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2020 (9) TMI 333 - HC - Income Tax


Issues:
1. Validity of notice issued under Section 148 of the Income Tax Act, 1961 for the assessment year 2015-16.
2. Requirement of providing reasons for issuing notice and opportunity of hearing to the petitioner.
3. Compliance with the due procedure by the Assessing Officer.

Analysis:
1. The petitioner challenged the notice dated 26.2.2020 issued by the respondent No.2 under Section 148 of the Income Tax Act, 1961 for the assessment year 2015-16, alleging that her income chargeable to tax had escaped assessment. The petitioner requested reasons for the notice but had not received them, leading to the belief that no reasons were recorded by the respondent No.2. The petitioner contended that the notice was issued without following due procedure, as per Section 147 of the Act of 1961.

2. The petitioner's counsel relied on the judgment of the Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd. vs. Income-Tax Officer, emphasizing the obligation of the Assessing Officer to furnish reasons within a reasonable time upon issuing a notice under Section 148. The petitioner argued that the Assessing Officer had failed to provide reasons and was proceeding to pass a final order without granting proper opportunity of hearing. The petitioner sought adherence to the procedure outlined by the Supreme Court for issuing notices under Section 148.

3. The High Court, referencing the judgment in GKN Driveshafts (India) Ltd., directed the Assessing Officer to supply reasons to the petitioner within one week of the order, following the petitioner's representation dated 3.4.2020. Upon receiving the reasons, the petitioner was granted one week to file objections to the notice dated 26.2.2020. The Assessing Officer was instructed to consider these objections and pass a speaking order within a reasonable time. The Court explicitly stated that any final order pursuant to the notice should not be passed without adhering to the prescribed procedure, emphasizing the importance of providing reasons and opportunity for objections and hearing before finalizing the assessment.

 

 

 

 

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