Court quashes order under Income-tax Act due to natural justice violation.

The court set aside and quashed the order passed under section 264 of the Income-tax Act, finding a violation of natural justice as the verification report was not provided to the petitioner. It was established that the petitioner had filed a genuine revised return, contrary to the assertion in the verification report. Consequently, all consequential proceedings were annulled, and the Assistant Commissioner was instructed to reassess, considering the revised return. The writ petition was granted without costs, and parties were entitled to receive a certified copy of the judgment promptly upon request.

---

---

Issues:
Challenge to legality and validity of orders under Income-tax Act, 1961 - Violation of natural justice - Authenticity of revised return.

Analysis:
The petitioner challenged the order passed by the Commissioner of Income-tax and the assessment order by the Assistant Commissioner, along with related notices for recovery of income-tax. The petitioner, engaged in mechanical fabrication business, deducted income tax at source from payments made to sub-contractors as required by law. An error in the annual TDS return led to discrepancies in the assessment, resulting in a notice under section 148 for certain deductions. The petitioner filed an application under section 264 of the Act against the assessment order, claiming the revised return was authentic. The verification report was not provided to the petitioner, leading to a violation of natural justice. The petitioner contended that the revised return filed was not considered in the assessment process.

The court noted that the verification report was not furnished to the petitioner, depriving her of the opportunity to address its contents, thereby violating natural justice. Regarding the revised return, it was found that the petitioner had indeed filed it, which was not disputed in the affidavit-in-opposition. The court held that the finding that the revised return was bogus based on the verification report was unacceptable. Consequently, the order passed under section 264 of the Act was set aside and quashed, along with all consequential proceedings. The Assistant Commissioner was directed to reconsider the assessment order for the relevant year, taking into account the revised return filed by the petitioner.

In conclusion, the writ petition was allowed, and no costs were imposed. The court ordered urgent provision of a certified copy of the judgment to the parties upon request.

---