Court requires assessee to resolve objection before challenging re-assessment The Court declined to entertain the challenge to the re-assessment proceedings for the assessment year 2015-16 before the assessee's objection was ...
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Court requires assessee to resolve objection before challenging re-assessment
The Court declined to entertain the challenge to the re-assessment proceedings for the assessment year 2015-16 before the assessee's objection was resolved by the assessing authority. Emphasizing procedural fairness, the Court directed the petitioner to file a physical copy of the order and application to the assessing authority under the faceless scheme. The authority would then issue a notice for the objection hearing, allowing the petitioner to present objections. Following the hearing, a reasoned order would be communicated to the petitioner, with the option to challenge the decision at a later stage if needed.
Issues: Challenge to re-assessment proceedings for assessment year 2015-16.
Analysis: The petitioner challenged the re-assessment proceedings initiated against them for the assessment year 2015-16. The notice for re-assessment was issued by the Assessing Officer, Income Tax, Special Range, Kanpur. The petitioner filed a return through e-mode in response to the notice and was later provided with the "reasons to believe" for initiating the re-assessment proceedings along with the approval order under section 151 of the Income Tax Act, 1961. The petitioner then filed a written objection to the initiation of the re-assessment proceedings, and as a result, the re-assessment proceedings are pending.
The Court, following the procedural principle established by the Supreme Court in the case of GKN Driveshafts (India) Ltd. vs Income Tax Officer and another, 2003(259) ITR 19 (SC), decided not to entertain the challenge to the re-assessment proceedings before the objection filed by the assessee is disposed of by the assessing authority. The Court emphasized the importance of deciding the assessee's objection before proceeding with issuing any further notice for conducting the re-assessment proceedings.
Under the faceless scheme, where the assessee is unaware of the identity or location of the assessing authority, the Court issued specific directions. The petitioner was instructed to file a physical copy of the order along with an application to inform the respondent no.1 about the order and compliance. Upon compliance, the assessing authority would issue a notice to decide on the objection filed by the petitioner, providing adequate notice for the hearing. The objections could be decided either through physical or virtual proceedings, ensuring the petitioner has an opportunity to present their objections and respond to queries.
Once the proceedings are completed, a reasoned order would be passed by the authority hearing the objections and communicated to the petitioner. If the objections are rejected, the re-assessment proceedings could be fixed for a later date. The Court clarified that they did not examine the merit of the challenge at that stage, leaving it open to be raised at an appropriate time.
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