JOSHI ENTERPRISES vs. ASSESSMENT UNIT COMMISSIONER OF INCOME TAX AND ORS

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WP/7268/2021HC BombayHCBM01021881202130 November 2021Bench: HON'BLE SHRI JUSTICE K.R. SHRIRAM,HON'BLE SHRI JUSTICE AMIT BORKAR2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court allowed the petition in terms of prayer clause (a). The Court declared the assessment order dated 13.04.2021, passed under Section 143(3) read with Sections 143(3A) and 143(3B), the notice of demand dated 13.04.2021 under Section 156, and the penalty notice under Section 270A read with Section 274 for assessment year 2018-19, as illegal, bad-in-law, non-est, arbitrary, and in total contravention of the principles of natural justice. The matter was remanded for de novo consideration. The respondents were directed to strictly comply with the procedure prescribed under Section 144B of the Income Tax Act, 1961, and pass an order within 8 weeks. Before passing the order, the respondents were also directed to consider the submissions made by the petitioner and grant a personal hearing. No specific issue was left undecided.

What were the facts?

The petitioner, Joshi Enterprises, filed a writ petition before the Bombay High Court challenging an assessment order dated 13.04.2021, a notice of demand dated 13.04.2021, and a penalty notice dated 13.04.2021, all pertaining to assessment year 2018-19. The petitioner's grievance was that the assessment order was passed without issuing a show cause cum draft assessment order and without granting a personal hearing. The Revenue, through its counsel, conceded that the petitioner's grievance was not unjustified and agreed to the prayer for remanding the matter for de novo consideration.

What were the issues?

1. Whether the assessment order dated 13.04.2021, notice of demand dated 13.04.2021, and penalty notice dated 13.04.2021 for assessment year 2018-19 are illegal, bad-in-law, non-est, arbitrary, and in total contravention of the principles of natural justice, liable to be quashed, as contended by the petitioner. Assessee's Contention: The petitioner argued that the assessment order was passed in violation of the principles of natural justice, specifically by not issuing a show cause cum draft assessment order and not granting a personal hearing. The petitioner sought to declare these orders illegal and liable to be quashed. Revenue's Contention: The Revenue, through its counsel, acknowledged the petitioner's grievance and stated that the petitioner could not be considered unjustified in raising it. The Revenue agreed to the prayer for remanding the matter for de novo consideration.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 143(3A),Section 143(3B),Section 156,Section 270A,Section 274,Section 144B

AI-generated summary — verify with the full judgment below

1/2 921-wp-7268-21.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.7268 OF 2021 Joshi Enterprises

….Petitioner V/s. Assessment Unit, Additional / Joint/ Deputy Assistant Commissioner of Income Tax & Ors. …Respondents ---- Mr. V. Sridharan, Senior Advocate a/w Mr Ravi Sawana i/v Mr. Tanmay Phadke for Petitioner Mr. Sham V. Walve a/w Mr. Pritesh Chatterjee for Respondent-Revenue ---- CORAM : K.R. SHRIRAM & AMIT B. BORKAR, JJ

DATED : 30th NOVEMBER 2021 P.C. : 1 Petitioner is raising a grievance that the assessment order has been passed without issuing a show cause cum draft assessment order and without granting a personal hearing. Mr. Walve in fairness and as an officer of this court states though a reply has been filed, petitioner cannot be stated to be unjustified in raising the grievance. Mr. Walve states that the court may grant prayer clause (a) and remand the matter for denovo consideration. 2 In view of what is stated by Mr. Walve petition is allowed in terms of prayer clause (a) which reads as under. “(a) Declare that the assessment order dated 13.04.2021, passed under Section 143(3) read with Sections 143(3A) and 143(3B) of the Act, notice of demand dated 13.04.2021, issued under Section 156 of the Act and the penalty notice issued under Section 270A read with Section 274 of the Act for assessment year 2018-19 (Exhibits” P, Q and R”) are illegal, bad-in-law, non-est, arbitary, in total contravention of the principles of natural justice, and liable to be quashed.” Meera Jadhav MEERA MAHESH JADHAV Digitally signed by MEERA MAHESH JADHAV Date: 2021.12.03 11:40:22 +0530

2/2 921-wp-7268-21.doc The matter is remanded for denovo consideration. Respondents shall strictly comply with the procedure prescribed under Section 144B of the Income Tax Act 1961 and within 8 weeks pass such order as it deems fit in accordance with law. Before passing such orders, certainly, respondents shall consider the submissions made by petitioner and also grant a personal hearing. 3 Petition disposed. (AMIT B. BORKAR, J) (K.R. SHRIRAM, J.) Meera Jadhav

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