Fair opportunity in tax assessment led to remand for fresh adjudication after reply, hearing and compliance with deposit conditions.

Assessment orders based on mismatch between returns and Form 26AS were set aside because the taxpayer had not been given a fair opportunity to contest the tax demand on merits. The court noted that no effective reply had been filed to the show cause notice and that the defence relied on an exemption notification, making fresh consideration appropriate. The matter was remitted for reconsideration after the stipulated pre-deposit, filing of a reply, and a further personal hearing, and the bank attachment was lifted as a consequence.

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Issues: Whether the impugned assessment orders were liable to be set aside for want of a reasonable opportunity to contest the tax demands on merits.

Analysis: The assessment proposals arose from the discrepancy between the returns filed and the information reflected in Form 26AS, and the demands were confirmed because no reply was filed to the show cause notice. The petitioner's case was that the proceedings had not been effectively contested and that an exemption notification was relied upon in support of the defence on merits. In these circumstances, the proceedings were found fit for interference so that the petitioner could be put on terms and given an opportunity to respond and be heard.

Conclusion: The impugned orders were set aside and the matter was remitted for fresh consideration after the petitioner complied with the stipulated pre-deposit and filed a reply, with a further opportunity of personal hearing.

Final Conclusion: The writ petitions succeeded to the extent of securing a fresh adjudication on merits after compliance with the directed deposit and procedural safeguards, and the bank attachment stood lifted as a consequence.

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