Court Dismisses Challenge to Assessment Order; No Breach of Procedure Found, Seek Statutory Appeal for Remedy.

The HC dismissed the writ petition challenging the assessment order due to alleged non-compliance with the Digital Evidence Investigation Manual. The court found no substantial breach of procedure or principles of natural justice, as the petitioner failed to identify specific violations during proceedings. The court advised the petitioner to seek remedy through a statutory appeal, which could be filed within ten days. The appellate authority was instructed to consider the appeal on its merits without any time limitation constraints. No costs were awarded, and all related miscellaneous petitions were closed.

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Issues:
Challenge to assessment order based on digital evidence collection procedure.

Analysis:
The judgment concerns a writ petition challenging an assessment order dated 30.03.2024 primarily on the grounds of non-compliance with the Digital Evidence Investigation Manual issued by the Central Board of Direct Taxes. The petitioner's assessment stemmed from a search and seizure operation related to M/s. Integrated Services Private Limited, leading to the issuance of notices under Sections 148 and 142(1) of the Income Tax Act, 1961. The petitioner contended that the digital evidence collection did not adhere to the manual, citing the necessity for the sanctioning authority to ensure compliance with the manual. The petitioner relied on a previous judgment emphasizing the manual's binding nature on Income Tax Department officers. The absence of details in the assessment order regarding digital evidence collection and chain of custody maintenance, as per the manual and Section 65B of the Indian Evidence Act, was highlighted as grounds for interference.

The respondent, represented by learned senior standing counsel, argued that natural justice principles were followed, providing the petitioner with opportunities to respond and be heard before the assessment order issuance. It was asserted that the order was based on evidence appraisal, with no justification for interference under Article 226 of the Constitution of India. Despite the petitioner's claims of non-compliance with the manual and Section 65B, specific instances of such breaches were not identified, nor were these objections raised during the assessment proceedings. Consequently, the court deemed the case inappropriate for discretionary jurisdiction under Article 226, suggesting that reappraisal of evidence should be pursued through the appellate authority.

The court disposed of the writ petition by allowing the petitioner to file a statutory appeal within ten days. The appellate authority was directed to consider the appeal on merits without limitation considerations. No costs were awarded, and connected miscellaneous petitions were closed as a result of the judgment.

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