2023 (1) TMI 485 - HC - Income Tax

Reopening of assessment u/s 147 - Necessity to granting personal hearing before passing the order under Section 148 A (d) - HELD THAT - A perusal of the record, in particular the reply filed pursuant to the show-cause notice discloses that the petitioner had asked for a personal hearing, in the event that the assessing officer chose to proceed further in the matter. Clearly, in this case, a personal hearing was not granted before passing the order under Section 148 A (d); the notice issued u/s 148 was only consequential. The order passed under Section 148 A (d) and the notice of even date i.e., 30.07.2022 issued under Section 148 of the Act are set aside. The matter is remitted to the concerned assessing officer for carrying out a de novo exercise. The assessing officer will also grant a personal hearing to the authorized representative of the petitioner.

Summary

Issues:
Challenging notice under Section 148 of the Income Tax Act, 1961; Personal hearing not granted before passing the order under Section 148 A (d); Setting aside the order and notice issued under Section 148 of the Act; Remitting the matter to the assessing officer for a de novo exercise; Granting a personal hearing to the authorized representative of the petitioner; Issuing a notice for the hearing; Availability of all defences to the petitioner/assessee.

Analysis:
The High Court judgment pertains to a writ petition challenging a notice issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2015-2016. The petitioner requested a personal hearing in response to a show-cause notice but was not granted one before the order under Section 148 A (d) was passed. The court noted this deficiency and set aside the order dated 30.07.2022 passed under Section 148 A (d) and the consequential notice issued under Section 148 of the Act.

The court remitted the matter to the assessing officer for a de novo exercise and directed the officer to grant a personal hearing to the authorized representative of the petitioner. The assessing officer was instructed to issue a notice specifying the date and time of the hearing. The judgment emphasized that all defences would be available to the petitioner/assessee, citing the case of Union of India v. Ashish Aggarwal (2022 SCC OnLine SC 543).

In conclusion, the writ petition was disposed of with the aforementioned directions. The pending application was closed, and the parties were instructed to act based on the digitally signed copy of the order. The judgment underscores the importance of procedural fairness and the right to a personal hearing in matters concerning tax assessments under the Income Tax Act, ensuring that all defences are duly considered in the process.