The Madhya Pradesh High Court has quashed the Faceless Assessment Order Passed Regarding Mandatory Requirements like Grant of Opportunity of Personal Hearing.
The grievance of the petitioner, Metharam Pinjani as projected by learned counsel for petitioner Shri Ashish Goyal is that though an appeal u/s 246A of the Income Tax Act, 1961 is pending before the Appellate Authority against the order of assessment impugned herein, but this petition is filed to raise certain uncontroverted facts and violation of statutory provisions, in particular Section 144(B)(7)(vii) of the Income Tax Act and thus this petition despite pendency of the appeal is maintainable and deserves adjudication on merits.
The petitioner has submitted that the show cause notice issued to the petitioner led to a response filed by the petitioner vide reply which besides refuting the contentions of the Revenue sought personal hearing in terms of Section 144(B)(7)(vii) of Income Tax Act.
The petitioner raised several other contentions which in the considered opinion of the Court are more to do with merits of the claim which is pending adjudication in shape of appeal before the Appellate Authority and therefore, this Court refrains from going into the same.
The assessee/petitioner submits that despite the said prayer having been made for personal hearing of the reply no personal hearing was afforded and the impugned order was passed thereby amounting to denial of a statutory right of personal hearing.
The division bench of Justice Sheel Nagu and Justice Sunita Yadav held that a bare perusal of the impugned assessment order (Annexure P/1) reveals that notices were issued twice to the petitioner once u/S 143(2) of the IT Act through e-mail and thereafter u/S 142(1) of the Act. Both these notices were responded to by the petitioner-assessee. Both these responses were not found satisfactory and were rejected on reasons mentioned in detail in the impugned assessment order.
“The Assessing Authority also found that the assessee failed to provide documents supportive of his stand, thereafter, final show cause notice was again issued for proposed additions of Rs. 2,86,01,971/- treating it as unexplained income. The impugned order of the assessment further reveals that in response to this final show cause notice, the assessee/petitioner has submitted details with documents of capital increased which were considered and not found satisfactory, thereafter, another show cause notice was issued on 27.01.2021, in response to which assessee submitted certain details and documents with capital account. After having afforded liberty as aforesaid of being heard which appears to be not only reasonable but sufficient, the Assessing Authority passed the impugned order,” the court.
“It is trite law that in a taxing statute one has to look merely at what is clearly said in the terminology employed. There is no presumption as to a taxing statute. Nothing is to be read in and nothing implied in the text of a taxing statute. While interpreting/analyzing taxing statute one can only look at the language used,” the court added.
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