Curtailed reply period in tax notice was invalid where no law permitted shortening the prescribed opportunity to respond.

A curtailed response period in a show cause notice was held to be unsupported where the Income-tax Act, 1961 and the rules did not authorise dispensing with the prescribed time for reply on the basis of earlier non-compliance. The court found that shortening the opportunity to respond was procedurally invalid, and the assessee's prior non-compliance did not cure that defect. The assessment order and demand dated 23 December 2022 were quashed, and the show cause notice was restored so the assessee could file a reply.

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Issues: Whether the assessment order and demand were sustainable when the show cause notice afforded a curtailed response period contrary to the binding notice period prescribed by the CBDT.

Analysis: The revenue was unable to show any provision in the Income-tax Act, 1961 or the rules authorising the CBDT to dispense with the prescribed response time on the basis of earlier non-compliance. The notice having been issued with a short reply time, the curtailment of the opportunity to respond was held to be unsupported, and the subsequent reliance on the assessee's non-compliance did not validate the procedure adopted.

Conclusion: The assessment order and demand dated 23 December 2022 were quashed and set aside, and the show cause notice was restored for reply by the assessee.

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