DCIT CIRCLE -16(1) NEW DELHI .....Respondent Through: Mr Gaurav Gupta, SSC, Mr Shivendra Singh, Mr Yojit Pareek, JSCs and Ms Prakriti Rastogi, Advocate. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MR. JUSTICE TEJAS KARIA O R D E R % 15.05.2025 1. Issue notice. Mr Gupta, the learned counsel appearing for the Revenue accepts notice. 2. The petitioner has filed the present petition, inter alia, impugning the notice dated 29.03.2025 [impugned notice] issued under Section 148 of the Income Tax Act, 1961 [the Act] in respect of the Assessment Year [AY] 2019-20. 3. It is the petitioner’s case that the impugned notice has been issued without following the procedure as prescribed under Section 148A of the Act. 4. Mr Gupta, the learned counsel for the Revenue, fairly states that the impugned notice may be set aside with liberty to the Revenue to issue fresh notice after following the due procedure under Section 148A of the Act. 5. In view of the above, the impugned notice is set aside. We, however, 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 19:58:28

clarify that the Revenue is not precluded from initiating the proceedings under Section 148A of the Act and if the Assessing Officer finds it a fit case for issuance of notice under Section 148 of the Act, to issue the same, subject to the same being in accordance with law and within the time as otherwise prescribed under the law. 6. The petition is allowed in the aforesaid observation. The pending applications are also disposed of. VIBHU BAKHRU, J TEJAS KARIA, J MAY 15, 2025 M 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 19:58:28

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