RAMA INTELLECTUAL AND RESEARCH PRIVATE LIMITED V. PRINCIPAL COMMISSIONER OF INCOME TAX AND 2 OTHERS

WTAX/468/2023

AI Insights

The case involves Rama Intellectual And Research Private Limited challenging an assessment order for the assessment year 2018-19, issued by the Faceless Assessment Authority under sections 147, 144, and 144-B of the Income Tax Act, 1961. The petitioner contested the initiation of re-assessment proceedings and the validity of the re-assessment order dated 06.03.2023. The court found that the Assessing Authority did not consider the petitioner's replies to the notices issued, which constituted a violation of the principles of natural justice. Consequently, the court set aside the assessment order and remitted the matter for a fresh assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 672412 (HC-ALLAHABAD)
• Appeal Type: Others
• Pronouncement Date: 10-05-2023
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: GAURAV MAHAJAN; ASHISH AGRAWAL
• Assessee Lawyers: ASHISH BANSAL
• Keywords: Faceless assessment; Natural Justice; Non application of mind; Re-assessment
• Section: 147; 148; 144; 142(1); 144(b)

Judgement Text

"Neutral Citation No. - 2023:AHC:100541-DB Chief Justice's Court Case :- WRIT TAX No. - 468 of 2023 Petitioner :- Rama Intellectual And Research Private Limited Respondent :- Principal Commissioner Of Income Tax And 2 Others Counsel for Petitioner :- Ashish Bansal Counsel for Respondent :- Gaurav Mahajan,Ashish Agrawal Hon'ble Pritinker Diwaker,Chief Justice Hon'ble Saumitra Dayal Singh,J. 1. Heard Sri Ashish Bansal, learned counsel for the petitioner and Sri Ashish Agrawal, learned counsel for the revenue. 2. Challenge has been raised to the assessment order dated 06.03.2023 passed by the Faceless Assessment Authority in the case of the petitioner for A.Y. 2018-19 under Section 147 read with Section 144 and 144-B of the Income Tax Act, 1961 (hereinafter referred to as the 'Act'). Also, challenge has been raised to the initiation of re-assessment proceedings. At the same time, learned counsel for the petitioner has stated, with respect to the initiation of re-assessment proceedings, the petitioner had first filed rectification application before the Assessing Authority. On that application being rejected, the petitioner has approached the Revisional Authority. Revision is still pending. 3. In view of the above, we are not going into the question of validity of re-initiation of the proceedings as that issue is engaging the attention of the statutory authority. For the limited consideration, we propose to offer in the present proceedings, it is therefore assumed for the time being, the re-assessment proceedings were validly initiated. However, that is only a tentative observation necessary to be made at this stage to consider the other submissions being advanced by learned counsel for the petitioner. However, that issue would abide by the outcome of the revision proceeding. 4. On the issue of validity of re-assessment order dated 06.03.2023, it has been strenuously urged, the above order was preceded by four notices dated 30.03.2022 (issued under Section 148 of the Act), 12.10.2022 and 22.12.2022 [issued under Section 142(1) of the Act]. The last notice dated 01.02.2023 was a regular show-cause-notice issued for fixing date 15.02.2023. 5. Referring to the documents annexed to the writ petition, it has been shown to us, the petitioner had submitted not less than two replies dated 31.10.2022 (in response to the notice dated 12.10.2022) and 03.03.2023 (in response to the notice dated 22.12.2022 and 01.02.2023). Submission of such replies cannot be disputed as prima facie the acknowledgement itself discloses due filing of such replies. 6. In that fact, it has been submitted, the Assessing Authority has acted with complete non-application of mind inasmuch as the assessment order contains a clear recital that the notice issued to the petitioner remained unresponded. Even while making discussion over the material issues, the Assessing Authority has not adverted to the reply tendered by the petitioner. Thus, it does appear, the assessment order is ex parte to the extent it does not take note of the petitioner's replies and does not offer any consideration of the objection made by the petitioner. 7. Requirement of natural justice is not met by taking on record replies filed by the petitioner but it is the consideration of the reply on merits before reaching any conclusion that must be done to show due compliance of that rule. In the present facts, as noted above, that pre-requirement of law was given a complete go-by, may be due to inadvertence. 8. In such circumstances, learned counsel for the revenue fairly states, at present he cannot establish from the record that due consideration had been made by the Assessing Authority to the replies filed by the assessee. 9. In view of such fair statement made, no useful purpose would be served in keeping the present writ petition pending or calling for reply. Accordingly, the present writ petition is allowed. The impugned order dated 06.03.2023 is set aside and the matter is remitted to the Faceless Assessment Authority to pass a fresh order strictly in accordance with law as may necessarily involve granting opportunity of hearing to the petitioner before any fact decision may arise. Order Date :- 10.5.2023 Abhilash . (S. D. Singh, J) (Pritinker Diwaker, CJ) Digitally signed by :- ABHILASH SINGH High Court of Judicature at Allahabad "