LAKSHMAN PRASAD AGARWAL vs. UNION OF INDIA AND ORS

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WPO/2148/2022HC CalcuttaWBCHCO003160202206 June 2022Bench: HON'BLE JUSTICE MD. NIZAMUDDIN3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court, considering the submissions of both parties, disposed of the writ petition by setting aside the impugned assessment order dated March 23, 2022. The Court directed the assessing officer to first consider and dispose of the petitioner's objection dated January 14, 2022, by passing a reasoned and speaking order, after providing an opportunity of hearing to the petitioner. The Court clarified that it had not adjudicated on the merits of the objection and that the assessing officer must consider it strictly in accordance with the law. Further proceedings in the assessment would be contingent upon the final outcome of the order to be passed on the petitioner's objection. The ratio decidendi is that an assessment order passed without disposing of a valid objection filed by the assessee violates principles of natural justice.

What were the facts?

The petitioner, Lakshman Prasad Agarwal, has filed a writ petition challenging an assessment order dated March 23, 2022, passed under Section 147 of the Income Tax Act, 1961, for the assessment year 2013-14. The petitioner's grievance is that the assessment order was passed without considering and disposing of his objection dated January 14, 2022, which was filed against the notice under Section 148 of the Act after receiving the recorded reasons. The petitioner contends that this action violates the principles of natural justice and the law laid down by the Supreme Court in GKN Driveshaft Ltd. The respondent, Union of India and others, represented by the Income Tax Authority, could not justify the assessing officer's action.

What were the issues?

1. Whether the assessment order dated March 23, 2022, passed under Section 147 of the Income Tax Act, 1961, for assessment year 2013-14 is liable to be set aside for being passed without considering and disposing of the petitioner's objection dated January 14, 2022, filed against the notice under Section 148 of the Act. Assessee's Contentions: The petitioner argued that the assessment order was passed in violation of the principles of natural justice and in disregard to the law laid down by the Hon'ble Supreme Court in GKN Driveshaft Ltd. (2003) 259 ITR 19. The primary contention was that the assessing officer failed to dispose of the petitioner's objection before passing the final assessment order. Revenue's Contentions: The learned advocate for the respondent Income Tax Authority could not justify the assessing officer's action in passing the impugned assessment order without disposing of the petitioner's objection dated January 14, 2022.

Which sections of the Income-tax Act were involved?

Section 147,Section 148

AI-generated summary — verify with the full judgment below

OD – 1 ORDER SHEET WPO/2148/2022 IN THE HIGH COURT AT CALCUTTA CONSTITUTIONAL WRIT JURISDICTION ORIGINAL SIDE LAKSHMAN PRASAD AGARWAL VS UNION OF INDIA AND ORS BEFORE: The Hon'ble JUSTICE MD. NIZAMUDDIN Date : 6th June, 2022. Appearance: Mr. Pranit Bag, Adv. Mr. Anujit Mookherji, Adv. …For the Petitioner Mr. Tilok Mitra, Adv. …For the U.O.I. The Court : Heard learned advocates appearing for the parties. In this writ petition, petitioner has challenged the impugned assessment order dated 23rd March, 2022 under Section 147 of the Income Tax Act, 1961 relating to assessment year 2013-14 on the ground that the same has been passed without considering and disposing his objection dated 14th January, 2022 against the impugned notice under Section 148 of the Act which was filed after receipt of the recorded reasons. Mr. Bag, learned counsel appearing for the petitioner further submits that the impugned order has been passed in violation of principles of natural justice and in disregard to the law laid down by the

Hon’ble Supreme Court in GKN Driveshaft Ltd. reported in (2003) 259 ITR 19. Mr. Mitra, learned advocate appearing for the respondent Income Tax Authority could not justify such action of the assessing officer in passing the impugned assessment order without disposing the aforesaid objection of the petitioner dated 14th January, 2022. Considering the submissions of the parties, this writ petition being WPO 2148 of 2022 is disposed of by setting aside the aforesaid impugned assessment order dated 23rd March, 2022 with a direction upon the assessing officer concerned that before proceeding any further in the assessment proceeding in question he shall first consider and dispose of the aforesaid objection of the petitioner dated 14th January, 2022 by passing a reasoned and speaking order and after giving opportunity of hearing to the petitioner. Further proceeding in the assessment will depend upon the final outcome of the order to be passed on the aforesaid objection dated 14th January, 2022. It is clarified that Court has not gone into the merit of the aforesaid objection and while considering the aforesaid objection, the assessing officer will consider the same strictly in accordance with law. (MD. NIZAMUDDIN, J.) TR/

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