Court sets aside penalty order for Assessment Year 2021-22 due to lack of personal hearing granted. Fresh order directed.

The court set aside the penalty order and demand notice for Assessment Year 2021-22 due to lack of personal hearing granted to the petitioner's authorized representative. The Assessing Officer (AO) was directed to pass a fresh order after providing a personal hearing, addressing all contentions, including the excess deduction claim. The AO was also instructed to decide on the pending immunity application. The writ petition was disposed of with directions not impacting future orders. Parties were directed to comply with the digitally signed order.

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Issues involved:
The judgment concerns a writ petition related to the penalty order and demand notice for Assessment Year 2021-22, where the petitioner claimed excess deduction under Section 35(2AB) of the Income Tax Act, 1961.

Details of the judgment:

Issue 1: Excess Deduction Claimed
The petitioner was allowed to claim a deduction at the rate of 100% but claimed it at the rate of 200%, citing a mistake due to a law amendment after AY 2017-18. The petitioner contended that the cap for deduction was 150% between 2018-19 and 2019-20. The main ground raised was a breach of natural justice.

Issue 2: Lack of Personal Hearing
The petitioner argued that the penalty order was passed without granting a personal hearing to the authorized representative. Evidence of the request for a personal hearing was presented, which was not disputed by the respondent's counsel. Due to the absence of a personal hearing, the court decided to set aside the penalty order and the consequential notice.

Resolution:
The court ordered the Assessing Officer (AO) to pass a fresh order after granting a personal hearing to the petitioner's authorized representative. The AO was directed to issue a notice indicating the date and time of the hearing. The new order should address all contentions of the petitioner, including the claim of misreporting. The petitioner should receive a copy of the speaking order. The AO was also instructed to decide on the pending immunity application as per the law. The writ petition was disposed of accordingly, clarifying that the directions given would not impact any future order by the AO. Pending interlocutory applications were closed, and parties were directed to act based on the digitally signed copy of the order.

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