Natural justice breach: denial of evidence and cross examination rights requires setting aside assessment steps and remand.

Failure to furnish requested documents and denial of opportunity to cross examine adverse deponents were held to violate principles of natural justice in income tax proceedings under Section 148A(d) and related notice issuance; because the record contained no rebuttal to the petitioner's allegation, the appropriate remedy was to set aside the impugned order and remit the matter for fresh consideration. The assessing officer must provide the requested documents and opportunity to test adverse evidence and conclude assessment within twelve weeks of communication of the order.

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Issues: Whether the impugned order dated 13 April 2023 under Section 148A(d) of the Income-tax Act, 1961 and the subsequent notice under Section 148 of the Income-tax Act, 1961 should be set aside on the ground that principles of natural justice were violated by not providing the petitioner copies of evidence/documents and by not affording an opportunity to cross-examine adverse deponents.

Analysis: The petition challenges the assessing authority's action on the specific procedural ground that the petitioner was not furnished copies of documents/evidence and was denied the opportunity to cross-examine persons who had given statements adverse to the petitioner, despite a written request. The Court examined the record and submissions and found no material to rebut the petitioner's allegation that the requested documents and opportunity to cross-examine were not provided. Given the centrality of notice and opportunity to test adverse evidence to the principles of natural justice in income-tax proceedings under Section 148A(d) and the issuance of notices under Section 148, the appropriate remedy when such procedural infirmity is established is to set aside the impugned order and remit the matter for fresh consideration after affording the assessee the requested procedural rights.

Conclusion: The impugned order under Section 148A(d) of the Income-tax Act, 1961 and the subsequent notice under Section 148 of the Income-tax Act, 1961 are set aside and the matter is remanded to the assessing officer to consider the petitioner's requests for documents and opportunity to cross-examine in accordance with law and principles of natural justice; the assessing officer shall conclude the proceedings and pass final assessment within twelve weeks from communication of this order.

Ratio Decidendi: Where an assessee is not provided copies of evidence or an opportunity to cross-examine adverse deponents as requested, such procedural denial of the principles of natural justice warrants setting aside the impugned order and remanding the matter for fresh adjudication after affording the required fair hearing.

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