Assessee has Right to get Adequate Time to file Reply to Notice: Delhi HC orders to Re-Open Portal to file Reply [Read Order]

A division bench of the Delhi High Court comprising Justice Manmohan and Justice Manmeet Pritam Singh Arora, while directing the department to re-open the e-portal the assessee has the right to get adequate time to submit reply to the income tax notice issued under Section 148A(b) of the Income Tax Act, 1961.

After receiving an income tax order, the petitioner, M/s Ester Industries Ltd has approached the High Court contending that an application for adjournment was filed by the petitioner on 24th March, 2022 seeking extension of time to file a reply to the said notice. In the request, it was stated that since the petitioner company is listed on the stock exchange, it was then working to complete its statutory compliances scheduled to be completed before 31st March, 2022. In the said request, it was further stated that since the past financial records of the petitioner are stored in a factory in Uttarakhand, the petitioner required additional time to collate the said financial records.

After hearing arguments from both sides, the High Court held that the petitioner/assessee has the right to get adequate time in accordance with the Act to submit its reply.

“It is pertinent to mention that Section 148A(b) permits the Assessing Officer to suo moto provide up to thirty day’s period to an assessee to respond to the show cause notice issued under Section 148A(b), which period may in fact be further extended upon an application made by the Assessee in this behalf, and such period given to the petitioner-assessee is excluded in computing the period of limitation for issuance of notice under Section 148A(d) of the Act in terms of the third proviso to Section 149 of the Act,” the Court said.

The Court further noted that in the present case, though the petitioner had filed an application for adjournment immediately after receipt of notice dated 17th March, 2022, the respondent had neither rejected the request for adjournment nor directed the petitioner to file a reply within the original stipulated time.

Quashing the order, the High Court directed the department to open the e-portal to enable the petitioner to upload its reply.

“In the event, the Assessing Officer wants clarification or would like the petitioner’s response to any specific information received by the revenue, it shall be open to give a supplementary notice. The respondent is directed to pass a reasoned order within 08 (eight) weeks after duly considering the reply filed by the respondent. This Court clarifies that it has not commented on the merits of the controversy. The rights and contentions of all the parties are left open,” the Court concluded.

To Read the full text of the Order CLICK HERE

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