Delhi High Court Quashes Income Tax Reassessment for Adding Fresh Allegations Not Mentioned in Original Notice

The Delhi High Court has set aside a reassessment order issued by the Income Tax Department against a prominent media house, holding that the assessing officer (AO) had acted beyond the legal limits of the notice served under Section 148A(b) of the Income Tax Act, 1961.

The bench of Justice Vibhu Bakhru and Justice Tejas Karia ruled that thereassessment order dated April 8, 2024, against the petitioner—M/s Independent News Service Pvt. Ltd.—could not be sustained in law as it introduced new grounds not mentioned in the original notice.

The case pertains to the assessment year (AY) 2017-18, for which the petitioner had originally filed an income tax return declaring ₹61.35 crore, later revised to ₹61.10 crore. The return was scrutinised, and a final assessment was passed in 2019 under Section 143(3).

However, in March 2024, the department sought to reopen the case based on a 2019 survey at the Jammu & Kashmir Bank headquarters in Srinagar. The Income Tax Department alleged that foreign remittances amounting to ₹6.5 crore made by the petitioner had not been properly accounted for.

The petitioner challenged the reassessment notice, producing a confirmation letter from the J&K Bank which clarified that the remittance data did not pertain to the petitioner.

Despite the petitioner’s response, the AO proceeded to pass a reassessment order citing a much higher amount—₹11.37 crore—as unexplained foreign remittances.

The court while noting that the final order expanded the scope far beyond the original notice and introduced new allegations that were never communicated to the petitioner.

“This Court finds that the impugned order travels beyond the scope of the notice under Section 148A(b) and thus cannot be sustained,” the court observed.

The court further remarked that even the foundational information supporting the reassessment appeared questionable, especially since the petitioner had provided documentary proof that contradicted the department's claims.

The court while setting aside the reassessment order, clarified that if the department has credible and valid information in the future, it is not precluded from issuing a fresh notice under the law.

“The AO may issue a fresh notice in accordance with law if credible information is indeed available,” the judgment stated.

Case Details

Case Title: Independent News Service Pvt. Ltd. Versus The Assessing Officer, Circle 10(1) & Anr.

Case No.: W.P.(C) 11601/2024 and CM APPL. 48202/2024

Date: 02.07.2025

Counsel For Petitioner: M.P. Rastogi

Counsel For Respondent: Gaurav Gupta, SSC