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TMI Blog2022 (11) TMI 780X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act itself provides for a procedure for the same, stands violated. The impugned assessment order Annexure P/1, dated 29.09.2022, for the aforesaid reason stands set aside/quashed and the matter stands remitted back to the assessment authority for a fresh consideration after giving an opportunity of personal hearing to the petitioner in accordance with Section 144B(6)(vii) (viii) of the Act of 1961. This court fixes 01.12.2022 for making the petitioner herself available before the Assessment Authority who by that time shall take necessary steps in ensuring all arrangements to be made for personal hearing to be given to the petitioner in respect of the assessment under challenge in the present writ petition. After giving a reasonable opportunity of hearing to the petitioner the authority may pass a fresh order. This court while allowing the writ petition has not entered into the merits of the assessment made by the assessing authority. The authority would be free to take an appropriate decision after hearing the petitioner. - Hon'ble Shri Justice P. Sam Koshy For the Petitioner : Shri S. Rajeshwara Rao and Shri Manoj Kumar Sinha, Advocates. For the Responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No.124 of 2022 (M/s Geekay Millennium Company Vs. Union of India Ors.) decided on 25.04.2022 and which was subsequently affirmed in Writ Appeal No.243 of 2022 vide order dated 07.07.2022. 5. Conscious of the fact that there is a remedy of appeal available to the petitioner, but this court at this juncture is entertaining the writ petition solitary on the ground whether in the course of passing of the impugned order the principle of natural justice was followed or not? There are enough judgments passed by the Supreme Court as also by this court which categorically lays down that in a case where principle of natural justice stands violated, the writ court does have the power to subject an order to judicial review to the extent of considering the violation of the principles of natural justice. 6. It would be relevant at this juncture to refer to the provisions of Section 144B(6)(vii) (viii) of the Act of 1961 in this regard which deals with the procedure which has to be followed in the course of the assessment being made under the provisions of Section 144B. For ready reference the two provisions is reproduced hereinunder: (vii) in a case where a variation is proposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e present case that failure to grant such opportunity to the petitioner has definitely caused prejudice to the petitioner. On the ground that the principles of natural justice have been violated, the impugned order of assessment is liable to be set aside. 9. Similarly, the Gujrat High Court in case of Dr. K.R. Shroff Foundation Vs. Additional/Joint/Deputy/Assistant Commissioner of Income Tax in Special Civil Application No.14779 of 2021, 2022(4)TMI 908(Gujrat High Court) in paragraphs 12 onwards referring to various decisions on the subject has held as under : 12. The decision of High Court of Orissa in case of Elite Education Society vs. Chairman, Central Board of Direct Taxes, Ministry of Finance, Department of Revenue and Others [W.P. (C) No. 18472 of 2021] shall be necessary to be referred to at this stage where the Court has held that the requirement for providing the hearing in terms of Section 144(B)(7)(vii) is not merely directory but mandatory one. 5. The requirement for providing such hearing in terms of Section 144 B (7) (vii) of the Income Tax Act, 1961 ('Act') is not merely directory, but a mandatory one. It reads as under:- 144-B (7) For the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dure under section 144B, lest the assessment would be non est. It further held that as per the provisions of Section 144(B), when the hearing has been envisioned and incorporated, it is imperative to observe the principles of natural justice as stipulated. 12.2. The High Court of Delhi in case of Sanjay Aggarwal vs. National Faceless Assessment Centre, Delhi [[2021] 127 taxmann.com 637 (Delhi)] held and observed thus:- 11.3. In this context, if one were to look at the relevant provisions, [which, for the sake of convenience are extracted hereafter], then, one would get a sense as to why the legislature has provided a personal hearing in the matter: 144B. Faceless assessment - (1) xxx xxx xxx (7) For the purposes of faceless assessment-- xxx xxx xxx (vii) in a case where a variation is proposed in the draft assessment order or final draft assessment order or revised draft assessment order, and an opportunity is provided to the assessee by serving a notice calling upon him to show-cause as to why the assessment should not be completed as per the such draft or final draft or revised draft assessment order, the assessee or his authorised representative, as the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to accord a personal hearing to the petitioner. As noted above, several requests had been made for personal hearing by the petitioner, none of which were dealt with by the respondent/revenue. 10. In yet another case in case of Omkar Nath Vs. National Faceless Assessment Centre Delhi (Earlier National E-Assessment Centre Delhi) Another, WPC No.6158 of 2021, decided on 10.03.2022, 2022(3)TMI 622 (Delhi High Court) on the same set of facts in paragraphs 4.1 to 4.3 has held as under : 4.1. Concededly, the AO passed the impugned assessment order, as indicated above, on 07.06.2021, without granting an opportunity to the petitioner of a personal hearing in the matter. 4.2. This being the position, clearly, the provisions of Section 144B(7)(vii) of the Act would apply in this case. 11. Further, the Andhra Pradesh High Court in case of Shri Mudar Sudheer Vs. Union of India, 2022(3)TMI 348 (Andhra Pradesh High Court) in writ petition No. 25113 of 2021, decided on 28.02.2022, has held as under : ..Having regard to the facts and circumstances of the case and considering the submissions made by the counsel, this court is of the view that the 2nd respondent passed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax authority is strongly entwined in the provisions on a request from an assessee unless it is absurd, strategised and/or intended to protract assessment etc. It would also emerge from various decisions, referred to above, ordinarily, such a request would not be declined. Judgments cited on behalf of petitioner referred to hereinbefore give exposition on significance and importance of principles of natural justice. 66. Section 144-B of the Income Tax Act, 1961 captioned 'Faceless Assessment' commences vide its sub-section (1) with a non-obstante clause and compulsively requires assessment u/ss 143(3) and 144 shall be by prescribed procedure contained in subsection (1) of section 144-B in the cases referred to in sub-section (2) thereof. 67. Sub-section (9) of section 144B declares that assessment made under section 143(3) or under section 144(4) referable to subsection (2) other than sub-section (8) on or after 1st day of April, 2021 shall be non est if such assessment is not made in accordance with the procedure laid down under section 144B. There is a telling/pronounced rigour, to follow the procedure under section 144B, lest the assessment would be non est. 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le of meaning must or shall in the light of the context. In fact, where a discretion is conferred upon a quasi judicial authority whose decision has civil consequences, the word may which denotes discretion should be construed to mean a command. 22. Consequently, this Court is of the view that the word may in Section 144B(viii) should be read as must or shall and requirement of giving an assessee a reasonable opportunity of personal hearing is mandatory. 13. Division Bench of Delhi High Court further in Sanjay Aggarwal Vs. National Faceless Assessment Centre Delhi, WPC No.5741 of 2021, decided on 02.06.2021, 2021(6)TMI-336, Delhi High Court, in paragraph 11.4, 12 and 12.1 has held as under: 11.4. A careful perusal of clause (vii) of Section 144B (7) would show that liberty has been given to the assessee, if his/her income is varied, to seek a personal hearing in the matter. Therefore, the usage of the word 'may', to our minds, cannot absolve the respondent/revenue from the obligation cast upon it, to consider the request made for grant of personal hearing. Besides this, under sub-clause (h) of Section 144B (7)(xii) read with Section 144B Signature No ..... X X X X Extracts X X X X X X X X Extracts X X X X
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