MARVY OUTSOURCING PRIVATE LIMITED vs. NATIONAL FACELESS ASSESSMENT CENTRE DELHI

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W.P.(C)/3701/2025HC DelhiDLHC01015487202527 March 2025Bench: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA3 pages
AI SummaryRemanded

What did the High Court hold?

The Delhi High Court allowed the petition and set aside the impugned assessment order. The Court found merit in the petitioner's contention that the principles of natural justice were violated. The Revenue's concession on this point was noted. The Court highlighted that the intimation letter for the personal hearing was digitally signed late on 02.02.2025, granting the petitioner less than twenty-four hours to arrange for the hearing scheduled for 03.02.2025. The Court observed that the petitioner would likely have accessed the intimation on the same day as the hearing, which is clearly insufficient. Therefore, the impugned order failed to provide a reasonable opportunity to be heard. The matter was remanded to the Assessment Unit to consider it afresh in accordance with law after affording the petitioner a reasonable opportunity to be heard within one week, with the assessment order to be passed not later than four weeks thereafter.

What were the facts?

The petitioner, Marvy Outsourcing Private Limited, filed a writ petition before the Delhi High Court challenging an assessment order dated 18.02.2025 passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961, for Assessment Year 2023-24. The petitioner also challenged consequential demand notices under Section 156 and penalty proceedings under Section 270A. The petitioner contended that the assessment order was passed in violation of natural justice and was ex facie erroneous. The Revenue conceded to the violation of natural justice. The petitioner was issued a show cause notice on 02.12.2024, with a response due by 08.12.2024. Subsequently, an intimation letter dated 02.02.2025 granted a personal hearing on 03.02.2025 at 4:15 PM. This letter was digitally signed on 02.02.2025 at 11:06 PM, giving the petitioner less than twenty-four hours' notice for the hearing.

What were the issues?

1. Whether the assessment order dated 18.02.2025, passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961, for AY 2023-24, was passed in violation of the principles of natural justice, specifically concerning the adequacy of notice for a personal hearing? (Mixed question of law and fact, concerning Section 144B). Assessee's Contention: The assessment order was passed in violation of the principles of natural justice because the petitioner was granted less than twenty-four hours' notice for a personal hearing, making it impossible to prepare adequately. The order was also ex facie erroneous and perverse. Revenue's Contention: The Revenue fairly conceded that the assessment order was passed in violation of the principles of natural justice.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144B,Section 156,Section 270A

AI-generated summary — verify with the full judgment below

$~95 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 3701/2025 & CM APPL. 17304/2025 MARVY OUTSOURCING PRIVATE LIMITED .....Petitioner Through: Mr. Mani Bhadra Jain, Mr. Sachin Jain, Advocates. versus NATIONAL FACELESS ASSESSMENT CENTRE DELHI .....Respondent Through: Mr. Shlok Chandra, Ms. Naincy Jain, Ms. Madhvi Shukla, Advocates. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MR. JUSTICE TEJAS KARIA O R D E R % 27.03.2025 1. The petitioner has filed the present petition, inter alia, impugning an assessment order dated 18.02.2025 [impugned order] passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961 [the Act] as well as the consequential proceedings including issuance of notice of demand under Section 156 of the Act and initiation of penalty proceedings under Section 270A of the Act for the Assessment Year [AY] 2023-24. 2. The petitioner assails the impugned order on two grounds. First, that it has been passed in violation of the principles of the natural justice. And second, that the impugned order is ex facie erroneous and the reasoning of the Assessing Officer [AO] is perverse. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 20:11:26

3.

Insofar as the contention that the impugned order has been passed in violation of the principles of natural justice, the learned counsel appearing for the Revenue fairly concedes to the same. 4. In the present case, the show cause notice was issued on 02.12.2024 and the petitioner was called upon to respond by 08.12.2024. Subsequently, by an intimation letter dated 02.02.2025, the petitioner was granted a personal hearing on 03.02.2025 at 4:15 PM. The petitioner has produced the physical printout of the said intimation letter which indicates that the said letter was digitally signed by the Assessment Unit on 02.02.2025 at 23:06:51, that is, at 11:06 PM. Thus, the petitioner had less than twenty-four hours to make arrangement for the personal hearing. 5. It is obvious that the said intimation letter would have been accessed by the petitioner on the next date, that is on 03.02.2025, the date on which the personal hearing was scheduled. 6. Insofar as the petitioner’s contention that the order is ex facie erroneous, the same also appears merited, as noted by this court in the order dated 25.03.2025. However, since the petitioner was granted less than twenty-four hours for a personal hearing, we are unable to accept that the same would pass muster as a reasonable opportunity to the petitioner of being heard. Thus, the impugned order falls foul of the principles of natural justice and the same is liable to be set aside. 7. In view of the above the petition is allowed and the impugned order is set aside. We remand the matter to the Assessment Unit to consider it afresh in accordance with law after affording the petitioner a reasonable opportunity to be heard within a period of one week and the assessment order shall be passed not later than four weeks thereafter. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 20:11:26

8.

The petition is allowed in the aforesaid terms. The pending application is also stands disposed of. VIBHU BAKHRU, J TEJAS KARIA, J MARCH 27, 2025 M Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 20:11:26

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