2019 (9) TMI 480 - HC - Income Tax

Reopening of assessment u/s 147 - non deciding the objections or issuing any show cause notice - non passing speaking order on the objections raised by the petitioner - HELD THAT - When action was initiated u/s 148 the assessee had filed the objections which were duly acknowledged by the portal of the revenue, but without deciding the objections or issuing any show cause notice, AO had passed impugned order and issued a demand notice under Section 156. The stand of the revenue is that those objections never reached the AO. Once the objections were duly uploaded on the portal of the revenue, this argument would not be available to the revenue. Petitioner relied upon the decision of various High Courts and Apex Court in GKN Driveshafts (India) Ltd. vs. ITO 2002 (11) TMI 7 - SUPREME COURT , Garden Finance Ltd. vs. Asstt. Commissioner of Income Tax ( 2003 (10) TMI 17 - GUJARAT HIGH COURT ) and Home Finders Housing Ltd. vs. ITO, Chennai ( 2018 (5) TMI 260 - MADRAS HIGH COURT ) wherein it was held that Assessing Officer is bound to pass a speaking order on the objections raised by the petitioner, after giving an opportunity of hearing to them. We set aside the order with liberty to the revenue to re-examine the issue after taking into consideration the objections filed by them.

Summary

Issues:
Challenge to subsequent assessment under Sections 148 and 149 of the Income Tax Act, 1961. Objections filed by assessee not considered before passing impugned order.

Analysis:
The petitioner challenged a subsequent assessment under Sections 148 and 149 of the Income Tax Act, 1961. The primary contention was that the objections filed by the assessee were not considered before the Assessing Officer passed the impugned order and issued a demand notice under Section 156 of the Act. The revenue claimed that the objections never reached the Assessing Officer, but the petitioner argued that the objections were duly uploaded on the revenue's portal, making the revenue's argument invalid.

The court noted that once the objections were uploaded on the revenue's portal, the revenue's argument about the objections not reaching the Assessing Officer would not hold. The petitioner's counsel cited precedents like "GKN Driveshafts (India) Ltd. vs. ITO (2003) 259 ITR 19 (SC)" and others, emphasizing that the Assessing Officer is obligated to pass a speaking order on the objections raised by the petitioner after providing an opportunity for a hearing.

Considering the arguments and precedents cited, the court set aside the order and granted liberty to the revenue to re-examine the issue after duly considering the objections filed by the petitioner. The petition was disposed of accordingly, providing relief to the petitioner and ensuring a fair process in the assessment proceedings.