Notice u/s 148A(b) giving less than seven days time to submit response quashed
In a recent judgment, the Hon’ble High Court of Karnataka has set aside show cause notice u/s 148A(b) giving less than seven days’ time to submit response
ABCAUS Case Law Citation:
ABCAUS 4085 (2024) (06) HC
In the instant case the assessee/Petitioner had filed a Writ Petition seeking issuance of writ of certiorari to quash the notice under Section 148A(b) of the Income Tax Act, 1961 (the Act). Petitioner had also sought for setting aside of the order under Section 148A(d) of the Act, notice under Section 148 of the Act, order under Section 147 read with Section 144 , order of penalty under Section 271(1)(c) of the Act and the order of penalty under Section 271F of the Act.
The primary contention of the petitioner was that notice under Section 148A(b) was issued requiring reply to be filed within five days. It was submitted that such short time afforded for reply is in violation of the statutory mandate of Section 148A(b) which requires affording of time period of not less than 7 days and due to such short time available, petitioner was not in a position to reply and all subsequent proceedings pursuant to such notice were required to be set aside on the ground of violation of principles of natural justice.
The Hon’ble High Court observed that under Section 148A(b) of the Act, the time that is afforded to make out response to the notice should not be less than 7 days as under:
“(b) provide an opportunity of being heard to the assessee, by serving upon him a notice to show cause within such time, as may be specified in the notice, being not less than seven days and but not exceeding thirty days from the date on which such notice is issued, or such time, as may be extended by him on the basis of an application in this behalf, as to why a notice under section 148 should not be issued on the basis of information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year and results of enquiry conducted, if any, as per clause (a).”
The Hon’ble High Court further observed that admittedly, in the present case, notice issued calling for reply provided only five days for submission of the reply. . In light of the same, the contention of prejudice having occurred by such short time is to be accepted in light of breach of time period prescribed under Section 148A(b) which provides that a period of not less than 7 days to be afforded.
Accordingly, the Hon’ble High Court set aside the impugned notice u/s 148A(b) and all consequential orders arising out of proceedings pursuant thereto. Liberty was reserved for the
Revenue to take action in accordance with law as is permissible as regards the subject matter of notice under Section 148A(b) of the Act.
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