M/S. Nanda Feeds Private Limited Vs the Assistant Commissioner of Income Tax

THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO (A) QUASH AS FAR AS THE PETITIONER IS CONCERNED BY AN APPROPRIATE WRIT OR ORDER IN THE NATURE OF CERTIORARI OR OTHERWISE, THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) DATED 12.03.2026 FOR THE AY 2024-25 BEARING DIN ITBA/AST/S/143(3)/2025-26/1087270765(1) ENCLOSED AS ANNEXURE-A BY RESPONDENT AND ETC.

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THIS PETITION COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV

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ORAL ORDER

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Petitioner has called in question the validity of the Assessment Order passed under Section 143(3) of the Income Tax Act, 1961 (for short 'the Act') for the assessment year 2024-25. Petitioner has also sought for setting aside of the ancillary proceedings pursuant to the order of assessment.

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Sri. K. K. Chythanya, learned Senior Counsel appearing for the petitioner submits that petitioner has assailed the validity of the order on the ground of violation of principles of natural justice and non-following of circulars which mandate that proposed addition is required

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to be quantified and petitioner be put on notice. It is further submitted that petitioner ought to be called upon with specific information required by the department, before the Authority proceeds to adjudicate, as petitioner would then be in a position to meet the grounds sought to be raised and which could be taken note of while passing of the assessment order.

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It is pointed out that the authorities concerned had issued notices regarding freight inward expenses by notice dated 06.02.2026. Insofar as such aspect is concerned, it is submitted that petitioner had furnished sample invoices and had specified in their reply that they would furnish other details as may be required. However, in absence of any such further query by the department, petitioner has now been placed in a position where adverse inference is drawn and adjudication is completed.

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It is submitted that if petitioner was asked in the query to produce the required invoices and other

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details regarding freight invoices, they would have produced and in the absence of such query, petitioner has not furnished entirety of the documents evidencing freight inward expenses.

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Insofar as the query regarding rearing charges, petitioner has taken a stand that the farmers did not issue invoices and in the absence of which and in light of the practice followed by farmers wherein the farmers did not maintain formal accounting records nor issued tax invoices, petitioner had placed internal documentation in the form of farmer-wise and cycle-wise Rearing Charges Reports; details of birds placed and birds lifted; performance and computation sheets used for determining rearing charges; payment summaries; Bank statements evidencing payments made through banking channels. It is further submitted that in each of the responses made, the petitioner had offered to furnish further information required. However, it is pointed out that in the assessment order that the Authority has proceeded to adjudicate on

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both heads of rearing charges as well as freight charges without complete documents being available.

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Learned Senior Counsel would further contend

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that any proposed addition ought to be preceded by its quantification and petitioner ought to be given an opportunity to take their views regarding the same before the authority would proceed. It is further submitted that personal hearing ought to have been afforded in which event, petitioner would have clarified the alleged discrepancies as noticed by the authority.

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Sri. Dilip M, learned counsel appearing for the respondent would submit that the Authority has concluded the proceedings on the material available.

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Perused the impugned assessment order. No doubt, the authority has referred to the responses of the petitioner under the head of rearing charges. However, the response of the petitioner is treated to be general explanation with no documentary evidence being

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produced. The authority has then proceeded to complete the adjudication process observing that there was no primary evidence as in the form of Bills, Vouchers or third party confirmation which has been submitted.

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Insofar as freight charges, the observation of the authority is to the effect that no primary evidence has been produced and no transporter details or confirmations have been furnished. In light of the stand of the petitioner, it ought to be noticed that insofar as freight expenses it is asserted by the petitioner that what they have produced were only sample invoices and would now produce invoices regarding the freight expenses as are available with the petitioner. Insofar as rearing charges, it is submitted that the petitioner had taken a specific stand that the practice of the farmers involved in rearing was that there was no formal accounting books maintained nor

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invoices furnished and accordingly the petitioner

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themselves had given all details to demonstrate the costs of rearing.

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It is further submitted that if an opportunity of personal hearing is given, petitioner would demonstrate from the records maintained at their end as regards the head of rearing charges. It is further submitted that they would also make their stand clear of manner of ascertaining costs regarding rearing in the absence of formal records maintained.

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It is also necessary to observe that when the authority seeks to make an addition, it would be appropriate that the authority quantify the proposed addition to enable the petitioner to take their stand. In light of the factual dense details on the basis of which adjudication is to be completed, petitioner to be afforded an opportunity of personal hearing.

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