The HC quashed an assessment order under s143(3) and penalty ...

Insufficient Time to Respond to Show Cause Notice Leads to Quashing of Assessment and Penalty Orders Under s143(3), s270A, and s271AAD(1)(i)

March 20, 2025

Case Laws     Income Tax     HC

The HC quashed an assessment order under s143(3) and penalty orders under s270A and s271AAD(1)(i) due to violation of natural justice principles. The petitioner received Annexure I to a show cause notice only two days before the scheduled hearing, insufficient time to respond adequately. Though the assessment was hurried to avoid statutory limitation under s153B, the court found procedural deficiencies warranting intervention. The court balanced interests by remitting the case back to the assessing officer for fresh consideration on merits. The court clarified that cross-examination of suppliers is only permissible when their statements are relied upon, and employee statements constitute admissions unless promptly retracted. The writ petition was allowed.

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