9911796707
TMI Blog2025 (1) TMI 1357X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment order and not a draft assessment order.
As based on a draft assessment order, the Respondents were not justified in issuing the impugned demand notice dated 30 March 2021, penalty order dated 16 March 2022, and recovery notices dated 30 December 2021. Accordingly, all these are liable to be set aside and are hereby quashed and set aside.
Since we have held that the order was only a draft assessment order, it cannot be set aside. However, based on this draft assessment order, the Respondents could not have made any tax, or penalty demands or sought recovery of tax or penalty. X X X X Extracts X X X X X X X X Extracts X X X X ..... ned Counsel for the Petitioner, submits that the order dated 30 March 2021 (Exhibit B, pages 50 to 57 of the paper book) is only a draft assessment order and not a final assessment order. He submits that based on such a draft assessment order, the impugned demand notice dated 30 March 2021, the impugned penalty order dated 16 March 2022, and the consequential recovery notice dated 30 December 2021 could never have been issued. 6. Mr Kanth, in the alternative, submitted that if the order dated 30 March 2021 (Exhibit B) is to be regarded as a final assessment order (which, according to him, it is not), then it must be set aside because it was never preceded by any draft assessment order, which is the requirement under the law. 7. On the abo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above-quoted Clause 8 clarifies that the order dated 30 March 2021 was only a draft assessment order. Clause 8 explicitly refers to the provisions of Section 144C (2) of the Income Tax, 1961 and calls upon the assessee to either accept the variations mentioned in the order or to file objections before DRP and before the issuing authority within 30 days of receiving this order. Clause 8 concludes by stating that if no objection is received within time, assessment shall be completed "on the basis of this draft order". 12. Besides, in paragraphs 3, 4.5 and 5.3.3 of the order dated 30 March 2021, there is a reference to 'proposed additions'. This is another circumstance showing that the order dated 30 March 2021 is nothing but a draft assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Petitioner the mandatory procedure as discussed in above was not followed by the Faceless Assessing Officer (FAO) and instead of passing the Draft assessment order, the FAO has passed Final Assessment Order i.e. order u/s. 143 (3) r.w.s 143 (3A) & 143(3B) of the Act therefore, the consequential Demand Notice, Penalty order and Recovery letter are issued. In this regard, it is to state that the FAO has prepared the Draft Assessment Order, which was pending for signature before the NaFAC. Subsequently, the FAO has passed Final Assessment Order." 14. The above statements virtually admit that mandatory procedures were not followed but seek to apportion the blame on the faceless assessing officer. In any event, based on the above statements re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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