Order passed u/s 148 of Income Tax Act without fixing Hearing for Assesee: Calcutta HC directs Readjudication [Read Order]

In a recent order, the Calcutta High Court directed the re-adjudication since the order passed under section 148 of the Income Tax Act, 1961 was without fixing a hearing for the assessee by the Assessing Officer(AO) which was a violation of the Natural Justice Principle.

Rajesh Kumar Agarwal, the petitioner filed the intra-court appeal against the order passed by the Single Bench which dismissed the writ petition filed challenging the order passed by the respondent under Section 148A(d) of the Income Tax Act, 1961.  The order was on the ground of violation of principles of natural justice.

The Writ Court declined to interfere with the said order on the ground that the appellant can raise all issues in the re-assessment proceedings.

The allegation made against the appellant/assessee is that “The assessee is stated to have Allegedly purchased Rs. 31,80,194/- from shell entity Baliram Sharma and M/s. D.S. Bitumix correspondingly on other relevant expenses are spurious and attempted to evade the revenue through a colourful mechanism.”

The appellant had submitted his response within the date fixed and has also enclosed income tax returns and other documents.

A two-judge bench comprising Chief Justice, T S Sivagnanam and Justice Hiranmay Bhattacharyya found that there was no opportunity for a personal hearing granted to the assessee and the hearing was not fixed by the Assessing Officer on 29.03.2022. But the show cause notice states that the e-response should be filed by the assessee no later than 29.03.2022.

The Assessing Officer's mistake was apparent in this case. The Assessing Officer claimed that the assessee had failed to provide supporting documents for their claim, but this statement was also incorrect because the assessee had included enclosures with their response submitted on March 29, 2022.

Since there has been a violation of the principles of natural justice, the matter has to be remanded back to the Assessing Officer for a fresh decision.

While allowing the appeal, the Court set aside the order passed under Section 148A(d) of the Income Tax Act dated 6th April 2022 and remanded the matter back to the Assessing Officer for fresh consideration.

To Read the full text of the Order CLICK HERE

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