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HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
MR. JUSTICE AVNEESH JHINGAN, MR. JUSTICE PRAMIL KUMAR MATHUR, JJ
Amit Gupta Huf - Appellant
Versus
Income Tax Officer, Ward 6(5), Jaipur - Respondent
D.B. Civil Writ Petition No. 20457/2019
Decided On : 11-02-2025
(A) Income Tax Act, 1961 - Section 148 - Assessment year 2014-15 - Petition challenging initiation of proceedings under Section 148 for failure to deal with objections raised by the petitioner in a speaking order - Reliance on Gkn Driveshafts (India) Ltd. case, which mandates that assessing officer must pass a speaking order on objections raised - Petitioner filed return pursuant to notice issued under Section 148 and objections were raised but not addressed properly. (Paras 1-9)
(B) Legal Obligation - The assessing officer is required to furnish reasons for issuing notice and must dispose of objections by passing a speaking order. (Paras 5-6)
Facts of the case:
The petitioner filed Income Tax Return for the assessment year 2014-15, which was scrutinized, and a notice under Section 148 was issued. The petitioner raised objections which were not dealt with adequately.
Findings of Court:
The objections must be addressed in accordance with law and a speaking order must be passed before proceeding with the assessment.
Issues: Whether the objections raised by the petitioner were adequately addressed by the assessing officer.
Ratio Decidendi: The court emphasized the necessity for the assessing officer to pass a speaking order on objections raised after issuing a notice under Section 148, as established in the Gkn Driveshafts case.
Result: Writ petition allowed, matter remitted back for proper adjudication.
Order
AVNEESH JHINGAN, J.
1. This petition is filed aggrieved of initiation of proceedings under Section 148 of the Income Tax Act, 1961 (for short ‘the Act’) for assessment year 2014-15.
2. The brief facts are that the petitioner on 30.06.2014 filed Income Tax Return for the assessment year 2014-15. The case was selected in scrutiny and the order under Section 143(3) of the Act was passed on 18.03.2016. The notice under Section 148 of the Act was issued. The petitioner in pursuance to the notice dated 27.03.2019 filed return and after supply of the reasons, objections were filed on 07.11.2019. With the notice issued under Section 142(1) of the Act, an annexure was attached dealing with the objections of the petitioner.
3. The grievance raised is that the objections have not been dealt with by passing a speaking order. The objections were not gone into stating that on issuance of notice the petitioner filed return.
4. Reliance is placed upon decision of the Supreme Court in the case of Gkn Driveshafts (India) Ltd. vs. Income Tax Officer And Ors. reported in 259 ITR Page 19.
5. Learned counsel for the respondent submits that the objections filed by the petitioner were not worth acceptance, hence were rejected.
6. Before proceedings further, it would be relevant to quote the operative part of the judgment passed in the case of Gkn Driveshafts (India) Ltd. (supra)
“5. We see no justifiable reason to interfere with the order under challenge. However, we clarify that when a notice under Section 148 of the Income Tax Act is issued, the proper course of action for the notice is to file return and if he so desires, to seek reasons for issuing notices. The assessing officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the notice is entitled to file objections to issuance of notice and the assessing officer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the assessing officer has to dispose of the objections, is filed, by passing a speaking order, before proceeding with the assessment in respect of the abovesaid five assessment years.
6. Insofar as the appeals filed against the order of assessment before the Commissioner (Appeals), we direct the appellate authority to dispose of the same, expeditiously.
7. With the above observations, the civil appeals are dismissed.”
7. The petitioner filed return in pursuance to the notice issued under Section 148 of the Act and on supply of the reasons, objections were filed. Annexure attached to the notice issued under Section 142 of the Act is not a speaking order and has not dealt with the objections raised by the petitioner.
8. The matter is remitted back to the respondent to decide the objections in accordance with law.
9. The writ petition is allowed.
10. In order to avoid further delay, let petitioner through his representative appear in the office of the respondent on 24.02.2025 at 11:00 A.M.
The assessing officer must address objections raised by taxpayers in a speaking order when issuing notices under Section 148 of the Income Tax Act.
The Assessing Officer must address objections to a notice under Section 148 of the Income Tax Act before proceeding with the assessment, as established by the Supreme Court.
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.
A quasi-judicial order must be a speaking order that addresses objections raised, ensuring compliance with natural justice principles.
The failure to supply reasons and material for reopening an assessment under the Income Tax Act violates procedural fairness, necessitating quashing of the notice.
The failure to address objections before issuing an assessment order violates principles of natural justice, necessitating a fresh assessment.
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 Assessing Officer is mandated to dispose of objections to reassessment notices by a speaking order before proceeding with the assessment.
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