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RAJIV SHAKDHER, GIRISH KATHPALIA
Prime Asset Reconstruction Company Limited – Appellant
Versus
Central Board of Direct Tax – Respondent
JUDGMENT
Rajiv Shakdher, J. (Oral)
CM APPL. 31047/2023
1. Allowed, subject to just exceptions.
W.P.(C) 8068/2023 and CM APPL. 31046/2023 [Application filed on behalf of the petitioner seeking interim relief]
2. Issue notice.
2.1. Mr Aseem Chawla, learned senior standing counsel, who appears on behalf of the respondents/revenue, accepts notice.
3. Given the directions that we propose to pass, Mr Chawla says that he does not wish to file a counter-affidavit in the matter, and he will argue the matter, based on the record presently available with the Court.
3.1. Therefore, with the consent of learned counsel for the parties, the writ petition is taken up for hearing and final disposal, at this stage itself.
4. This writ petition seeks to challenge the assessment order dated 03.05.2023 passed under Section 143(3) read with Section 147 and 144B of the Income Tax Act, 1961 [in short, "Act"].
4.1. In addition thereto, challenge is also laid to the demand notice of even date i.e., 03.05.2023 issued under Section 156 of the Act.
4.2. Besides this, the petitioner has also laid challenge to the following notices and order:
(i) Notice dated 24.05.2021 issued under Section 148A(b) of the Act.
(i
Failure to adhere to the directions in the Standard Operating Procedure (SOP) for Assessment Unit, which led to the quashing of the impugned notices and order.
The Assessing Officer must provide adequate reasoning for reassessment actions and ensure compliance with natural justice principles.
The court emphasized the importance of considering the petitioner's reply and according a personal hearing before passing an assessment order under the Income Tax Act, 1961.
The denial of personal hearing sought by the petitioner constituted a breach of principles of natural justice, leading to the setting aside of the order and notice.
The necessity of issuing a show cause notice cum draft assessment order before making any upward revision in income for assessment under the Income Tax Act, 1961.
Procedural fairness and consideration of petitioner's response in assessment proceedings under the Income Tax Act
The impugned assessment order and consequential notices were set aside as they were passed without issuance of a show cause notice-cum-draft assessment order, as required by Section 144B of the Act a....
Compliance with procedural requirements and the right to a fair hearing are essential in proceedings under the Income Tax Act, 1961.
A personal hearing is essential in tax assessment procedures to ensure administrative fairness; failure to provide one invalidates the assessment orders.
The assessment order was set aside due to breach of natural justice, specifically failure to consider the petitioner's objections filed before the order was made.
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