2014 (7) TMI 138 - HC - Income Tax

Violation of principles of natural justice - No notice served Held that - Before passing the final order of assessment, a notice dated 10.06.2013 was issued to the assessee, but it was not served - Rather, it was served on 22.07.2013, along with the final order dated 30.06.2013 - Therefore, the petitioner has no occasion to submit their objections to the notice dated 10.06.2013 - both the notice dated 10.06.2013 and the final order dated 30.06.2013 have been served on 22.07.2013 thereby the order dated 30.06.2013 is vitiated and is violative of the principles of natural justice - Decided in favour of assessee.

Summary

Issues:
1. Challenge to assessment order based on violation of principles of natural justice.
2. Dispute regarding service of notice to petitioner before passing final order of assessment.
3. Setting aside the impugned order and directing the respondent to consider objections.

Analysis:
1. The petitioner challenged the assessment order dated 30.06.2013, citing a show cause notice dated 10.06.2013, which was not served to them before the final order. The petitioner argued that the order violated the principles of natural justice. The respondent contended that a notice was issued on 04.11.2009 regarding ineligible input credit, to which the petitioner had replied on 04.12.2009. The impugned order was based on this reply. However, the second notice dated 10.06.2013 was served along with the final order on 22.07.2013, which the respondent did not dispute.

2. The court acknowledged that the notice dated 10.06.2013 was issued before the final assessment order but was only served on the petitioner after the final order on 22.07.2013. As a result, the petitioner was deprived of the opportunity to submit objections to the initial notice. The court concluded that the order dated 30.06.2013 was vitiated and violated natural justice principles. Therefore, the impugned order was set aside, and the petitioner was directed to submit objections within two weeks from the notice dated 10.06.2013.

3. The court allowed the writ petition, emphasizing that the petitioner should not wait for further notice and must submit objections promptly. The respondent was instructed to consider the objections, provide a hearing to the petitioner, and then pass an order based on merits and in accordance with the law. The judgment concluded by granting no costs to either party and closing the connected miscellaneous petition.