The Punjab and Haryana High Court has invalidated the demand notice and penalty proceedings following an assessment order, due to the non-adherence to clauses (vii) and (viii) of Section 144B(6) of the Income Tax Act.
The Division Bench of Justice Ritu Bahri and Justice Manisha Batra, ruled that the order and notice had been passed without regard for natural justice principles.
The petitioner asserted that their case was scheduled for a video conference on March 21, 2023, at 11 a.m. However, because the petitioner’s counsel was unavailable, a request to reschedule the video conference was submitted at 7 a.m. on the same day.
The petitioner received no response from the respondent, and the request remained “open” on the petitioner’s e-filing portal. On March 21, 2023, the respondent shut down the e-submission service on the petitioner’s account.
The petitioner filed a complaint on the e-filing portal on March 21, 2023, and the grievance was resolved on March 23, 2023, as reported by the respondent to the relevant assessment unit. Despite this, the order and notices were sent out without allowing the petitioner to be heard.
The Bench noted that, “In compliance of order dated 12.04.2023, a reply dated 20.04.2023 has been filed by the respondents admitting the fact that information with respect to request of personal hearing was forwarded by respondent No. 1 (NFAC) to the concerned assessment unit on 21.03.2023.”
At this instance, Without going into the merits of the case, the petition was allowed and impugned order dated 24.03.2023 (P-6), notice of demand dated 24.03.2023 (P-7) and notice dated 24.03.2023 (P-8) were set aside by the Punjab and Haryana High Court.
The matter was also remanded back to the Assessing Officer to pass a fresh order after giving due opportunity of hearing to the petitioner, in accordance with law.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
