2023 (3) TMI 1160 - HC - Income Tax

Validity of Best judgment assessment - As argued by petitioner on the ground that they have not received the draft assessment order and principles of natural justice has been violated - HELD THAT - Taking note of the fact that the petitioner has been provided with sufficient opportunities to respond to the notices sent by the respondents, as seen from the tabular column referred to supra, no further time can be granted to the petitioner to submit a reply as rightly held by the respondents under the impugned assessment order. Petitioner has expressed financial difficulties in paying the pre-deposit amount. Petitioner seeks sufficient time for the petitioner to mobilize the funds to enable the petitioner to file a Statutory Appeal as against the impugned assessment order. Being an assessment order, this Court deems it fit to grant time to the petitioner to file a Statutory Appeal as against the impugned assessment order. Petitioner has not made out any case for interference by this Court under Article 226 of the Constitution of India as the principles of natural justice has not been violated by the respondents. This Court deems it fit to grant four weeks time for the petitioner to file the Statutory Appeal as against the impugned order before the Statutory Appellate Authority. Writ Petition is disposed of by directing the petitioner to file the Statutory Appeal as against the impugned assessment order before the Statutory Appellate Authority within a period of four weeks from the date of receipt of a copy of this order.

Summary

Issues:
Challenge to best judgment assessment order for assessment year 2020-21 due to non-receipt of draft assessment order and alleged violation of principles of natural justice.

Analysis:

1. Non-receipt of Draft Assessment Order and Violation of Principles of Natural Justice:
The petitioner contested the best judgment assessment order for the assessment year 2020-21, claiming non-receipt of the draft assessment order and a breach of natural justice principles. However, the court noted that the petitioner had multiple opportunities to respond to notices under Section 143(2) and Section 142(1) of the Income Tax Act. The petitioner failed to reply to several notices, as evidenced by a detailed table provided in the judgment. Despite the petitioner acknowledging a final show cause notice and requesting time to respond, the assessment order was passed within three days. The court found no fault in the respondent's decision to reject the petitioner's request for further time, considering the impending time bar on the cases. Consequently, the court concluded that the petitioner was adequately provided with opportunities to respond, and no further extension could be granted.

2. Financial Difficulties and Grant of Time for Statutory Appeal:
The petitioner raised concerns about financial constraints in making the pre-deposit amount. The court, acknowledging the gravity of an assessment order, granted the petitioner time to mobilize funds for filing a Statutory Appeal against the impugned assessment order. Despite the financial challenges, the court deemed it appropriate to allow the petitioner sufficient time to pursue the appeal process.

3. Disposal of the Writ Petition and Directions for Statutory Appeal:
The court, after reviewing the circumstances, disposed of the Writ Petition by instructing the petitioner to file a Statutory Appeal against the assessment order within four weeks from the date of receiving the court's order. The Statutory Appellate Authority was directed to consider the appeal on its merits and in compliance with the law, disregarding any limitations. The court's decision aimed to ensure the petitioner's right to appeal while upholding procedural fairness and legal standards.

In conclusion, the judgment addressed the issues raised by the petitioner regarding the assessment order, natural justice principles, financial constraints, and the statutory appeal process. The court's decision emphasized providing adequate opportunities for response, balancing procedural requirements with the petitioner's circumstances, and ensuring the proper adjudication of the matter before the Statutory Appellate Authority.