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DELHI HIGH COURT
MANMOHAN, NAVIN CHAWLA
Clarks Future Footwear Private Limited – Appellant
Versus
National Faceless Assessment Centre – Respondent
| Table of Content |
|---|
| 1. challenge to draft assessment order (Para 1) |
| 2. violation of natural justice and assessment process (Para 2 , 3) |
| 3. response from the respondents and timelines (Para 4 , 5) |
| 4. quashing of draft assessment order due to violations (Para 6) |
| 5. disposal of the writ petition with directions (Para 7) |
JUDGMENT
Manmohan, J. (Oral)--Present writ petition has been filed challenging the impugned draft assessment order dated 29th August 2021 passed by the Respondents under Section 144C(1) of the Income Tax Act, 1961 [hereinafter referred to as the `Act'] as well as the show cause notice dated 27th August 2021.
2. Learned counsel for the Petitioner states that the impugned draft assessment order and show cause notice are non est since the mandatory provision, namely, Section 144B has not been complied with by the Respondents and the same is also violative of the principles of natural justice. He states that the Respondents, vide the show cause notice dated 27th August, 2021 and draft assessment order dated 29th August 2021, proposed to assess the income of the Petitioner at Rs.48,07,37,965/- as against the returned loss of Rs.2,42,15,980/- declared by the Petitioner.
3. Learne
Assessment orders under the Income Tax Act must comply with mandatory procedural requirements, including issuing a show-cause notice and draft assessment order, to uphold principles of natural justic....
The court held that an assessment order is invalid if not preceded by a show cause notice, as required by Section 144B of the Income Tax Act.
Violation of the principle of natural justice in the assessment process warrants setting aside the assessment order and remanding the matter for a decision in accordance with law.
The central legal point established in the judgment is the mandatory requirement of issuing a prior show cause notice and draft assessment order under the Faceless Assessment Scheme as stipulated in ....
Non-issuance of mandatory Show Cause Notice in faceless assessments violates principles of natural justice, rendering such assessment orders invalid under the Income Tax Act.
Assessments without proper prior notice and opportunity to be heard violate natural justice principles as mandated under Section 144B of the Income Tax Act.
Taxation - Faceless assessment - Section 144B(7) of Act mandatorily provides for issuance of a prior show cause notice and draft Assessment Order before issuing final Assessment Order.
The central legal point established in the judgment is the mandatory requirement of issuing a prior Show Cause Notice and draft assessment order before passing the final assessment order under the Fa....
Assessment orders under Section 144B of the Income Tax Act require prior issuance of a show cause notice and draft order; failure to comply violates natural justice.
Assessment orders issued without mandatory show-cause notice violate principles of natural justice, making them non est, despite the availability of an appellate remedy.
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