Repeal of S. 144B(9) vide Finance Act, 2022: Supreme Court stays High Court Order declaring Assessment Order Non-Est [Read Order]

The Supreme Court, in view of repeal of section 144B(9) of the Finance Act, 2022, has stayed an assessment order declared as non-est by the High Court.

The petitioner, National Faceless Assessment Centre submitted that, against the assessment order, the High Court ought not to have entertained the Writ Petition and ought to have relegated the original writ petitioner to avail statutory remedy of appeal before the CIT(A). It is further submitted that one of the grounds on which the High Court has set aside the assessment order was subsection (9) of Section 144B of the Income Tax Act, 1961, which, at the relevant time, provided that any assessment made shall be non est, if such assessment is not made in accordance with the procedure laid down under the said Section.

According to the department, as such, sub-section (9) of Section 144B of the Act has been deleted with effect from 01.04.2021 and the provision to declare the assessment as non est if such assessment is not made in accordance with the procedure laid down under Section 144B of the Act has been deleted and  therefore the aforesaid ground shall not be made available to the assessee, M/s Mantra Industries Limited and the assessment order would continue and the assessee, if aggrieved, was required to prefer an Appeal before the CIT(A). It is further submitted that, even the observations made by the High Court in the impugned order made, in para 9, are also not warranted, in the facts and circumstances of the case, more particularly, when the entire procedure before assessment was followed and thereafter even the legislature also deleted the provision of sub-section (9) of Section 144B of the Act retrospectively with effect from 01.04.2021.

A two-judge bench of Justice M.R. Shah and Justice B.V. Nagarathna issued notice to the assessee and held that “In the meantime, the observations made by the High Court in para 9 of the impugned judgment and order are ordered to be stayed.”

To Read the full text of the Order CLICK HERE

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