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2019 (8) TMI 1209 - HC - Income TaxNon consideration of objections to the draft assessment order u/s 144 - time limit(30 day) to file objection - validity of final assessment order - HELD THAT - We may note that Section 144C provides for forwarding of the draft assessment order to the assessee so that he could, within thirty days from the date of receipt thereof, file objections before the DRP and the AO as to the variation sought to be made by the AO to the income or loss returned. The draft assessment order was served upon the petitioner company only on 27.12.2018, the objections filed by it on 24/25.01.2019 were well within time. The action of the AO in proceeding with the final assessment on the ground that the said objections were filed beyond time and the action of the Dispute Resolution Panel in rejecting the said objections, on the same ground, therefore cannot be countenanced. The writ petition is accordingly allowed setting aside the final assessment order dated 27.02.2019 passed by the Assistant Commissioner of Income Tax, Circle-1(1), Hyderabad. The Dispute Resolution Panel-1, Bangalore, shall consider the objections of the petitioner company submitted on 24.01.2019 as per Section 144C(5) and (6) and issue necessary directions to the AO to complete the assessment of the petitioner company for the A.Y.2015-16. Pending miscellaneous petitions, if any, shall stand closed in the light of this final order.
Issues:
1. Timeliness of filing objections to draft assessment order for A.Y.2015-16. 2. Discrepancy in the date of receipt of the draft assessment order. 3. Validity of final assessment order based on objections timeline. 4. Jurisdiction of Dispute Resolution Panel-1 in addressing objections. Analysis: Issue 1: Timeliness of filing objections The petitioner company sought a writ of mandamus to restore its objections in relation to the draft assessment order for A.Y.2015-16, claiming they were filed within the statutory thirty-day timeline. The company received the draft assessment order on 27.12.2018 and filed objections before the Dispute Resolution Panel-1 and the Assessing Officer well within the stipulated period. However, the Income Tax authorities proceeded on the basis that the order was received on 17.12.2018, leading to the final assessment order dated 27.02.2019 raising a substantial demand. The dispute centered around the crucial date of receipt and the impact on the company's right to appeal. Issue 2: Discrepancy in the date of receipt The Deputy Commissioner of Income Tax asserted that the draft assessment order was received by the petitioner company on 17.12.2018, supported by data from postal authorities. In response, the company denied this assertion, providing contradictory information from postal authorities indicating a delivery date of 27.12.2018. Upon court scrutiny, discrepancies emerged in the documents submitted by both parties, prompting further investigation into the delivery date by the revenue's counsel. Subsequent clarification from the Senior Superintendent of Post Offices confirmed the delivery on 27.12.2018, resolving the discrepancy. Issue 3: Validity of final assessment order Given the confirmed delivery date of 27.12.2018, the objections filed by the petitioner on 24/25.01.2019 were within the statutory timeline. Consequently, the actions of the Assessing Officer and the Dispute Resolution Panel in rejecting the objections based on untimeliness were deemed unjustifiable. The court allowed the writ petition, setting aside the final assessment order and directing the Dispute Resolution Panel-1 to consider the objections in accordance with the provisions of Section 144C(5) and (6) of the Income Tax Act, 1961. Issue 4: Jurisdiction of Dispute Resolution Panel-1 The judgment reaffirmed the importance of the date of filing objections, emphasizing the statutory rights of the petitioner company and the implications on the appeal process. By clarifying the actual delivery date and upholding the timeliness of objections, the court underscored the significance of adherence to procedural timelines and the right of the assessee to challenge assessment orders within the prescribed limits.
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