2011 (3) TMI 931 - HC - Income Tax

Block assessment - No speaking order - The respondent is directed to consider the objections raised by the petitioner, on 15.09.2010, and pass a separate speaking order, within a period of eight weeks from the date of receipt of a copy of this order and to proceed further, as per law - Accordingly writ petition is disposed of

Summary

Issues:
1. Failure to pass a separate speaking order on objections raised under Section 147 of the Income Tax Act, 1961.

Analysis:
The petitioner contended that the respondent's order dated 31.12.2010, under Section 147 of the Income Tax Act, was invalid as it did not include a separate speaking order addressing the objections raised on 15.09.2010. Citing the decision of the Hon'ble Supreme Court in GKN Driveshafts (India) Limited vs. Income Tax Officer & Others ((2003) 259 ITR 19(SC)), which emphasized the requirement for the Assessing Officer (AO) to furnish reasons and dispose of objections by passing a speaking order, the petitioner sought relief. The respondent did not refute the petitioner's submissions.

The High Court found merit in the petitioner's argument and set aside the impugned order of the respondent dated 31.12.2010. The respondent was directed to consider the objections raised on 15.09.2010 and pass a separate speaking order within eight weeks from the date of the court's order. The court emphasized that the respondent must adhere to the legal process in dealing with objections before proceeding further in accordance with the law.

Therefore, the writ petition was allowed, with no costs imposed, and the connected miscellaneous petition was closed. The judgment highlighted the importance of following due process and providing a speaking order when addressing objections raised by the noticee under Section 147 of the Income Tax Act, 1961.