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2023 (9) TMI 757 - HC - Income TaxNotice issued u/s 271D - violation of Section 269SS - specific case of the petitioner is that the notice is vague and that already a regular Assessment order has been passed wherein, proposals were made for imposing penalty u/s 270A, 271A, 271B and 271AAC - HELD THAT - Show cause proceeding cannot be scuttled by filing a writ petition, as it is not without jurisdiction. It is open for the petitioner to reply to the Show Cause Notice and defend himself. P rima facie, it appears that the petitioner has violated provisions of Section 269SS of the Income Tax Act, 1961 and is therefore required to answer to the proposal contained the impugned Show Cause Notice dated 09.08.2023. Therefore, this writ petition is liable to be dismissed. The petitioner shall file such reply within one week from the date of receipt of a copy of this order. The respondent shall therefore dispose the impugned Show Cause Notice dated 09.08.2023 on merits and in accordance with law without getting influenced by any of the observations contained herein in this order within reasonable period.
Issues:
The petitioner challenged the impugned notice issued under Section 271D of the Income Tax Act, 1961 for violation of Section 269SS of the Income Tax Act, 1961. Judgment Details: The petitioner argued that the notice was vague and that a regular Assessment order had already been passed on 31.12.2019, proposing penalties under various sections of the Income Tax Act, 1961. The petitioner is currently in appeal against the Assessment order dated 31.12.2019. Subsequently, the Assessment order was revised invoking Section 148 of the Income Tax Act, 1961, and a new Assessment order was issued on 20.03.2022, without any proposal for imposing penalties. The petitioner contended that the vague notice questioning the imposition of penalty under section 271D lacked merit. The learned counsel for the petitioner cited several decisions in support of their case, including Commissioner of Income Tax Vs. Jaya Lakshmi Rice Mills, Commissioner of Income Tax Vs. Standard Brands, Diwan Enterprises Vs. Commissioner of Income Tax, Director of Income-Tax Vs. Young Men Christian Association, and Srinivasa Reddy Reddeppagari Vs. Joint Commissioner of Income Tax. After considering the arguments from both sides, the court held that show cause proceedings cannot be avoided by filing a writ petition, as it is not without jurisdiction. The petitioner was directed to reply to the Show Cause Notice within one week and defend themselves. The court noted that prima facie, the petitioner had violated provisions of Section 269SS of the Income Tax Act, 1961, and therefore must respond to the proposal in the impugned Show Cause Notice dated 09.08.2023. The writ petition was dismissed, and the petitioner was instructed to file a reply promptly. The respondent was directed to dispose of the Show Cause Notice on its merits and in accordance with the law without being influenced by any observations in the order. The writ petition was dismissed with no costs, and connected writ miscellaneous petitions were closed.
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