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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 8217 of 2022 ================================================================
CHOPRA BULLIONS PRIVATE LIMITED Versus THE NATIONAL FACELESS ASSESSMENT CENTRE, GOVT. OF INDIA &
ANR.
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Appearance:
MR TUSHAR HEMANI, LD.SR. ADV WITH MS VAIBHAVI K PARIKH(3238)
for the Petitioner(s) No. 1 MR.VARUN K.PATEL(3802) for the Respondent(s) No. 1,2 ===============================================================
CORAM: HONOURABLE MR. JUSTICE BHARGAV D. KARIA and HONOURABLE MR.JUSTICE D.N.RAY Date : 11/03/2025
ORDER :
(BHARGAV D. KARIA, J.)
1. Heard learned Senior Advocate Mr.Tushar Hemani with learned advocate Ms.Vaibhavi K. Parikh for the petitioner and learned Senior Standing Counsel Mr.Varun K. Patel with learned advocate Mr.Dev D. Patel for the respondent.
2. By this petition under Article 226 of the Constitution of India, the petitioner has challenged the order dated 30th March, 2022 passed by Respondent under Section 147 read with Section 144B of the Income Tax Act, 1961 (for short ‘the Act’) as well as the demand notice issued under Section 156 of the Act of even date for Assessment Year 2016-17 on the ground that the reasons for re-opening were provided on 15th March, 2022 only whereas, the notice under Section 148 of the Act was issued on 30th March, 2021 and the petitioner has filed the return in response to such notice and requested for reasons recorded from time to time.
3. It also appears from the record that though the petitioner has filed the objections on 27th March, 2022 for the reasons for re- opening provided on 15th March, 2022, without disposing of such objections, the impugned Assessment Order is passed by reproducing the reply dated 29th March, 2022 in response to the notice dated 27th March, 2022 as to why the proposed variation should not be made in the Assessment Order.
4. Learned Senior Advocate Mr.Tushar Hemani for the petitioner submitted that as per the decision of the Hon’ble Supreme Court in case of GKN Driveshafts (India) Ltd. Versus Income-tax Officer reported in [2002] 125 Taxman 963 (SC), the petitioner filed the objections when the reasons were provided to the petitioner on 15th March, 2022, however, the same were not disposed of and the impugned Assessment Order is passed. It was therefore prayed that the impugned Assessment Order may be quashed and set aside and the matter may be remanded back to the respondent-Assessing Officer to pass a fresh de-novo order disposing the objections and considering the reply filed by the petitioner after considering the reply filed by the petitioner.
5. With the aforesaid directions, the impugned Assessment Order dated 30.03.2022 and demand notice of even date are hereby quashed and set aside and the matter is remanded back to the Assessing Officer to pass a fresh de- novo order within a period of twelve weeks from the date of receipt of the copy of this order.
6. The petition is accordingly disposed of. Notice is discharged. Interim-relief, if any, stands vacated forthwith.
An assessment order is invalid if objections raised by the taxpayer are not addressed prior to its issuance, ensuring due process in tax assessments.
The failure to address objections before issuing an assessment order violates principles of natural justice, necessitating a fresh assessment.
Objections to re-opening assessments must be addressed before finalizing the assessment order, as established by the Supreme Court.
The court emphasized the necessity of adhering to principles of natural justice, particularly the right to a fair opportunity to respond to show-cause notices in tax assessments.
The court ruled that the failure to provide adequate time for response to a show-cause notice constitutes a breach of natural justice, necessitating the quashing of the Assessment Order.
The court emphasized the necessity of considering a party's response in assessment proceedings, highlighting the violation of natural justice due to insufficient time granted for reply.
The assessment order became void due to the issuance of a new notice under section 148, rendering earlier proceedings infructuous.
Reopening of assessment beyond four years without fresh tangible material or proper disposal of objections is illegal under the Income Tax Act.
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