2022 (2) TMI 921 - HC - Income Tax

Court quashes assessment order, demands fair hearing. Remitted for fresh consideration.

VIJAYANAGARA INSTITUTE OF MEDICAL SCIENCES Versus ASSESSING OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE, JURISDICTIONAL ASSESSING OFFICER, DEPUTY COMMISSIONER OF INCOME TAX, PRINCIPAL COMMISSIONER OF INCOME TAX EXEMPTIONS

The court allowed the petition, quashed the assessment order and demand notice, and remitted the matter back to the Assessment Officer for fresh ... Validity of ex-parte impugned order - senior counsel for the petitioner submits that his authorized representative and Chartered Accountant had represented and acted on behalf of the petitioner in all correspondence, filing of returns etc.,who died on 30.11. 2019 - notices issued in the name of the petitioner and sent to the defunct / inoperative email address of the deceased CA - HELD HAT:- As material on record including the death certificate of Sri.K.V.Chandrappa, the Chartered Accountant and the Authorised Representative of the petitioner who had represented him before the respondents having expired on 30.11.2019, the petitioner did not have any knowledge of any correspondence addressed by the respondents to the email address of the said K.V.Chandrappa, which had become defunct and inoperative resulting in the petitioner not being in a position to suitably reply to any of the notices issued by the respondents and file his objections and documents, details, particulars etc., as sought for by the respondents. It is clear that on account of the inability and omission on the part of the petitioner to file his objections and produce documents etc., due to bonafide reasons, unavoidable circumstances and sufficient cause, the respondents have proceeded to pass the ex-parte impugned order which deserves to be set aside and the matter remitted back to the respondents for reconsideration afresh after giving one more opportunity to the petitioner. Issues:Petition seeking quashing of assessment order and demand notice dated 30.07.2021 due to lack of communication following the death of the authorized representative.Analysis:The petitioner sought to quash the impugned assessment order and demand notice dated 30.07.2021, citing lack of communication due to the death of the authorized representative. The petitioner's senior counsel argued that after the demise of the Chartered Accountant representing the petitioner, notices sent to the defunct email address of the deceased were not received, depriving the petitioner of the opportunity to respond. The petitioner, unaware of the communication sent to the deceased representative, was unable to furnish details or objections, leading to the ex-parte assessment order. The counsel contended that the order violated principles of natural justice, emphasizing the petitioner's inability to reply due to genuine reasons and lack of knowledge regarding the notices.The respondents, however, opposed the petition, claiming no merit in the petitioner's argument. The court acknowledged the petitioner's predicament, noting the death certificate of the Chartered Accountant and the petitioner's lack of awareness regarding correspondence sent to the deceased representative's defunct email. Recognizing the petitioner's genuine inability to respond to the notices, the court concluded that the ex-parte order should be set aside. The court decided to remit the matter back to the Assessment Officer for reconsideration, emphasizing the need to provide the petitioner with another opportunity to present objections and documents, ensuring a fair hearing in compliance with the law.In the final order, the court allowed the petition, quashed the assessment order and demand notice, and remitted the matter back to the Assessment Officer for fresh consideration. The court directed the Assessment Officer to afford the petitioner an opportunity to file objections, submit documents, and receive a personal hearing in accordance with legal procedures.