NARENDRA PANDURANG GANDHI vs. THE ASSISTANT COMMISSIONER OF INCOME TAX NATIONAL FACELESS CENTRE AND ANR

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WP/5068/2022HC BombayHCBM01016325202207 November 2023Bench: HON'BLE SHRI JUSTICE K.R. SHRIRAM,HON'BLE JUSTICE DR. NEELA KEDAR GOKHALE2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court quashed and set aside the assessment order dated March 29, 2022. The Court found it impossible for the Faceless Assessing Officer (FAO) to have considered the uploaded objections and documents and passed the assessment order within the 20-minute timeframe between the acknowledgment of objections and the passing of the order. Therefore, the matter was remanded to the FAO for de novo consideration. The FAO is directed to grant a personal hearing to the petitioner, with at least five working days' notice, and then pass a reasoned assessment order considering all submissions. The assessment order is to be passed by January 31, 2024. All consequential demand and penalty notices were also quashed and set aside. The Court explicitly stated that no observations were made on the merits of the matter.

What were the facts?

The petitioner, Narendra Pandurang Gandhi, challenged an assessment order dated March 29, 2022, passed under Section 147 read with Section 144 read with Section 144(B) of the Income Tax Act, 1961. The petitioner argued that the assessment order was passed without adhering to the principles of natural justice, as objections to the reopening were not considered and a personal hearing was not granted. The objections were filed on March 29, 2022, and the assessment order was passed on the same day at 10:14:37 IST. The uploaded objections were acknowledged at 09:51 hours on March 29, 2022. The dispute concerns the validity of the assessment order due to alleged procedural irregularities.

What were the issues?

1. Whether the assessment order passed under Section 147 read with Section 144 read with Section 144(B) of the Income Tax Act, 1961, is liable to be quashed for violation of principles of natural justice, specifically for not considering the assessee's objections to reopening and not granting a personal hearing. Assessee's Contentions: The petitioner contended that the court should entertain the writ petition under Article 226 of the Constitution of India, bypassing the alternative remedy under the Act, due to the alleged violation of natural justice. The objections to reopening were filed on March 29, 2022, and the assessment order was passed on the same day, leaving insufficient time for consideration. A personal hearing was also not granted. Revenue's Contentions: The judgment does not record specific contentions from the revenue regarding the violation of natural justice or the consideration of objections. The revenue's counsel appeared, but their arguments on this specific point are not detailed.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 144(B)

AI-generated summary — verify with the full judgment below

1/2 919-WP-5068-2022.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 5068 OF 2022 Narendra Pandurang Gandhi ….Petitioner V/s. The Assistant Commissioner of Income Tax, National Faceless Assessment Centre, Delhi and Anr. …Respondents ---- Mr. Bharat Gadhavi i/b Tejesh Dande and Associates for Petitioner. Mr. Suresh Kumar for Respondents. ---- CORAM : K.R. SHRIRAM & DR. NEELA GOKHALE, JJ.

DATED : 7th NOVEMBER 2023 P.C. : 1. Though the assessment order has been passed under Section 147 read with Section 144 read with Section 144(B) of the Income Tax Act, 1961 (the Act) on 29th March 2022, counsel states that this court should entertain this petition under Article 226 of the Constitution of India and not direct petitioner to exhaust alternative remedy available under the Act because the impugned assessment order has been passed without following the principles of natural justice. Mr. Gadhavi states that the objections to reopening has not been considered and even personal hearing was not granted. The objections have been filed on 29th March 2022 and the assessment order has also been passed on 29th March 2022 at 10:14:37 IST. From the e-proceedings response acknowledgment filed with the petition, Mr. Suresh Kumar states it appears the objections have been uploaded on 29th March 2022 at 09:51 hours. Purti Parab PURTI PRASAD PARAB Digitally signed by PURTI PRASAD PARAB Date: 2023.11.09 11:26:54 +0530

2/2 919-WP-5068-2022.doc 2. In our view it is impossible for someone to consider the reply with the documents uploaded and pass the assessment order within 20 minutes. 3. Keeping open the rights and contentions of the parties we hereby quash and set aside the assessment order dated 29th March 2022 and remanded the matter to Faceless Assessing Officer (FAO) for denovo consideration. The FAO shall after giving personal hearing to petitioner, notice whereof shall be communicated at least five working days in advance, may pass the assessment order as he deems fit in accordance with law. The order shall consider all submissions of petitioner and be a reasoned order. The assessment order to be passed by 31st January 2024. 4. Petition disposed. 5. We clarify that we have not made any observations on the merits of the matter. 6. In view of the above, all consequential demand notices, penalty notices are quashed and set aside. (DR. NEELA GOKHALE, J.) (K.R. SHRIRAM, J.) Purti Parab

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