Delhi High Court Quashes Penalty Order Under BMA On Failure Of Dept. To Consider Assessee’s Email

The Delhi High Court has quashed the penalty order under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (BMA) for non-consideration of the assessee’s email.

The bench of Justice Rajiv Shakdher and Justice Tara Vitasta Ganju has observed that, as per the reply filed by the petitioner/assessee, his assertion was that the penalty proceedings should be kept in abeyance, having regard to the fact that the appeal preferred by him on the quantum levy was pending before the CIT (A).

The petitioner/assessee has challenged the penalty order dated March 29, 2023, passed by the department under Section 41 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. The petitioner/assessee has preferred an appeal against the quantum levy, which is pending before the Commissioner of Income Tax (Appeals).

The record shows that prior to the penalty order being passed, a show cause notice dated March 2, 2023, was issued under Section 41 of the B.M. Act. The assessee filed a reply on March 9, 2023, albeit via email.

The assessee contended that Section 46(4)(b) of the B.M. Act requires that the penalty order should have been passed by the officer who is in the rank of Assistant Commissioner, Deputy Commissioner, Assistant Director, or Deputy Director, albeit with the approval of the Joint Commissioner or the Joint Director.

The court directed the department to conduct a de novo exercise.

Case Title: Prateek Chitkara Versus JCIT

Citation: 2023 LiveLaw (Del) 408

Case No.: W.P.(C) 4510/2023 & CM Appl.17287/2023

Date: 12.04.2023

Counsel For Petitioner: Ruchesh Sinha

Counsel For Respondent: Ruchir Bhatia

Click Here To Read The Order