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RAJIV SHAKDHER, GIRISH KATHPALIA
Gi Staffing Services Private Limited – Appellant
Versus
Assessment Unit, National Faceless Assessmnet Centre, Delhi National E-assessmnet – Respondent
JUDGMENT
[Physical Hearing/Hybrid Hearing (as per request)]
Rajiv Shakdher, J. (Oral):
CM No. 36609/2023
1. Allowed, subject to just exceptions.
W.P.(C) 9565/2023 & CM No.36608/2023 [Application filed on behalf of the petitioner seeking interim relief]
2. Issue notice.
2.1. Mr Akshat Singh, learned standing counsel, accepts notice on behalf of the respondent/revenue.
3. Given the directions that we propose to issue, Mr Singh says that he does not wish to file a counter-affidavit and he will argue the matter based on the record presently available with the court.
3.1. Therefore, with the consent of learned counsels for the parties, the matter is taken up for hearing and final disposal at this stage itself.
4. Via this writ petition, challenge is laid to the penalty order dated 21.06.2023 passed under Section 270A of the Income Tax Act, 1961 [in short, "Act"]. Besides this, challenge is also laid to the demand notice of even date, i.e., 21.06.2023 issued under Section 156 of the Act.
4.1. The aforementioned penalty order and notice concern AY 2021-22.
5. It is not in dispute that the respondent/revenue passed the assessment order dated 26.12.2022 under Section 143(3) read with Secti
The court has the authority to set aside penalty orders and demand notices that emanate from assessment orders previously set aside, and can direct the Assessing Officer to frame a fresh assessment o....
Breach of principles of natural justice in assessment proceedings under the Income Tax Act, 1961.
The court clarified the impact of the assessment orders on penalty proceedings and set aside the impugned order based on the assessment order that was no longer in existence.
The court's decision was based on the principle that a penalty notice issued based on an assessment order that has been set aside by a coordinate Bench of the court cannot be sustained.
Procedural fairness and consideration of petitioner's response in assessment proceedings under the Income Tax Act
Grant of personal hearing is a mandatory requirement under Section 144B(6)(vii) of the Income Tax Act, and failure to provide such a hearing can result in the setting aside of the assessment order.
Compliance with natural justice principles under Section 144B is mandatory, necessitating personal hearing opportunities when variances in assessment orders are proposed.
The court emphasized that a writ action may not be a suitable remedy for matters involving contentious facts requiring thorough enquiry, and provided the petitioner with the option to file a statutor....
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 central legal point established in the judgment is the importance of adhering to principles of natural justice and setting practical timeframes for compliance with assessment notices under the In....
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