Fair hearing in reassessment matters led to remand for de novo assessment after disputed joint development transfer treatment.

Assessment under section 147 read with section 144 was based on an accrual addition treating a joint development agreement as a transfer under section 2(47), but the assessee contended that the project had not materialised and possession had not been handed over. As proper opportunity of representation had not been afforded, the matter was considered fit for restoration to ensure a fair hearing. The assessment order was set aside and the case was remanded to the Assessing Officer for de novo assessment after giving the assessee proper opportunity.

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Issues: Whether the assessment required to be set aside and restored for de novo assessment on the ground that the assessee was not given proper opportunity before the Assessing Officer.

Analysis: The appeal arose from an assessment framed under section 147 read with section 144 of the Income-tax Act, 1961, wherein the addition was made on accrual basis by treating the joint development agreement as a transfer under section 2(47) of the Income-tax Act, 1961. The assessee sought an opportunity to place the true facts before the Assessing Officer, contending that the development agreement had not materialised and possession had not been handed over. In view of the grievance regarding lack of proper representation and the need to ensure a fair hearing, the matter was considered fit for restoration.

Conclusion: The assessment order was set aside and the matter was restored to the Assessing Officer for de novo assessment with proper opportunity to the assessee.

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