Assessment order quashed for denying personal hearing opportunity despite assessee's reply under Section 129

The HC allowed the writ petition filed by the assessee against an assessment order passed without providing opportunity of personal hearing. The court found that after the assessee filed reply on 22.07.2022, no notice for personal hearing was issued before passing the impugned order, constituting violation of natural justice principles. The court rejected the department's contention that the assessee failed to utilize opportunity under Section 129 of IT Act for rehearing. The assessment order was set aside and matter remanded to AO for reconsideration after providing opportunity of personal hearing to the assessee.

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Issues Involved:
The issues involved in this case are the assessment order passed by the respondent for the Assessment Year 2018-19, violation of principles of natural justice, non-provision of opportunity of personal hearing, and challenge to the assessment order dated 30.07.2022.

Assessment Order Challenge:
The petitioner, an assessee under the Income Tax Act, filed ITR-3 for AY 2018-19 declaring gross total income. The case was selected for limited scrutiny regarding agricultural income. Despite the petitioner filing responses and documents, the respondent passed an assessment order treating gross total income differently, leading to a demand. The petitioner challenged this order, resulting in its quashing and remittance for a speaking order. However, the respondent issued further notices and clarification letters, eventually passing a new assessment order on 30.07.2022, which the petitioner now challenges.

Violation of Natural Justice:
The petitioner's counsel argues that the impugned order was passed without providing an opportunity of personal hearing, violating principles of natural justice. The petitioner's main grievance is the lack of a personal hearing, as the respondent proceeded to pass the assessment order without considering the details furnished by the petitioner. The petitioner contends that the order was passed in gross violation of natural justice principles, as the new Assessing Officer did not inform about the change, denying the petitioner a chance for a rehearing.

Respondent's Defense:
The respondent contends that sufficient opportunities were provided to the petitioner before passing the assessment order. However, the petitioner's failure to seek a rehearing opportunity after the change of Assessing Officer is highlighted. The respondent assures compliance with any orders passed by the Court.

Court's Decision:
The Court notes that the earlier assessment order was quashed due to a lack of opportunity for the petitioner to be heard. Despite subsequent communications from the petitioner, the respondent did not provide a personal hearing before passing the impugned order. The Court finds that the order was passed in clear violation of natural justice, as no opportunity for personal hearing was granted after the petitioner's replies. Consequently, the impugned order is set aside, and the matter is remanded back to the respondent for re-consideration after providing the petitioner with a personal hearing scheduled for 20.12.2023.

Conclusion:
The Court allows the Writ Petition, setting aside the impugned order and directing a re-consideration of the assessment proceedings with a scheduled personal hearing for the petitioner. No costs are awarded, and connected Writ Miscellaneous Petitions are closed.

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