Bhanushri Realities V. The National E Assessment Centre, Government of India

SCA/7507/2021

AI Insights

The case involves Bhanushri Realities, a registered partnership firm engaged in property development, which sought judicial relief against the National E Assessment Centre, Government of India, challenging an assessment order and demand notice for the Assessment Year 2018-19. The writ application under Article 226 of the Constitution of India was filed to contest the assessment order dated 24.04.2021, issued following a series of non-responses and procedural notices under the Income Tax Act, 1961. The court's decision was influenced by the unprecedented circumstances of the COVID-19 pandemic, which affected the writ applicant's ability to respond timely due to staff unavailability.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 798354 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 29-03-2022
• Assessment Year: misc
• Laws Referred To: Article 226 of the Constitution of India, Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M R BHATT CO
• Assessee Lawyers: VAIBHAVI PARIKH
• Keywords: Adjournment; Assessment Order; Covid-19; Demand notice; Final Assessment Order; Income Tax; Scrutiny assessment
• Section: 143(3); 142(1); 143(2); 68; 115BBE

Judgement Text

"C/SCA/7507/2021 ORDER DATED: 29/03/2022 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 7507 of 2021 ============================================= BHANUSHRI REALITIES Versus THE NATIONAL E ASSESSMENT CENTRE, GOVERNMENT OF INDIA ============================================= Appearance: MS VAIBHAVI K PARIKH(3238) for the Petitioner(s) No. 1 for the Respondent(s) No. 1 M R BHATT & CO.(5953) for the Respondent(s) No. 1 ============================================= CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MS. JUSTICE NISHA M. THAKORE Date : 29/03/2022 ORAL ORDER (PER : HONOURABLE MS. JUSTICE NISHA M. THAKORE) 1. By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs: “(a) quash and set aside the impugned Assessment Order dated 24.04.2021 and demand Notice dated 24.04.2021 for the Assessment Year 2018-19 at ANNEXURE – A (Colly.) to this petition; (b) pending the admission, hearing and final disposal of this petition, to stay the implementation and operation of the Assessment Order dated 24.04.2021 and demand Notice dated 24.04.2021 for the Assessment Year 2018-19 at ANNEXURE – A (Colly.) to this petition; (c) any other and further relief deemed just and proper be granted in the interest of justice; (d) to provide for the cost of this petition.” 2. The brief facts, as emerges from the record, are as under: 2.1 The writ applicant is a registered Partnership firm and is in the business of development of property. The writ applicant had filed return of income for the Assessment Year 2018-19 on Page 1 of 4 C/SCA/7507/2021 ORDER DATED: 29/03/2022 30.03.2019 declaring total income of Rs.1,48,17,740/-. The case of the writ applicant was selected for scrutiny assessment under Section 143(3) of the Income Tax Act, 1961 (for short ‘the Act’). 2.2 It appears from record that on 22.09.2019, a Notice under Section 143(2) of the Act came to be issued upon the writ applicant. However, the writ applicant did not reply to the same nor a request for any adjournment was sought for. The date of compliance referred to was 07.10.2019. On 25.11.2020, Notice under Section 142(1) of the Act came to be issued upon the writ applicant with the detailed questionnaire. Though, the writ applicant was expected to comply with the said Notice by 10.12.2020, the writ applicant failed to respond to the said notice. 2.3 It appears that the writ applicant vide letter dated 23.12.2020 had sought adjournment. On 06.01.2021, a show cause notice was issued upon the writ applicant calling upon the writ applicant to show cause as to why addition under Section 68 read with Section 115BBE of the Act should not be made and why the gross profit should not be estimated as per Industry standard. The writ applicant was required to respond by 14.01.2021. Subsequently, the writ applicant vide letter dated 16.01.2021 tendered the submissions cum objections on online portal, which was actually filed on 18.01.2021. On 20.04.2021, the show cause notice along with the draft assessment order was served upon the writ applicant as to why the assessment should not be completed as per draft assessment order. The writ applicant was required to respond by 23.04.2021. However, the writ applicant had not responded Page 2 of 4 C/SCA/7507/2021 ORDER DATED: 29/03/2022 to the same and infact, had prayed for an adjournment considering the surge of Covid cases in the month of April, 2021. 2.4 Thus, in response to the show cause notice dated 20.04.2021, the writ applicant had addressed a communication in writing dated 22.04.2021 to the respondent requesting to grant time up to Monday i.e. 26.04.2021. However, it appears that the respondent proceeded to pass final assessment order on Friday, next day itself i.e. 23.04.2021. In such circumstances, the writ applicant is here before this Court. 3. While opposing this writ application, Mr. Bhatt, the learned Senior Counsel appearing for the Revenue raised two contentions. First, with regard to the alternative remedy available to the writ applicant in the form of statutory appeal before the Commissioner and the writ applicant does not deserve any equitable relief from this Court in exercise of extra ordinary jurisdiction under Article 226 of the Constitution of India having regard to the fact that he is a habitual defaulter. 4. We have heard Mr. Tushar Hemani, the learned Senior Counsel assisted by Ms. Vaibhavi Parikh, the learned counsel appearing for the writ applicant and Mr. M.R. Bhatt, the learned Senior Counsel assisted by Mr. Munjaal Bhatt, the learned counsel appearing for the Department. 5. It appears from the record that undisputedly, the writ applicant though served with the draft assessment order, had prayed for an adjournment vide letter dated 22.04.2021. The impugned orders seems to have been passed during the time when the 2nd wave of Covid Pandemic was at its peak. It Page 3 of 4 C/SCA/7507/2021 ORDER DATED: 29/03/2022 appears that the staff of the writ applicant was not available due to surge in Covid-19 cases during the period of month of April. In such unprecedented time, it was expected from the respondent authority to consider the request of the writ applicant and sufficient opportunity should have been given. The respondent authority straight way passed the final assessment order dated 24.04.2021 without acceding to the request made by the writ applicant. 6. Considering the aforesaid peculiar circumstances, this Court finds that the matter requires consideration. The impugned assessment order dated 24.04.2021 passed by the respondent authority and consequential proceedings are hereby quashed and set aside. The matter is remitted to the respondent authority for denovo proceedings. 7. The respondent authority is directed to provide opportunity to raise detailed objections along with any material and to also grant opportunity of personal hearing, if prayed for, and thereafter, pass appropriate order in accordance with law. It could have been in the fitness of the things if the respondents would grant some more time to the writ applicant to file his reply to the show cause notice. 8. We clarify that we have otherwise not gone into the merits of the case. 9. With the aforesaid, this writ application stands disposed of. (J. B. PARDIWALA, J) (NISHA M. THAKORE,J) NEHA Page 4 of 4 "