9911796707
TMI Blog2019 (10) TMI 641X X X X Extracts X X X X X X X X Extracts X X X X ..... d by him in the return. Ultimately, by Ext.P17 assessment order, all that the department did, was to deny the claim for exemption of the petitioner assessee, and while doing so, the department was not obliged to grant any hearing to the petitioner over and above the opportunities that had already been extended to the petitioner to respond to the specific queries raised by the department. There cannot be a mechanical application of the principles of natural justice in every case and the necessity of affording a hearing to an assessee, in order to comply with the rules of natural justice, must be examined on the facts of each case. No prejudice having been caused to the petitioner through the denial of a personal hearing since, although ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AND SRI. CYRIAC TOM For The Respondent : SRI. JOSE JOSEPH, SC, FOR INCOME TAX AND ADV. SRI. B. PRAMOD JUDGMENT The petitioner, an individual and an income tax assessee on the rolls of the Income Tax Officer, Ward-1, Kottayam, was engaged in timber business during the financial year 2015-16, corresponding to the assessment year 2016-17. The petitioner had sold about 13 adjacent agricultural plots to the M/s Believers Church, and while filing his return showed the sale consideration as agricultural income which was exempted from tax under the head of Capital Gains. The return submitted by the petitioner for the assessment year in question was subjected to scrutiny through a notice dated 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the factual aspects, disclosed by the petitioner in his various replies, to substantiate his claim for exemption. Pursuant to the inspection, some clarifications was sought for, which the petitioner furnished through Ext.P14 communication dated 24.12.2018. Thereafter Ext.P15 notice dated 28.12.2018 was issued to the petitioner giving a summary of the proposals of the department for completing the assessment in relation to the petitioner, and since the time limit for completing the assessment under the Income Tax Act was due to expire, the petitioner was asked to submit his explanation, if any, to the said proposal within a day, making it clear that if no reply was received, the assessment would be completed without any further notice. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is pointed out that the details sought were essentially for enabling the petitioner to establish that the exemption claim was in respect of agricultural income which would not fall for assessment under the head of Capital Gains. It is the stand of the department that the assessment order confirmed a demand of income tax on the petitioner only because he had not succeeded in substantiating his claim for exemption, and further, had not offered any satisfactory explanation for the unaccounted income detected, with any reliable documents and hence there was no prejudice caused to the petitioner on account of no hearing having been extended to him prior to passing the assessment order. It is, in particular, pointed out that, had the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new proposal by the department to fasten a liability on the petitioner. Accordingly, there was no obligation on the department to afford yet another hearing to the petitioner before passing the assessment order. In the instant case, the various queries raised by the department after perusing the reply given by the assessee to the notice issued under Section 143(2) of the Income Tax Act would clearly reveal that the department was only seeking for the documents that would substantiate the claim of the petitioner assessee for exemption in respect of a substantial portion of the income that was declared by him in the return. Ultimately, by Ext.P17 assessment order, all that the department did, was to deny the claim for exemption of the petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the petitioner, I direct that if the petitioner prefers an appeal against Ext.P17 order, before the appellate authority, within six weeks from today, then the appellate authority shall consider and pass orders in the appeal, on merits, after hearing the petitioner. In order to enable the petitioner to move the appellate authority, I direct that recovery steps for recovery of amounts confirmed against the petitioner by Ext.P17 assessment order/Ext.P18 demand notice shall be kept in abeyance for the above said period of six weeks. I also make it clear that nothing in this judgment shall stand in the way of the petitioner seeking a rectification of factual mistakes in Ext.P17 assessment order before the assessing authority. - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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