2021 (12) TMI 1296 - HC - Income Tax

Reopening of assessment u/s 147 - non passing of speaking order - petitioner has not been filed a reply to Section 143(2) notice - HELD THAT - Assessment orders have to be passed within the time. Therefore, no fault can be found with the respondent as otherwise entire exercise taken would have lapsed due to limitation. The fact remains that the petitioner has also sent a representation/objection on 28.12.2018, the date on which the Impugned Orders have been passed without a speaking order proceeding these orders. As the Impugned Assessment Orders are quashed and the cases are remitted back to the respondent to pass a speaking order in terms of the decision in GKN Driveshafts (India) Limited Vs. Income Tax Officer and Ors 2002 (11) TMI 7 - SUPREME COURT and to thereafter pass appropriate Assessment Order. Since the dispute pertains to the Assessment Years 2010-2011 and 2011-2012, the respondent may pass a speaking order preferably within a period of thirty (30) days from the date of receipt of a copy of this order based on the representation/objection filed by the petitioner on 28.12.2018 in accordance with law and on merits. The respondent shall pass Assessment order within a period of thirty (30) days thereafter.

Summary

Issues:
Challenging Impugned Assessment Order for Assessment Years 2010-2011 and 2011-2012, Failure to file response in time for Assessment Year 2011-2012, Compliance with time limits under Section 153(2) of the Income Tax Act, 1961, Request for remittance back to respondent for considering objections filed.

Analysis:
The petitioner challenged the Impugned Assessment Order dated 28.12.2018 for the Assessment Years 2010-2011 and 2011-2012, arguing that the respondent proceeded to pass the order without providing a speaking order after the petitioner filed objections. The respondent contended that for the Assessment Year 2011-2012, the petitioner did not respond in time, and hence, the orders were passed within the statutory time limits as per Section 153(2) of the Income Tax Act, 1961.

The court noted that the petitioner failed to reply to the notice for the Assessment Year 2011-2012 but acknowledged that reasons for reopening the assessments were communicated. The court emphasized the importance of passing Assessment orders within the stipulated time to avoid lapses due to limitation. However, it also recognized that the petitioner submitted objections on the same day the Impugned Orders were passed, without a speaking order preceding them.

In light of the above, the court quashed the Impugned Assessment Orders and remitted the cases back to the respondent to pass a speaking order as per the decision in GKN Driveshafts (India) Limited Vs. Income Tax Officer and Ors [2003] 259 ITR 19 (SC). The court directed the respondent to pass appropriate Assessment Orders within thirty days from the date of receipt of the order, based on the objections filed by the petitioner, ensuring compliance with the law and on merits.

Therefore, the writ petitions were disposed of with the specified instructions, and no costs were awarded. The connected Writ Miscellaneous Petitions were closed accordingly.