Himachal Pradesh HC sets aside Demand for Income Tax of Rs. 2.73 crores, as Company’s Account Properly Reflects Transaction

In a recent case before the Himachal Pradesh High Court, a two-member bench comprising Justice Vivek Singh Thakkur and Justice Sandeep Sharma overturned an Income Tax demand of Rs. 2.73 crores against a company. The court found that the transactions in question had been properly accounted for in the company's books, including the profit and loss account and balance sheet. The petitioner had contested the assessment and subsequent notice, arguing that their submissions and a supplementary reply had not been duly considered by the tax authorities. The court agreed, stating that the authorities failed to provide a reasoned order justifying the assessment. Consequently, the court quashed the order and directed the tax authority to reevaluate the matter, emphasizing a thorough consideration of all submissions and documents provided by the petitioner.