PUNJAB AND SIND BANK vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 19-1 DELHI

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W.P.(C)/11948/2022HC DelhiDLHC01030711202223 August 2022Bench: HON'BLE MR. JUSTICE MANMOHAN,HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA3 pages
AI SummaryRemanded

What did the High Court hold?

The Delhi High Court set aside the impugned order dated July 30, 2022, passed under Section 143(3) of the Income Tax Act, 1961, along with the notice of demand issued under Section 156 and the penalty notice issued under Section 274. The Court also remanded the matter back to the Assessing Officer for a fresh decision. The Assessing Officer was directed to pass a fresh order in accordance with the law on or before September 30, 2022. Crucially, the Assessing Officer was explicitly directed to provide an opportunity of hearing to the petitioner on September 1, 2022, at 11:00 AM. The Court acknowledged the Assessing Officer's admission of a mistake made in haste to meet the deadline. The principle established is that procedural fairness, including the right to a hearing, must be adhered to even under time pressures, and prior judicial directions must be scrupulously followed.

What were the facts?

The petitioner, Punjab and Sind Bank, filed a writ petition challenging an assessment order dated July 30, 2022, passed under Section 143(3) of the Income Tax Act, 1961, for Assessment Year 2018-19, along with a notice of demand under Section 156 and a penalty notice under Section 274. This was a subsequent challenge, as an earlier writ petition had been filed by the petitioner challenging a prior assessment order dated June 22, 2021, for the same assessment year. The petitioner had contended in the earlier petition that no personal hearing was granted despite a specific request, and their reply to a show cause notice was not considered. This Court had set aside the earlier assessment order and remanded the matter for a fresh decision, directing a personal hearing. Following the remand, the respondent issued notices, and the petitioner filed replies, again requesting a hearing. However, the petitioner alleged that the impugned order dated July 30, 2022, was passed without granting this opportunity, disregarding the Court's prior directions.

What were the issues?

1. Whether the Assessing Officer, in passing the assessment order dated July 30, 2022, for Assessment Year 2018-19, provided the petitioner with an adequate opportunity of hearing as mandated by law and the previous order of this Court. Assessee's Contention: The petitioner argued that the impugned assessment order, notice of demand, and penalty notice were passed in complete disregard of the mandate of law and the specific direction of this Court in its previous order dated July 16, 2021, which had set aside the prior assessment order and remanded the matter with a direction to grant a personal hearing. The petitioner asserted that despite filing detailed replies and specifically requesting a hearing, the respondent passed the order without granting this opportunity. Revenue's Contention: The Assessing Officer, present in court, stated that the matter was transferred to him in June 2022 by the National Faceless Assessment Authority. He admitted that in his haste to complete the assessment before July 31, 2022, he had committed a mistake.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 156,Section 274,Section 142(1)

AI-generated summary — verify with the full judgment below

$~27 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 11948/2022 PUNJAB AND SIND BANK ..... Petitioner Through: Mr.Salil Kapoor with Mr.Sumit Lalchandani, Advocates. versus ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 19-1 DELHI ..... Respondent Through: Mr.Puneet Rai, Sr.Standing Counsel for the Revenue with AO in person. CORAM: HON'BLE MR. JUSTICE MANMOHAN HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA O R D E R % 23.08.2022 C.M.No.35707/2022 Exemption allowed, subject to all just exceptions. Accordingly, the application stands disposed of. W.P.(C) No.11948/2022 & C.M.No.35706/2022 Present writ petition has been filed challenging the order dated 30th July, 2022 passed under Section 143(3) of the Income Tax Act, 1961 [‘the Act’] for Assessment Year 2018-19 as well as the notice of demand issued under Section 156 of the Act and notice for penalty issued under Section 274 of the Act. Learned counsel for the petitioner states that the petitioner had approached this Court by way of an earlier writ petition being W.P.(C) 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 17/06/2026 at 17:11:57

6641/2021challenging the assessment order dated 22nd June, 2021 passed under Section 143(3) read with 144B of the Act as the petitioner had not been given any personal hearing even though the petitioner had specifically requested for the same and the petitioner’s reply to the show cause notice 22nd April, 2021 had not been considered while passing the assessment order. He states that this Court disposed of the aforesaid petition by setting aside the assessment order dated 22nd June, 2021 and remanding the matter to the Assessing Officer with a direction to grant personal hearing to the petitioner. The relevant portion of this Court’s order dated 16th July, 2021 is reproduced hereinbelow:- “13. Keeping in view the aforesaid facts and mandate of law, the impugned assessment order dated 22nd June, 2021, notice of demand dated 22nd June, 2021 passed under Section 156 of the Act and notice for penalty dated 22nd June, 2021 are set aside and the matter is remanded back to the Assessing Officer, who shall grant an opportunity of personal hearing to the petitioner by way of Video Conferencing and thereafter pass a reasoned order in accordance with law.” Learned counsel for the petitioner states that pursuant to the directions of this Court, the Respondent issued a notice dated 18th July, 2022 under Section 142(1) and subsequently a show cause notice dated 28th July, 2022 with the proposed additions. He states that the petitioner filed detailed replies to the notices and specifically requested the authorities for an opportunity of hearing. He, however, states that in complete disregard of the mandate of the law and the specific direction of this Court, the Respondent passed the impugned order dated 30th July, 2022 without granting the petitioner an opportunity of hearing. 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 17/06/2026 at 17:11:57

Today the Assessing Officer is personally present in Court. He states that the matter was transferred to him by the National Faceless Assessment Authority in June, 2022. He states that in a hurry to complete the assessment prior to 31st July, 2022, he has committed a mistake. Keeping in view the aforesaid, the impugned order dated 30th July, 2022 passed under Section 143(3) of the Act as well as the notice of demand issued under Section 156 and penalty notice issued under Section 274 of the Act are set aside and the matter is remanded back to the Assessing Officer for a fresh decision. The Assessing Officer is directed to pass a fresh order in accordance with law on or before 30th September, 2022, after giving an opportunity of hearing to the Petitioner on 01st September, 2022 at 11.00 A.M. With the aforesaid directions, present writ petition along with pending application stands disposed of. MANMOHAN, J MANMEET PRITAM SINGH ARORA, J AUGUST 23, 2022 KA 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 17/06/2026 at 17:11:57

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