Consequent to order passed by Allahabad High Court passing severe strictures and proposing to levy exemplary cost of Rs 50 lakhs in a writ challenging reopening of assessment on wrong facts, CBDT today ( 22nd August,2022 ) has issued instructions to all its officers that for initiating proceedings under Section 148/147 of the Act, any information available on data-base/portal of the Department should be verified before drawing any adverse inference against the taxpayers.

The instructions further states that *“It is not out of place to mention here that the information made available data uploaded by the reporting entities may not be fully accurate due to interalia, error of human nature technical nature, etc.”* This is an admission by the CBDT that the information uploaded and on the basis of which assessment have been or are proposed to be reopened by the assessing offer was /may not be correct.

Consequently CBDT has directed its officers to carry out due verification and also to give opportunity of being heard to the taxpayer before initiating proceedings under Section 148/147 of the Act.

Further the supervisory authorities have been advised to keep an effective supervision so as to ensure that all extent Instructions/Guidelines/Circulars/SOPs are duly followed by the
Assessing Officers in their charge.