In the recent ruling, the Orissa High Court, dismissed a writ petition challenging a manual assessment conducted under Section 143(3) of the Income Tax Act,1961 for the assessment year(AY) 2021-22.The court found that there was no Board specification requiring a faceless assessment for this case.
Sri Gopal Store, the petitioner-assessee, contested the assessment order dated July 31, 2024, and associated demand notices for the AY 2021-22. Represented by Mr. Ray, a senior advocate, the petitioner argued that the assessment had been improperly conducted manually under Section 143(3) of the Act, rather than via faceless assessment as mandated by a notification dated March 29, 2022, issued under Section 151-A of the Act.
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The Counsel contended that the faceless scheme, applicable from March 29, 2022, should have governed the assessment procedure, and thus requested the court’s intervention to set aside the assessment.
In response, the revenue’s Senior Standing Counsel, Mr. Mohanty, argued that the assessment had been validly made under Section 143(3) in conjunction with Section 260, emphasizing that the petitioner had an available statutory remedy through an appeal to the first appellate authority. The counsel maintained that the writ petition was therefore non-maintainable.
The petitioner counsel further challenged the assessment on grounds of procedural fairness, citing a violation of natural justice principles. He referenced his client’s July 19, 2023 reply to a show-cause notice, in which a formal request for the opportunity to cross-examine certain individuals was submitted.
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The petitioner counsel emphasized that no such cross-examination opportunity had been provided, despite the petitioner’s willingness to bear related costs. He argued that the denial of cross-examination, particularly in relation to a physical verification report involving Md. Amir Faijal, invalidated the assessment order.
Upon reviewing Section 144-B, the court observed it provided a comprehensive framework for faceless assessment, mandating faceless processing under certain conditions as specified by the Board.
However, no evidence was presented showing that the Board had mandated a faceless procedure for the petitioner’s assessment. The court also noted that the assessment’s factual nature required in-depth examination, which the writ petition process was not suited for.
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A coram of Arindam Sinha(Judge) and M.S Sahoo(Judge) dismissed the writ petition, declining to interfere with the assessment order.
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