Court sets aside assessment order citing short response time & e-filing issues, emphasizing fair evaluation & collaboration.

The court set aside the assessment order due to the short response time and e-filing portal issues hindering the petitioner's ability to provide necessary information. The petitioner was directed to cooperate fully in the reassessment proceedings, with the revenue authorities given liberty to request any missing details. The judgment emphasized the importance of fair assessment procedures and collaboration between the parties for a thorough evaluation, ensuring the fresh assessment order would not be influenced by previous observations.

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Issues:
Challenge to assessment order, notice of demand, penalty proceedings under Income Tax Act, 1961 for AY 2017-2018.

Analysis:
The petitioner filed a return showing a loss for AY 2017-2018, which was picked for scrutiny. The petitioner claims timely responses to information requests during assessment proceedings. However, a show cause notice dated 11.06.2021 raised concerns about foreign remittances and demanded responses by 14.06.2021. The petitioner cited e-filing portal issues hindering a reply. The assessment order added a portion of investments as unexplained income under Section 68, resulting in a significant tax demand. The petitioner argued that the short response time and portal malfunction infringed its rights. Additionally, the petitioner contended that the AO failed to adjust the addition against the declared loss.

The respondent argued that despite multiple information requests, some details, like FIRC for a specific investment, were not provided. The petitioner's counsel assured that pending information could be submitted. The court noted the narrow response timeframe and portal issues as valid reasons to set aside the assessment order. The AO was directed to continue proceedings from the stage of the show cause notice, with liberty to request additional information, including the missing FIRC. The petitioner committed full cooperation for the fresh assessment order.

The court disposed of the writ petition and application, ensuring the fresh assessment order would not be impacted by the observations. The judgment emphasized fair assessment proceedings and cooperation between the petitioner and revenue authorities for a comprehensive evaluation.

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