2022 (6) TMI 1249 - HC - Income Tax

Reopening of assessment u/s 147 - though the petitioner has filed return of income in response to the notice under Section 148 of the Act, the same could not be E-verified within the due date - HELD THAT - As it is seen that the petitioner had attempted to send a reply through the Web Portal, which could not be transmitted due to some technical glitches. Thereafter, the petitioner had sent his explanation, which was not accepted and therefore, the petitioner was served with notice, for which, he had sent a reply on 17.03.2022, seeking 10 days' time to furnish further submissions and documents. The reason given by the Assessing Officer that the assessment was getting barred by limitation of time and further time cannot be given, is unjustifiable and improper. Hence, this Court finds that the action on the part of the authorities in refusing to give time to the petitioner for submitting further documents, is improper. This Court is inclined to set aside the impugned order of the first respondent, dated 21.03.2022. Accordingly, it is set aside. The petitioner is directed to submit his reply along with supporting documents, within a period of two weeks from the date of receipt of a copy of this order. Thereafter, the respondents shall pass appropriate orders by following the procedures as contemplated under the Act, on merits and in accordance with law.

Summary

Issues:
Challenge against assessment order passed under Section 147 read with Section 144 read with Section 144-B of the Income Tax Act based on best judgment assessment.

Analysis:
The petitioner challenged the assessment order passed under Section 147 read with Section 144 read with Section 144-B of the Income Tax Act, contending that the authorities did not consider his replies properly and passed the impugned order hastily, violating the principles of natural justice. The petitioner's return for the assessment year 2016-2017 was initially accepted after limited scrutiny. However, subsequent notices were issued, and the assessment was done in a faceless manner. The petitioner faced technical difficulties in uploading documents on the Web Portal, leading to delays in responses. The respondents argued that the petitioner's property transactions raised suspicions, leading to the reopening of the case under Section 147 of the Act. The case was transferred to the National Faceless Assessment Centre for scrutiny. Despite the petitioner's attempts to provide explanations and documents, the authorities proceeded with the assessment, citing time limitations. The Court found the authorities' refusal to grant additional time for submission unjustifiable and set aside the impugned order, directing the petitioner to submit his reply with supporting documents within two weeks for a fresh assessment following due procedures.

Conclusion:
The High Court, under the judgment delivered by Justice M.Nirmal Kumar, set aside the impugned assessment order passed under Section 147 read with Section 144 read with Section 144-B of the Income Tax Act. The Court found the authorities' refusal to grant the petitioner additional time for submitting documents improper, emphasizing the importance of adhering to principles of natural justice. The petitioner was directed to submit his reply along with supporting documents within two weeks for a fresh assessment in accordance with the law. The Writ Petition was disposed of without costs, and connected Miscellaneous Petitions were closed.