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DELHI HIGH COURT
MANMOHAN, SUDHIR KUMAR JAIN
Grand Reality Pvt. Ltd. – Appellant
Versus
Assistant Commissioner of Income Tax (OSD) – Respondent
| Table of Content |
|---|
| 1. petition challenges assessment order. (Para 1) |
| 2. violation of natural justice due to insufficient notice. (Para 2 , 3 , 4) |
| 3. delay in providing reasons blamed on department. (Para 5 , 6 , 7) |
| 4. assessment order quashed; objections must be filed. (Para 8) |
| 5. writ petition disposed with directions. (Para 9) |
JUDGMENT
Manmohan, J. (Oral)--Present writ petition has been filed challenging assessment order dated 29th September, 2021 passed under Section 147 read with Section 144 of the Income Tax Act, 1961 [for short `the Act'] for the assessment year 2013-14 as well as the demand notice issued under Section 156 of the Act. Petitioner also seeks a direction to restrain the Respondents from giving effect to or proceeding further pursuant to the impugned order as well as demand notice.
2. Learned counsel for the Petitioner states that the procedure laid down by the Supreme Court in GKN Driveshafts (India) Ltd. v. ITO, (2003) 259 ITR 19 was not followed inasmuch as, although pursuant to notice dated 19th March, 2020 issued under Section 148 of the Act, the return was filed on 29th May, 2020, yet the reasons to believe were not provided within reasonable time as mandated by
The failure to provide adequate opportunity to respond in tax assessment proceedings constitutes a violation of natural justice, necessitating the quashing of the assessment order.
Violation of the principle of natural justice due to lack of reasonable time to file objections to the reasons furnished by the Respondents
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 court ruled that an assessment order issued without observing due process and the principles of natural justice is invalid, necessitating a fresh assessment.
The court ruled that a valid assessment order under the Income Tax Act requires adherence to statutory procedures, including compliance with natural justice, particularly when external circumstances ....
The assessment order is to be passed only after considering the reply of the assessee as per Section 144B(1)(xxiv) of the Income Tax Act, and failure to do so constitutes a violation of the mandatory....
The court established that an assessment order must consider the taxpayer's responses as part of the mandatory procedure required by law, failure of which renders the order invalid.
The assessing officer is bound to dispose of the objections filed by the noticee before proceeding with the assessment after issuing a notice under Section 148 of the Income Tax Act.
The assessing officer must dispose of objections to a Section 148 notice with a speaking order before further assessment proceedings can continue.
Assessment orders must respect natural justice, providing parties an effective opportunity to respond, especially during extraordinary situations like a pandemic.
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