Court Reviews Income Tax Assessment Challenge for Lack of Personal Hearing; Procedural Fairness Emphasized.

The HC addressed a challenge against an assessment order under Sections 143(3) and 144B of the Income Tax Act, 1961, for AY 2018-2019, alongside related notices under Sections 156, 274, and 270A. The petitioner contested the absence of a personal hearing during the assessment. The court required the respondent to verify and provide records of the alleged hearing on 16.04.2021. The matter was adjourned to 30.03.2022 to allow time for verification and preparation, emphasizing procedural fairness and due process.

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Issues:
Challenge against assessment order dated 21.04.2021 under Section 143(3) read with Section 144B of the Income Tax Act, 1961 for AY 2018-2019. Challenge against notice of demand and penalty proceedings under Section 156, 274, and 270A of the Act. Discrepancy regarding the grant of a personal hearing to the petitioner/assessee during the assessment proceedings.

Analysis:
The writ petition challenges the assessment order dated 21.04.2021 under Section 143(3) read with Section 144B of the Income Tax Act, 1961 for the assessment year 2018-2019. Additionally, the petition contests the notice of demand issued under Section 156 of the Act and the initiation of penalty proceedings under Section 274 read with Section 270A of the Act, both dated 21.04.2021. The key contention revolves around the assessment proceedings, specifically regarding the grant of a personal hearing to the petitioner/assessee. While the impugned assessment order indicates a hearing was granted on 16.04.2021 via video-conferencing, the petitioner's counsel, Ms. Kavita Jha, asserts that no personal hearing was actually provided.

The respondent's counsel, Mr. Shailendra Singh, undertakes to confirm whether the proceedings conducted by the Assessing Officer on 16.04.2021 were recorded. If recorded, Mr. Singh agrees to present either a transcript or a digital record of the proceedings before the court on the next hearing date. Furthermore, a copy of the transcript or digital recording will be shared with the petitioner/assessee's counsel as well. This procedural step aims to clarify the actual nature of the hearing granted during the assessment process and address the discrepancy raised by the petitioner regarding the absence of a personal hearing.

In response to the submissions made by the counsels, the court schedules the matter for the next hearing on 30.03.2022, accommodating the request of the parties. The adjournment allows time for the respondent to verify the recording of the proceedings and for both parties to prepare their arguments based on the forthcoming clarification. The court's decision to list the matter for a future date demonstrates a commitment to ensuring procedural fairness and clarity in the assessment proceedings, reflecting the principles of natural justice and due process.

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