Income Tax Order Overturned: NRI Petitioner to Respond to New Notice Due to Flawed Calculations and Lack of Fair Hearing.

The HC set aside the impugned order under Section 147 of the Income Tax Act, 1961, due to flawed calculations and lack of opportunity for the petitioner, a Non-Resident Indian, to respond. The petitioner must reply to an additional show cause notice within two weeks, and the respondent must issue a new order post-hearing within eight weeks. No costs were awarded.

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Issues Involved:
The petitioner seeks a Writ of Certiorarified Mandamus to quash an order under Section 147 of the Income Tax Act, 1961, relating to the assessment year 2016-2017 for PAN No. GMIPS5765N, and prevent reassessment.

Details of the Judgment:

Issue 1: Jurisdiction and Assessment

The petitioner, a Non-Resident Indian residing in Singapore, asserts that all income is sourced from Singapore. Despite purchasing properties and TDS deductions, he did not file an income tax return for the relevant assessment year. The respondent issued notices based on alleged escaped income.

Issue 2: Lack of Opportunity and Flawed Basis

The petitioner argues that the respondent's orders were issued without allowing a proper response. The respondent's calculations of escaped income were flawed, as they incorrectly combined the property purchase amount and TDS payment. The petitioner was not given a chance to address new reasons introduced in the impugned order.

Judgment

The High Court found the basis for the clarification letter flawed and set aside the impugned order. The petitioner is directed to respond to an additional show cause notice within two weeks, with the respondent required to pass orders after a personal hearing within eight weeks. No costs were awarded in this matter.

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