High Court quashes Section 148A(d) notice, orders fresh assessment. Emphasis on evidence review.

The High Court set aside the notice and order issued under Section 148A(d) of the Income Tax Act, directing a fresh assessment by the Assessing Officer. The court emphasized the need for a thorough consideration of the petitioner's evidence and granted the petitioner an opportunity to address any additional material submitted by the AO.

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Issues:
The judgment involves a challenge against a notice issued under Section 148A(b) of the Income Tax Act, 1961, as well as an order passed under Section 148A(d) of the Act and a consequential notice issued under Section 148 of the Act.

Section 148A(b) Notice Challenge:
The petitioner challenged a notice dated 21.03.2022 issued under Section 148A(b) of the Income Tax Act, 1961. The respondent alleged that the petitioner benefitted from accommodation entries provided by specific entities, with a cumulative value of Rs.2,05,90,186. The petitioner denied taking accommodation entries, claiming it purchased and exported readymade garments. The petitioner submitted various documents, including GSTR returns, to support its case. The court noted that the Assessing Officer did not adequately consider the evidence provided by the petitioner. The court set aside the order and notice issued under Section 148A(d) and directed a fresh examination by the AO based on the documents submitted by the petitioner.

Section 148A(d) Order Challenge:
The petitioner also challenged an order dated 28.03.2022 passed under Section 148A(d) of the Act. The AO's primary basis for action was the inability to locate one of the entities mentioned in the case. However, the court emphasized that the AO failed to establish the petitioner's claim of receiving supplies from the entities was false. The court directed the AO to conduct a fresh examination, considering the documents provided by the petitioner and granting a personal hearing to the petitioner's representative.

Conclusion:
The High Court disposed of the writ petition, setting aside the order and notice issued under Section 148A(d) and directing a reevaluation by the Assessing Officer. The court emphasized the importance of considering the evidence presented by the petitioner and providing an opportunity for the petitioner to respond to any further material furnished by the AO.

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