2022 (5) TMI 1662 - HC - Income Tax

Tax Assessment Order Annulled Due to Breach of Natural Justice; Case Remanded for New Assessment Allowing Petitioner Response.

The HC of Calcutta annulled the assessment order dated 30th March 2022 under the Income Tax Act, 1961, for the assessment year 2013-2014, citing a breach ... Violation of principle of natural justice - opportunity to file reply to show-cause notice/draft assessment - assessment order passed before expiry of time granted - technical glitches in department's e-filing portal - remand for fresh assessment and requirement of reasoned and speaking orderViolation of principle of natural justice - opportunity to file reply to show-cause notice/draft assessment - assessment order passed before expiry of time granted - technical glitches in department's e-filing portal - Impugned assessment order is not sustainable for having been passed before the expiry of the time granted to the petitioner to file reply to the show-cause notice, and where technical glitches in the Department's e-filing portal prevented the petitioner from filing his reply. - HELD THAT: - The Court found on the material before it that the Assessing Officer had allotted time to the petitioner to file a reply to the show-cause notice/draft assessment but passed the final assessment order prior to the expiry of that time. The petitioner's plea that he could not file his response on account of technical glitches in the Department's portal was not denied by the respondents and is substantiated by the record. In those circumstances, the impugned assessment order infringed the principle of natural justice by denying the petitioner the opportunity to be heard and therefore cannot be sustained in law.Impugned assessment order dated 30th March, 2022 set aside as unsustainable for breach of natural justice.Remand for fresh assessment and requirement of reasoned and speaking order - opportunity to file reply to show-cause notice/draft assessment - Matter remitted to the Assessing Officer for fresh assessment after affording the petitioner an opportunity to file his reply and for the AO to pass a reasoned and speaking order. - HELD THAT: - The Court directed that the petitioner be permitted to file his reply to the show-cause notice dated 29th March, 2022 within seven days from the date of the order. The Assessing Officer is required to consider that reply and to pass a fresh assessment order in accordance with law, observing the principle of natural justice and recording reasons in a speaking order. The remand is for fresh consideration and adjudication on merits after giving the statutory opportunity of hearing; the Court did not decide the merits of the assessment itself.Matter remanded to the Assessing Officer to pass a fresh, reasoned and speaking assessment order after receiving the petitioner's reply filed within seven days.Final Conclusion: Writ petition allowed to the extent that the assessment order dated 30th March, 2022 is set aside; the matter is remanded to the Assessing Officer for fresh adjudication after permitting the petitioner to file his reply within seven days and directing the AO to pass a reasoned and speaking order in conformity with the principles of natural justice. The High Court of Calcutta set aside the impugned assessment order dated 30th March, 2022, under the Income Tax Act, 1961 for assessment year 2013-2014 due to violation of natural justice. The petitioner was not given an opportunity to reply to the show-cause-notice before the assessment order was passed. The case is remanded back to the Assessing Officer for a fresh assessment order with proper opportunity for the petitioner to respond. (Case Citation: TMI, WPA 8232 of 2022)