Natural justice in faceless assessment: illusory hearing led to quashing of the assessment and remand for fresh adjudication.
An assessment order under section 144 read with section 144B of the Income-tax Act, 1961 was held vitiated for breach of natural justice because the taxpayer had sought adjournment and a meaningful opportunity to reply, yet the video conferencing intimation was issued only a few hours before the hearing. The court found the hearing illusory and inconsistent with the fair-hearing requirement in faceless assessment proceedings. The assessment order was quashed and the matter remanded for fresh adjudication after giving proper time to file a reply and participate in video conferencing.
Issues: Whether the assessment order passed under section 144 read with section 144B of the Income-tax Act, 1961 was vitiated for breach of natural justice on account of inadequate opportunity of hearing and denial of effective video conferencing, and whether it was liable to be quashed and remanded.
Analysis: The petitioner had received the show-cause notice and sought an adjournment, specifically requesting a hearing after a stated date so as to file an effective reply. Despite that request, the authorities issued a video conferencing intimation only a few hours before the scheduled hearing. The respondents did not dispute the short notice or the request for adjournment. In these circumstances, the opportunity afforded was found to be illusory and not in conformity with the requirement of a fair hearing under the faceless assessment procedure.
Conclusion: The assessment order was quashed and set aside, and the matter was remanded to the assessing authorities for fresh adjudication after granting a proper opportunity to file a reply and to participate in video conferencing.
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