Bombay High Court Quashes Reassessment Notices Issued Merely On Basis Of Information Received From Directorate General Of GST

The Bombay High Court has quashed the reassessment notices issued merely on the basis of information received from the Directorate General of GST.

The bench of Justice K. R. Shriram and Justice Neela Gokhale has observed that the AO is only referring to the information received from the Directorate General of GST. There is absolutely nothing to indicate that he independently applied his mind to the material received or that he has analysed the response from Petitioner with the material received, which reflects total non-application of mind.

The petitioner/assessee has challenged a reassessment notice issued under Section 148A(b) of the Income Tax Act, 1961, order passed under Section 148A(d).

The AO dismissed all submissions by saying that simply furnishing copies of purchase invoices, E-way Bill, Transport Bill and payment made through banking channels are not sufficient to substantiate that the transaction made by Assessee company with EMI Transmission Ltd. is genuine. As per the AO, the Directorate General of GST, Mumbai has identified one Curzen Infraprojects Pvt. Ltd. (formerly known as Blue Sea Commodities) was generating fake/bogus invoices for passing of fraudulent Input Tax Credit (ITC) without supply of goods to various companies and EMI Transmission Ltd. was one of them, because Petitioner dealt with EMI Transmission Ltd. and the transaction is non-genuine.

The assessee contended that when the order itself exposes the hollowness in the thinking of the Assessing Officer, even granting approval under Section 151 smacks of total non-application of mind. The goods purchased from EMI Transmission Ltd. were actually supplied to third parties and we would agree with Petitioner that without purchase there can not be a sale.

The court quashed the order and remand the matter for de- novo consideration, which will be considered by the Jurisdictional Assessing Officer (JAO), who will be other than Lehandas Arjun Janbandhu, who passed the order. Consequently, the notice issued under Section 148 is also quashed and set aside.

Counsel For Petitioner: Bharat Raichandani

Counsel For Respondent: Eshaan Saroop

Case Title: KEC International Ltd. Versus UOI

Case No.: Writ Petition (L) No. 16487 Of 2023

Click Here To Read The Order