[S.292B Income Tax Act] Inadvertent Mistakes In Reassessment Can Be Saved But Assessment Order Overlooking Apparent Error Cannot: Delhi HC

The provision provides that no notice or assessment or any proceedings can be deemed to be invalid merely for the reason of any mistake, defect or omission in such notice, assessment or other proceedings.

A division bench of Chief Justice Devender Kumar Upadhyay and Justice Tushar Rao Gedela said while the provision would save reassessment notice which inadvertently furnished to assessee information relating to some other individual instead of his own however, the subsequent reassessment order passed by overlooking such mistake cannot be condoned.

The Assessee had challenged a notice issued to him under section 148 of the Act asking to show cause why reassessment proceedings not be initiated in connection with unexplained cash deposit of Rs.22,44,647/-.

The said notice contained details of transactions entered by some other assessee (Manisha Jain) having a different PAN and having no relation with the petitioner. Nonetheless, a reassessment order came to be passed by the Department, rejecting the objection of the Assessee.

Before the High Court, the Department claimed that information collected pertained to the petitioner only, however, while supplying the material/Information to the petitioner, an innocuous mistake was made by annexing information pertaining to some other assessee.

The Department further claimed that since the proceedings were initiated based on information collected under Section 135A of the Act, it is permitted to bypass the procedure prescribed under the provisions of section 148A of the Act and as such, providing documents to the assessee is not a mandatory requirement.

At the outset, the High Court observed that furnishing information of some other assessee was by pure inadvertence.

“The said aspect appears to be an error or mistake and neither deliberate nor wilful. On account of such error/mistake or inadvertence, no fatality can be said to attach to the issuance of the impugned notice under section 148 of the Act,” it said.

However, at the same time, it added, “the passing of the impugned order dated 03.02.2025 is absolutely unsustainable in overlooking the error apparent on the face of the record. It can be safely presumed that the authority did not apply its mind to the objections raised by the petitioner.”

Court explained that Section 292B is couched in a negative language and saves any invalidity to the return of income, assessment, notice, summons or other proceeding, merely by reason of any mistake, defect or omission. It held,

“We are of the opinion that this provision would enure to the benefit of the respondents only to the extent of excluding the error of furnishing information relating to some other individual annexed to the impugned notice under section 148 of the Act while saving the notice itself. This however, shall not save the impugned order dated 03.02.2025.”

As such, the Court quashed the impugned order and permitted the Department to rectify the impugned notice.

Appearance: For the Petitioner : Mr. Piyush Kaushik, Advocate. For the Respondents : Mr. Abhishek Maratha, SSC with Mr. Apoorv Agarwal (JSC), Mr. Parth Samwal (JSC), Ms. Nupur Sharma, Mr. Gaurav Singh, Mr. Bhanukaran Singh Jodha and Ms. Muskaan Goel, Advocates for the Revenue.

Case title: Monish Gajapati Raju Pusapati v. Assessment Unit Income Tax Department & Anr.

Citation: 2025 LiveLaw (Del) 246

Case no.: W.P.(C) 2043/2025

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