2022 (10) TMI 768 - HC - Income Tax

Reopening of assessment - validity of notice issued u/s 148A(b) - Petitioner states that the impugned order passed without considering the detailed reply and voluminous documents/evidences filed by the Petitioner in response to show cause notice - HELD THAT - This Court is of the view that since the impugned show cause notice required the Petitioner to file the reply by 25th March 2022 i.e. within six days despite the fact that Section 148A(b) mandatorily requires to give a minimum time of seven days to the assessee to file its reply, the Respondents failed to fulfil the criterion of not less than seven days as provided in clause (b) of Section 148A of the Act. In this case, as the impugned order u/s 148A(d) had been passed after receipt of the reply of the Petitioner, this Court is of the view that Assessing Officer should have considered the reply as the same was available on record. By not considering the reply of the Petitioner dated 29th March, 2022, the mandate of Section 148A(c) of the Act has been violated as it casts a duty on the Assessing Officer, by using the expression shall , to consider the reply of the Petitioner/Assessee in response to the notice under Section 148A(b) before making an order under Section 148A(d) of the Act. Order issued u/s 148A(d) and the notice issued under Section 148 of the Act are set aside.

Summary

Issues:
Challenge to notice under Section 148A(b) of the Income Tax Act, 1961, order under Section 148A(d), and the notice under Section 148 for the assessment year 2015-16.

Analysis:

1. The petitioner challenged a notice dated 19th March 2022 issued under Section 148A(b) of the Income Tax Act, 1961, an order dated 30th March 2022 under Section 148A(d), and another notice dated 30th March 2022 under Section 148 for the assessment year 2015-16. The petitioner argued that the notice issued was in contravention of Section 148A(b) as it required a reply within six days instead of the mandated seven days.

2. The petitioner requested adjournments due to relocating to the United Arab Emirates and submitted a detailed reply with supporting evidence on 29th March 2022 before the order was passed. However, the impugned order dated 30th March 2022 did not consider this reply or the documents submitted, erroneously stating that no response was received from the petitioner.

3. The court found that the notice did not comply with the minimum seven-day requirement as per Section 148A(b) of the Act. Additionally, it held that the Assessing Officer should have considered the petitioner's reply dated 29th March 2022 before passing the order under Section 148A(d), as mandated by Section 148A(c) which requires the officer to consider the reply before making an order.

4. Consequently, the court set aside the impugned order dated 30th March 2022 issued under Section 148A(d) and the notice dated 30th March 2022 issued under Section 148 of the Act. The respondents were directed to consider the submission filed on 29th March 2022 and pass a reasoned order within eight weeks, in accordance with the law. The writ petition and pending application were disposed of with these directions.