Top Stories Delhi HC upholds Income Tax Demand Order u/s 148(A)(d) against Agriculturist for Deposit of Rs. 53.55 Lakhs in Bank Account, directs to pursue Statutory Remedy [Read Order] It was argued by the petitioner that the notice was never served upon him. By Manu Sharma – On April 4, 2024 8:30 pm – 3 mins read The Delhi High Court had upheld the Income Tax Demand Order issued under Section 148(A)(D) of the Income Tax Act, 1961 against an individual for deposit of Rs. 53.55 Lakh in Bank Account.

The petitioner is an individual who claims to be an agriculturist and had not filed any income tax return for the AY 2016-17 on the pretext that income earned from agriculture is not chargeable to tax. According to the petitioner, in the absence of any service of the show cause notice, no reply could be filed and therefore, the impugned order under Section 148(A)(d) of the Act is liable to be set aside, as it stood against the principles of natural justice. On 15 March 2023, notice under Section 148A(b) of the Act is stated to have been issued to the petitioner asserting therein that, on a perusal of the information as reported on Insight Portal of the Revenue, during financial year 2015-16 (relevant AY 2016-17), the petitioner had entered into a transaction of cash deposit amounting to INR 53,55,000/- in his savings account. It is argued by the petitioner that the aforesaid notice was never served upon him. Since there was no reply to the said show cause notice, an order under Section 148A(d) of the Act came to be passed on 27 March 2023. Simultaneously, notice under Section 148A of the Act was also issued on the same date. The AO commented that, “It is observed from the bank statement of the assessee has deposited cash amounting to Rs. 53,55,000/- which is unexplained money. Hence, it requires to be verified and examined.”

During the course of arguments, the counsel for the petitioner reiterated the submissions made in the writ petition and submitted that the notice under Section 148A(b) of the Act ought to have been served on the petitioner’s registered e-mail with the Income Tax Department, and since the Department has not been able to place on record the proof of service through e-mail, the impugned order stands vitiated and nullified. The Revenue filed an affidavit stating that the notice under Section 148A(b) of the Act was duly served upon the petitioner vide speed post dated 15 March 2023 on the address, as was available with the Revenue. The tracking report of the said speed post indicates that the notice was duly delivered to the petitioner on 17 March 2023. In the instant case, a careful perusal of the averments made by the petitioner manifests that the petitioner seems to have ingeniously given an impression about violation of the principles of natural justice. Additionally, it was found that there is no rejoinder to the averments made in the affidavit by the Revenue.

“The requirement of natural justice stood fulfilled once the notice was served at the admitted address of the petitioner and the Revenue cannot be faulted in that case, irrespective of the consequences that flow therefrom”, the bench observed. The Bench of Justice Purushaindra Kumar Kaurav and Justice Yashwant Verma held that, “we do not find any reason, much less a cogent reason, to entertain the instant writ petition or to annul the order passed under Section 148A(1)(d) of the Act. However, we leave it open to the petitioner to take appropriate recourse in accordance with law against the order of assessment passed during the pendency of the instant petition, if so advised.”