Assessment orders under the Income Tax Act must comply with prior court directives and provide opportunity for objection; non-compliance renders them invalid.

JUDGMENT :

SMITA DAS DE, J.

1. The instant writ Petition arises out of the reassessment proceedings for the Assessment Year 2010-11 under the provisions of Section 147/143(3) read with section 148 of the Income Tax Act, 1961 (hereinafter referred to as the said Act).

2. Apropo, the facts of the case is that the assessee filed its return of income to the tune of Rs. 29,56,452/- for the Assessment Year 2010- 11 on September 10, 2010. The case was accordingly processed under Section 143 (1) of the said Act. Subsequently the information was received from the Directorate of Income Tax (Intelligence and Criminal Investigation) Kolkata (herein after referred to as DIT (INV) for the sake of brevity and convenience) about booking loss of Rs. 14,44,92,868/- by the assessee through client code modification. The said fact was brought to the notice of the said DIT (INV) during the spot verification and inspection conducted under Section 131(1A) of the said Act. The case was reopened by issuing notice under Section 148 of the said Act on March 23, 2015 after recording the reasons for reopening. The said reasons were communicated to the assessee upon request made for the same.

3. The notice under Section 143 (2) of the said Act was issued accordingly on March 23, 2016. The petitioner raised an objection on March 12, 2016 against the issuance of the notice under Section 148 of the said Act but the same remained unconsidered. Being aggrieved by the actions of the respondents in not considering the objection, the petitioner had filed a Writ Petition on March 22, 2016 being No. W.P. 282 of 2016, for a declaration that the notice dated March 23, 2015 issued under Section 148 of the said Act is illegal and liable to be set aside. In the mean time on March 30, 2016 the respondent authorities passed the Assessment Order under Section 147 /143(3) with an observation that:

“2.2. Meanwhile the assessee has filed a writ application before the Hon’ble High Court, Kolkata on 23.03.2016 vide petition dated 22.03.2016 and requested not to pass any order u/s. 143(3)/147 of I.T. Act, 1961 till the disposal of Writ Petition finally by the Hon’ble Justice. A written request has also been received via email from Bajrang Manot, Advocate on Record of the assessee, on 29.03.2016 vide his written request dated 29.03.2016. The request of the assessee and his Advocate has been considered but can’t be acceded to due to the limitation of time and in absence of injunction or stay order specifically in this case from the Hon’ble Justice of Calcutta High Court. However, it is respectfully submitted that the present order u/s. 147/143(3) of I.T. Act, 1961 shall be governed by the direction of Hon’ble Justice of Calcutta High Court at any point of time in future and will be the subject matter of all directives of the Hon’ble Court.”

4. Thereafter on April 05, 2016 the writ petition pending before this Hon’ble High Court was finally disposed of with a direction:-

“The concerned Deputy Commissioner to deal with the grounds indicated in the petitioner’s letter of March 2, 2016 by a reasoned response to be communicated to the petitioner within four weeks from date. Upon the failure of such communication within the time indicated, the notice under Section 148 of the said Act will stand set aside. Upon the communication being made within the time permitted, it will be open to the petitioner to take such appropriate steps as may be available to it.”

5. The order o