Karnataka High Court sets aside reassessment notices concerning unexplained bank deposit explanations
The Karnataka High Court has set aside reassessment notices issued to an assessee regarding explanations for unverified bank credits. The court found procedural flaws in the tax authority's approach to handling the taxpayer's submissions. This ruling provides relief against arbitrary reopening of past tax assessments.
Effective Not specified in the update
For professionals: Review pending reassessment matters involving bank deposits to identify similar procedural lapses by assessing officers. · Advise clients that tax authorities must demonstrate proper application of mind and adhere strictly to statutory safeguards rather than issuing mechanical notices for unexplained deposits.
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