Taxpayer Gets Fresh Chance To Contest Income-Tax Reopening After Revenue Failed To Share Excel Data: Gujarat HC

The petitioner challenged an order dated 18 June 2026 under Section 148A(3) of the Income Tax Act, 1961, concerning reassessment for Assessment Year 2020–21.

The petitioner disputed the factual basis for reopening and contended, among other things, that the relevant property transaction concerned the petitioner’s HUF and that the amount had already been added to the HUF’s income.

The principal procedural objection was that the Revenue had not supplied the raw Excel database sheet and dissemination note relied upon in issuing the show-cause notice under Section 148A(1).

The Revenue acknowledged the non-supply and sought a remand to the show-cause stage so those documents could be provided and a fresh reply considered.

Section 148A(1) of the Income Tax Act, 1961, governs the show-cause process before an order under Section 148A(3); the taxpayer must be given a fair opportunity to respond to the material relied upon in that process.

Withholding relevant material relied upon by the Revenue is inconsistent with the principles of natural justice.

The Revenue referred to Champion Exim Co., Anurag Gupta v. ITO and Balesh Jain Sons HUF v. ACIT in support of remand, but the judgment does not independently analyse or apply those authorities.

The Revenue did not dispute that the raw Excel database sheet and dissemination note had not been supplied to the petitioner with the Section 148A(1) notice.

Those documents were relevant to the basis for reopening and were necessary for the petitioner to make an informed response.

The Court therefore found that their non-supply amounted to a gross violation of natural justice.

It accepted the Revenue’s proposed course of remanding the matter to the show-cause stage, rather than determining the petitioner’s substantive objections to reopening.

It remanded the matter to the stage of the Section 148A(1) notice, directed the Revenue to supply the relevant documents within two weeks of receiving the order, allowed the petitioner two weeks thereafter to reply, and directed the Revenue to pass a fresh order within 12 weeks thereafter.