Brett Lee Granted Tax Relief by ITAT Delhi
In a significant ruling, the Delhi bench of the Income Tax Appellate Tribunal (ITAT) has granted relief to former Australian cricketer Brett Lee in a tax dispute. The case involved an income tax demand of ₹3 crore for endorsement fees received by Lee during the assessment year 2013-14 from three Indian companies: Reebok India Company, Castrol India Limited, and Knight Riders Sports Private Ltd.
The crux of the issue lies in the timing and manner of serving the tax notice under Section 148 of the Income Tax Act. The ITAT noted that the notice was required to be served on or before March 31, 2021. However, the Income Tax Department sent the notice a day before this deadline to an incorrect email address, resulting in it bouncing back. This mishap led the tribunal to rule that the notice was not validly served under the Act.
“The assessment order passed has to be declared as invalid. Accordingly, we quash the assessment order,” stated the ITAT bench comprising Saktijit Dey and Brajesh Kumar Singh. The Assessing Officer (AO) had argued that the notice generated by the Income Tax Business Application (ITBA) on March 30, 2021, was duly served. However, Lee’s legal counsel countered that the notice was sent to an unrecognized email address and not the one registered by Lee.
Lee’s counsel highlighted that the cricketer registered his email ID on the ITBA portal only on March 31, 2022, which was a year after the notice was supposedly issued. The ITAT concurred with this argument, stating that the date on which Lee could have first viewed the notice on the e-filing portal should be considered the actual date of issuance.
This decision underscores the importance of proper procedural compliance in the issuance of tax notices. The ruling provides significant relief to Brett Lee, nullifying the assessment order and the consequent tax demand.
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