Delhi HC Upholds Validity of Reassessment Notice Despite Limited Disclosure of Material

The petitioner, M/s MHJ Metaltechs Pvt. Ltd., challenged a notice issued under Section 148A(b) of the Income-tax Act alleging bogus purchases of Rs. 46,00,460 and fictitious sales of Rs. 89.86 crore.

The grievance was that the notice merely made a passing reference to these figures without furnishing transaction-wise details or supporting material. According to the petitioner, the reassessment proceedings were nothing but a fishing and roving inquiry, initiated without proper disclosure of material.

Main Issue: Whether a reassessment notice under Section 148A(b) is invalid for want of jurisdiction merely because the Assessing Officer has not supplied copies of all underlying material or detailed transaction-wise information at the notice stage.

HC’s Decision: The Hon’ble High Court dismissed the writ petition, holding that the Assessing Officer had complied with the statutory requirement of supplying “information” suggesting escapement of income. The Court drew a clear distinction between “information” and the entire “material available on record”, observing that the law does not require furnishing copies of all documents at the stage of issuing a notice under Section 148A(b). It held that a precise narration of the basis on which the Assessing Officer formed a prima facie view is sufficient.

The Court cautioned that insisting on disclosure of complete material at the threshold would unduly prolong proceedings and enable assessees to tailor defences prematurely. Finding no jurisdictional error in the initiation of reassessment, the Court upheld the impugned notice and dismissed the petition.

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