2018 (2) TMI 1915 - HC - Income Tax

Procedure u/s 144C - draft assessment order - HELD THAT - In view of the statement made on behalf of the petitioner and the respondents we pass the following order - (i) Order dated 03.08.2017 would be treated as draft assessment order. (ii) The demand notice etc. sent along with the assessing order would be accordingly treated as withdrawn. (iii) The procedure under Section 144C would be applicable and followed. The petitioner/assessee would within 30 days from today file his acceptance to the variation made by the Assessing Officer or file objections in terms of sub-Section 2 of Section 144C of the Act. (iv) The period during which the writ petition has remained pending that is from 26.08.2017 till 05.02.2018 will be excluded and will not be counted for the purpose of limitation.

Summary

Issues:
1. Validity of the Final Assessment Order dated 03.08.2017 for Assessment Year 2014-15.
2. Applicability of the procedure under Section 144C.
3. Exclusion of the period during which the writ petition remained pending for the purpose of limitation.

Analysis:
1. The petitioner filed a writ petition seeking a Writ of Certiorari to quash the Final Assessment Order dated 03.08.2017. During the hearing, the respondent's counsel, on instructions from the Joint Commissioner of Income Tax, stated that the order may be treated as a draft assessment order. The petitioner's counsel accepted this statement. Consequently, the court ordered that the order dated 03.08.2017 would be considered as a draft assessment order, and the demand notice along with the order would be withdrawn. This decision effectively nullified the Final Assessment Order, addressing the first issue raised by the petitioner.

2. The court further directed that the procedure under Section 144C would be applicable and followed. The petitioner was given 30 days to either accept the variation made by the Assessing Officer or file objections in accordance with Section 144C(2) of the Act. This ruling clarified the applicability of the specific procedural requirements under Section 144C, resolving the second issue raised in the petition.

3. Lastly, the court addressed the issue of limitation by excluding the period during which the writ petition was pending from 26.08.2017 to 05.02.2018 from the calculation of time. This exclusion was deemed necessary to ensure that the petitioner had sufficient time to comply with the procedural requirements under Section 144C without being prejudiced by delays in the legal process. The judgment, therefore, ensured that the petitioner's rights were protected in terms of the limitation period, concluding the comprehensive analysis of the issues raised in the case.

In summary, the judgment by the Delhi High Court provided a detailed resolution to the issues concerning the validity of the assessment order, the procedural requirements under Section 144C, and the exclusion of time for limitation purposes. The court's decision clarified the legal status of the assessment order, outlined the procedural steps to be followed, and safeguarded the petitioner's rights in terms of time constraints, ultimately ensuring a fair and just outcome in the matter.