Mallisseri Neelakandan Sankaranunni Namboodiri V. The Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income Tax Officer, Assessment Unit, Income Tax Department, National Faceless Assessment Centre, Delhi

WA/1693/2023

AI Insights

The case involves Mallisseri Neelakandan Sankaranunni Namboodiri, the appellant, who challenged an assessment order passed by the Income Tax Department. The appellant argued that his reply to a pre-assessment notice was not considered before the assessment order was passed. The Single Judge had dismissed the writ petition, attributing the oversight to the appellant's delay in responding. However, the Division Bench found that the reply was received before the assessment order was passed and that fairness required the Assessing Authority to consider the reply. Consequently, the court set aside the assessment order and remanded the matter for a fresh assessment after a personal hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 683191 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 06-10-2023
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: NAVANEETH NATH; JOSE JOSEPH
• Assessee Lawyers: HARISANKAR MENON; MEERA MENON; R SREEJITH; K KRISHNA; PARVATHY MENON
• Keywords: Assessment Order; Fairness; Income Tax; Pre-assessment notice; Taxation
• Section: 143(3)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE DR.JUSTICE A.K.JAYASANKARAN NAMBIAR & THE HONOURABLE DR.JUSTICE KAUSER EDAPPAGATH FRIDAY, THE 6TH DAY OF OCTOBER 2023/14TH ASWINA, 1945 W.A.NO.1693 OF 2023 AGAINST THE JUDGMENT DATED 13.07.2023 IN W.P(C).NO.39309/2022 OF HIGH COURT OF KERALA APPELLANT/PETITIONER: MALLISSERI NEELAKANDAN SANKARANUNNI NAMBOODIRI, AGED 63 YEARS MALLISSERI MANA, PARASSERI P O., THADUKKASSERI, KERALASSERI, PALAKKAD – 678641. BY ADV.SRI.HARISANKAR V. MENON BY ADV.SMT.MEERA V.MENON BY ADV.SRI.R.SREEJITH BY ADV.SMT.K.KRISHNA BY ADV.SMT.PARVATHY MENON RESPONDENT/RESPONDENT: THE ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER, ASSESSMENT UNIT, INCOME TAX DEPARTMENT, NATIONAL FACELESS ASSESSMENT CENTRE, DELHI – 100001. BY SRI.NAVANEETH N. NATH, SC INCOME TAX BY SRI.JOSE JOSEPH, SC INCOME TAX THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 06.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W .A.NO.1693 OF 2023 :: 2 :: J U D G M E N T D r . A.K. Jayasankaran Nambiar, J. The petitioner in W .P .(C).No.39309/2022 is the appellant herein aggrieved by the judgment dated 13.07.2023 of the learned Single Judge that dismissed the writ petition preferred by the appellant impugning an order of assessment passed by the respondent on the ground that it was passed without hearing the appellant and without considering the reply that the appellant had preferred to the pre-assessment notice. 2. The brief facts necessary for disposal of this writ appeal are as follows: The appellant, who is an agriculturist and an assessee under the Income Tax Act [hereinafter referred to as the 'IT Act'], had filed returns for the assessment year 2020-21 under the IT Act. The returns were subjected to scrutiny by the respondent, who issued Ext.P1 notice seeking the objection of the appellant to the proposed assessment. Although six such notices were apparently issued to the appellant for preferring a reply, it is not in dispute that the appellant did not respond to the earlier notices but responded only to the last W .A.NO.1693 OF 2023 :: 3 :: notice through a reply dated 22.09.2022. It would appear that without considering the said reply, which was admittedly received by the Office of the respondent prior to the passing of the assessment order, the respondent proceeded to pass Ext.P3 assessment order. The case of the appellant before the writ court was essentially that the reply of the appellant having been received by the respondent before he passed Ext.P3 assessment order, the respondent ought to have considered the said reply also while passing Ext.P3 order that was impugned in the writ petition. 3. The learned Single Judge, who considered the matter, found that it was on account of the fault on the part of the appellant that the assessment order came to be passed without considering the reply of the appellant, and hence, there was no necessity to interfere with Ext.P3 order passed by the respondent. The appellant was therefore relegated to his alternate remedy of preferring an appeal against the said assessment order. 4. We have heard Sri.Harisankar V . Menon, the learned counsel for the appellant as also Sri.Navaneeth N. Nath, the learned Standing counsel for the respondent. 4. Before us, it is the submission of Sri.Harisankar V . Menon, the learned counsel for the appellant that since the respondent had W .A.NO.1693 OF 2023 :: 4 :: received the reply to the pre-assessment notice, albeit after a delay in sending the same, it was not proper or fair on the part of the respondent to have proceeded to pass the assessment order without considering the said reply. 5. Per contra, it is the submission of Sri.Navaneeth N. Nath, the learned Standing Counsel for the respondent that the respondent had provided ample opportunities to the appellant to prefer a reply, and it was only thereafter that the respondent proceeded to pass the assessment order. 6. On a consideration of the rival submissions, we find that while it may be a fact that the appellant had occasioned a delay in preferring a reply to the pre-assessment notice, and it was under those circumstances that Ext.P3 assessment order came to be passed, we find that in the instant case, it is not in dispute that the reply dated 23.09.2022 [Ext.P2] furnished by the appellant to the respondent was received in the Office of the respondent well before the date on which Ext.P3 assessment order was passed. In matters of taxation, the respondent is obliged to mete out fairness to the assessees, and in a situation such as the present, where the reply of the assessee had been received in the Office of the respondent, we would think that the requirement of fairness mandated that the Assessing Authority refer to the said reply also, and deal with the contentions therein, while W .A.NO.1693 OF 2023 :: 5 :: passing the assessment order. Since the said reply was not considered, as is evident from a perusal of Ext.P3 assessment order, and further the assessee was not heard prior to the passing of the said order, we deem it appropriate to set aside Ext.P3 order in this appeal. Accordingly, we allow this Writ Appeal, by setting aside the impugned judgment of the learned Single Judge as also Ext.P3 assessment order that was impugned in the writ petition, and direct that the appellant shall appear for a personal hearing through video conference before the respondent on 16.10.2023, so as to enable the respondent to pass a fresh assessment order, after hearing the appellant and considering the reply furnished by the appellant. The respondent shall, on its part, furnish the videoconferencing link to the appellant at least three days before the date of hearing as above. The respondent shall thereafter pass a fresh and reasoned assessment order adverting to the contentions of the appellant in the reply furnished by him within a period of two weeks. The Writ Appeal is allowed as above. Sd/- DR. A.K.JAYASANKARAN NAMBIAR JUDGE Sd/- DR. KAUSER EDAPPAGATH JUDGE prp/6/10/23 "