2019 (4) TMI 1531 - HC - Income Tax

Writ against assessment order - ex parte assessment - non compliance of notice u/s 142 - documents relating to the affairs of the petitioner society was seized by Economic Offences Unit of the Government of Bihar - alternative remedy - whether the petitioner society was precluded to respond to the notice u/s 142 due to seizer of documents by EOU Unit of the Gov. of Bihar - HELD THAT - We completely fail to appreciate that if the notice u/s 142 was received by the petitioner on 29.11.2018 what stopped the petitioner from visiting the Department either for seeking adjournment or for informing them regarding seizure of the documents by the Economic Offences Unit. It is obvious that the Assessing Authority awaiting the response from the petitioner on the notice at Annexure-4 had no other option but to pass the order on 15.12.2018 in absence of any assistance from the petitioner or any application filed in this regard. Whether the documents mentioned in Annexure-4 were under seizure of the Economic Offences Unit or not are a subject matter of the dispute in view of the stand taken by the Economic Offences Unit and we would not enter into such disputed area for the present rather bearing note of the laid back attitude of the petitioner in not responding to the notice of the Income Tax Department, for the present we would only permit him to exhaust the alternative remedy available to him under the Act and during which course the petitioner would be at liberty to raise all issues as he seeks to raise in the present writ petition. We note that pendency of the matter has taken away the period of limitation prescribed under the Act and thus we hold that if the petitioner chooses to file an appeal within four weeks from today together with the petition for condonation of delay, the Appellate Authority i.e. the Commissioner, Income Tax (Appeal) shall consider and dispose of the same in accordance with law on its own merits bearing in mind the pendency of the matter before this Court.

Summary

Issues: Ex parte assessment order challenged due to petitioner's inability to produce documents seized by the Economic Offences Unit.

The petitioner challenged the assessment order dated 15.12.2018, contending it was ex parte, primarily due to the seizure of documents by the Economic Offences Unit, preventing the petitioner from responding to the Income Tax Department's notice under Section 142 of the Income Tax Act, 1961. The court considered the petitioner's contention and the response of the Economic Offences Unit, which clarified the documents required by the Department. Despite acknowledging the petitioner's difficulties in producing the documents, the court found that the petitioner's delay in responding to the notice did not support the claim of an ex parte assessment. The petitioner received the notice on 29.11.2018 but only responded on 01.01.2019, after appearing before the Department on 17.12.2018, when handed the assessment order dated 15.12.2018.

The court questioned why the petitioner did not visit the Department upon receiving the notice to seek adjournment or inform them about the document seizure by the Economic Offences Unit. The Assessing Authority, lacking any assistance or application from the petitioner, proceeded to pass the order on 15.12.2018. The court refrained from delving into the dispute over the seized documents, emphasizing the petitioner's failure to respond promptly to the Income Tax Department's notice. The court allowed the petitioner to pursue the alternative remedy available under the Act, directing the petitioner to file an appeal within four weeks from the judgment date, along with a petition for condonation of delay. The Appellate Authority, the Commissioner of Income Tax (Appeal), was instructed to consider and decide on the appeal independently, taking into account the ongoing court proceedings.

In conclusion, the court disposed of the writ petition, noting the suspension of the limitation period under the Act due to the pending matter. The judgment highlighted the importance of timely responses to official notices and the availability of alternative remedies for addressing grievances related to assessment orders, ensuring a fair and lawful resolution of the petitioner's concerns.