2021 (2) TMI 1207 - HC - Income Tax

Best judgment assessment u/s 144 - Valid notice issued u/s 142(1)(i) or not - proof of communication of notices and the draft assessment order - HELD THAT - The petitioner states that notice dated 20.05.2019 and penalty notice were received by her, but, on account of health issues, she could not give suitable instructions to the Chartered Accountant. A second affidavit has been filed on 18.01.2020, when the petitioner states that none of the notices referred to in the impugned assessment order have been received except notice dated 14.02.2018 that was uploaded in the portal and noted by the Chartered Accountant. Even assuming that notices dated 14.02.2018 and 20.05.2019 were not served upon the petitioner, notice dated 14.02.2018 was admittedly uploaded in the portal and has come to the attention of the petitioner. Second affidavit is styled as a 'Better Affidavit'. In my understanding, a better affidavit is one that elaborates and clarifies upon facts where the original affidavit is unclear or inadequate. It does not contemplate a situation where the fact pattern has been altered substantially. Be that as it may, two things are clear one, that the petitioner has not fied a statutory return of income and secondly that notice dated 14.02.2018 has certainly come to her attention, but has not been complied with. In the absence of co-operation with the Department in the conduct of assessments, this is not an appropriate case for interference under Article 226 of the Constitution of India. WP Dismissed.

Summary

Issues:
Challenge to assessment order based on Income Tax Act, 1961 for AY 2017-18; Allegation of violation of principles of natural justice due to non-receipt of notices by the petitioner; Non-filing of income tax return by the petitioner; Assessment based on bank information regarding demonetization period transactions; Lack of response to notices issued by Assessing Authority.

Analysis:
The judgment deals with a challenge to an assessment order passed under the Income Tax Act, 1961 for the Assessment Year 2017-18. The main contention raised was the alleged violation of principles of natural justice as the petitioner claimed not to have received further notices beyond one dated 14.02.2018. The petitioner had not filed a return of income for the relevant year. The assessment was primarily based on information provided by the petitioner's bank regarding specified bank note deposits during demonetization and other transactions. Despite notices issued by the Assessing Authority, the petitioner did not respond, citing health issues preventing her from instructing her Chartered Accountant.

The court noted that while the petitioner acknowledged receiving the notice dated 14.02.2018, there was no compliance. The petitioner submitted a subsequent affidavit, termed a 'Better Affidavit,' to clarify facts. The court clarified that a better affidavit should elaborate on unclear or inadequate facts rather than alter the fact pattern substantially. It was emphasized that the petitioner's non-cooperation in the assessment process, including failure to file a statutory return of income and respond to notices, did not warrant interference under Article 226 of the Constitution of India.

Ultimately, the court dismissed the Writ Petition, stating it was not an appropriate case for interference and ordered no costs to be imposed. The connected Miscellaneous Petition was also dismissed.