Writ petition challenging Income Tax Assessment Order dismissed for lack of explanation

The Court dismissed the writ petition challenging an Assessment Order under the Income Tax Act, 1961, citing inadequate explanation by the petitioner regarding a deposit during demonetization. The petitioner's claims of natural justice violations were rejected, and the Assessing Officer's decision was upheld. The petitioner was advised to pursue a statutory appeal before the Appellate Commissioner within 30 days, emphasizing the right to be heard during the appeal process. No costs were awarded, and related petitions were closed following the judgment.

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Issues Involved:
The judgment involves challenges to an Assessment Order under Section 147 r/w 144(B of the Income Tax Act, 1961, based on issues of natural justice, adequacy of explanation, and proper consideration of responses by the Assessing Officer.

Natural Justice Issue:
The petitioner contended that the assessment was completed in a preemptive manner without adequate time, violating principles of natural justice. The Assessing Officer rejected the petitioner's request for adjournment, erroneously stating that no response was furnished. Citing the decision in Parthasarathy Chita v. ITO, it was argued that the impugned order should be set aside due to this procedural irregularity.

Consideration of Responses Issue:
The petitioner argued that the Assessing Officer brought two items of additions to tax without considering the petitioner's response, causing undue hardship and irreparable loss. This led to the filing of a writ petition under Article 226 of the Constitution of India, seeking the Court's intervention to address the erroneous demand created by the impugned order.

Adequacy of Explanation Issue:
Upon review, the Court found that the petitioner's attempt to invoke the Court's jurisdiction under Article 226 based on natural justice grounds was unfounded. The petitioner's explanation was deemed inadequate, leading the Assessing Officer to pass the impugned order under Section 147 r/w 144B of the Income Tax Act, 1961. Specifically, the petitioner failed to properly explain the circumstances surrounding a deposit of Rs. 52,85,000 during demonetization, which prompted the issuance of the impugned order.

Judgment Outcome:
The Court dismissed the writ petition, advising the petitioner to pursue the alternate remedy of filing a statutory appeal before the Appellate Commissioner within 30 days. The Appellate Commissioner was directed to consider the appeal and pass appropriate orders on merits in accordance with the law, ensuring the petitioner's right to be heard during the appeal process. No costs were awarded, and connected miscellaneous petitions were closed as a result of the judgment.

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