Kanpur Development Authority V. National Faceless Assessment Centre

WTAX/444/2021

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The case involves the Kanpur Development Authority as the petitioner and the National Faceless Assessment Centre as the respondent. The writ petition was filed against an assessment order passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961. The petitioner argued that they were not provided a fair opportunity to respond to the draft assessment order due to procedural lapses and technical issues with the new portal introduced by the Revenue Authority. The court found that these issues, compounded by the COVID-19 pandemic, deprived the petitioner of their right to be heard, leading to the setting aside of the assessment order.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 798680 (HC-UTTAR_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 16-07-2021
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: GAURAV MAHAJAN; MANU GHILDIYAL
• Assessee Lawyers: SHALINI GOEL; ASHISH BANSAL
• Keywords: Assessment Order; Covid-19; Faceless assessment; Hearing Opportunity; Natural Justice; Technical Issues
• Section: 143(3); 246A; 144B

Judgement Text

"Court No. - 3 Case :- WRIT TAX No. - 444 of 2021 Petitioner :- Kanpur Development Authority Respondent :- National Faceless Assessment Centre Counsel for Petitioner :- Shalini Goel,Ashish Bansal Counsel for Respondent :- Gaurav Mahajan Hon'ble Naheed Ara Moonis,J. Hon'ble Saumitra Dayal Singh,J. Heard Shri Ashish Bansal, learned counsel for the petitioner and Shri Manu Ghildiyal, learned counsel for the Revenue. The present writ petition has been filed against the assessment order dated 24.06.2021 passed under Section 143(3) r/w Section 144 B of the Income Tax Act, 1961 (hereinafter referred to as 'Act'). At the outset, preliminary objection has been raised by Shri Ghildiyal that the petitioner has an adequate remedy of appeal under Section 246A of the Act. Therefore, the instant petition may not be entertained. In reply to the aforesaid objection, learned counsel for the petitioner submits that in the present case, the rules of natural justice have been completely violated as the petitioner did not get any reasonable opportunity to furnish its reply to the draft assessment order prepared by the National Faceless Assessment Centre, as contemplated under Section 144B of the Act. It is thus submitted that the first notice along with draft assessment order was issued to the petitioner on 22.04.2021 fixing the date 26.04.2021. On 26.04.2021, the petitioner sought adjournment on account of circumstances prevailing from the spread of second wave of pandemic COVID-19. Thereafter, no further date was fixed or communicated to the petitioner. From 01.06.2021, a new portal was launched by the Revenue Authority. Further, owing to technical issues, the portal didn't work flawlessly throughout the month of June resulting in the date of filing of the returns and the date of making the assessment being extended by the Highest Administrative Authority under the Act namely CBDT. In any case, it cannot be disputed that the portal was completely not available from 01.06.2021 to 06.06.2021 and even thereafter from 07.06.2021, there were many glitches and errors not allowing all features to work. The petitioner filed a grievance petition on 11.06.2021 specifically stating that it was not able to object to the draft assessment order in the face of continuing difficulties in working on the new portal. On that date itself, a second notice was issued to the petitioner and on 24.06.2021, an ex-parte assessment order came into existence. Thus, the petitioner's right to be heard has been completely taken away owing to the approach adopted by the assessing authority despite unprecedented difficulties faced by the petitioner and changes made to the portal of the revenue authority. In view of the facts noted above, the preliminary objection raised by the learned counsel for the revenue cannot be sustained. Undisputedly before any assessment order could be passed, the assessee had an indefeasible right to be heard. In view of the circumstances arising from the spread of the second wave of pandemic COVID-19 as also in view of the facts and circumstances with respect to change of portal and accompanying difficulties that existed throughout the month of June and lastly on account of the fact that the revenue authorities have themselves extended the last date of making the assessment up to 30th September 2021 (partly in recognition of the difficulties noted above), we find that the petitioner was deprived of the opportunity of hearing for no cause. Accordingly, the assessment order dated 24.06.2021 is vitiated on that count. It is hereby set aside and the matter is remitted to concerned authority to pass a fresh order in accordance with law. Shri Bansal has again submitted that the portal is now working well enough. He will file his objections to the notices/draft assessment order dated 22.04.2021 and 11.06.2021 on or before 31st July, 2021. Thereafter, the proceedings may be continued and concluded strictly in accordance with law. With the aforesaid direction, the writ petition is disposed of. No order as to costs. Order Date :- 16.7.2021 Saurabh "