Gujarat High Court
Bharatkumar Rajendraprasad Dave vs Additional/Joint/Deputy/Assistant ... on 9 January, 2023
Author: Sonia Gokani
Bench: Sonia Gokani
NEUTRAL CITATION
C/SCA/16041/2021 ORDER DATED: 09/01/2023
undefined
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 16041 of 2021
==========================================================
BHARATKUMAR RAJENDRAPRASAD DAVE
Versus
ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME
TAX/INCOME TAX OFFICER
==========================================================
Appearance:
MR B S SOPARKAR(6851) for the Petitioner(s) No. 1
for the Respondent(s) No. 1
M R BHATT & CO.(5953) for the Respondent(s) No. 1
==========================================================
CORAM:HONOURABLE MS. JUSTICE SONIA GOKANI
and
HONOURABLE MR. JUSTICE SANDEEP N. BHATT
Date : 09/01/2023
ORAL ORDER
(PER : HONOURABLE MS. JUSTICE SONIA GOKANI) The present petition concerns the A.Y.2018-2019 where the challenge essentially is to the non-availment of an opportunity while finalising the assessment order.
2. This Court on 26.10.2021 while issuing notice for final disposal passed the following order :
"1. The petitioner is before this Court under Article 226 of the Constitution of India seeking to challenge the order dated 29.09.2021 passed by the respondent under Section 143(3) read with Section 144 B of the Income Tax Act, 1961 assessing the total income of the petitioner for the Assessment Year 2018-2019 Page 1 of 7 Downloaded on : Sun Sep 17 20:37:54 IST 2023 NEUTRAL CITATION C/SCA/16041/2021 ORDER DATED: 09/01/2023 undefined by adding the huge amount without availing an opportunity of hearing.
2. According to the petitioner, Assessing Officer, while passing the Assessment Order, has disregarded the binding precedents, the required statutory requirements and the entire addition made of Rs.11.47 Crore (rounded off) is without issuance of the show cause notice and providing of the draft assessment order.
3. We have heard the learned advocate, Mr.Bandish Soparkar appearing for the petitioner, who has urged that this is the process case as the hearing had been point blank refused by a communication dated 23.09.2021. The entire statutory requirement is blatantly not followed and this itself is the ground for the Court to intervene. He has relied upon the decision of the Bombay High Court in case of Mantra Industries Limited vs. National Faceless in support of his submission.
4. Issue Notice for final disposal, returnable on 23.11.2021. Interim relief in terms of para 7(b) is granted till the returnable date. "7(b). pending the admission, hearing and final disposal of this petition, to stay implementation and operation of the order at Annexure-'A' to this petition, notice of penalty at Annexure'V' to this petition and stay recovery of tax for Assessment Year 2018-2019."
5. Over and above the regular mode of service, direct service is also permitted through speed post as well as e-mode."
Page 2 of 7 Downloaded on : Sun Sep 17 20:37:54 IST 2023NEUTRAL CITATION C/SCA/16041/2021 ORDER DATED: 09/01/2023 undefined 3, The petitioner is an Orthopaedic Surgeon running a Spine Hospital. He filed his return of income on 1.11.2018 offering Rs 5,95,73,730/- as his total income. His case was selected for scrutiny under Section 143 of the I.T Act and various correspondences took place.
4. It is the grievance on the part of the petitioner that without show cause notice cum draft assessment order being served upon the petitioner, the respondent passed the order of assessment on 29.9.2021 assessing the income of the petitioner to be at Rs 17,73,98,364/- .
4.1 The serious grievance on the part of the petitioner is that he has been deprived of the draft assessment order as also the opportunity of personal hearing, and the same could have been availed had the draft assessment order along with the show cause notice was issued. The demand notice under Section 156 of the I.T Actas well as the penalty under Section 274 read with Section 270 A of the Act had been made.
5. The respondent appeared and filed affidavit-in- reply denying all allegations. It is not in dispute that on 27.9.2021, the show cause notice was issued to the assessee to comply with the same on 28.9.2021. Since Page 3 of 7 Downloaded on : Sun Sep 17 20:37:54 IST 2023 NEUTRAL CITATION C/SCA/16041/2021 ORDER DATED: 09/01/2023 undefined the case was getting time barred on 30.9.2021. The last reply was filed by the assessee on 28.9.2021. The assessee's reply of 28.9.2021 was considered and after taking into account, the processing time taken for getting approval online system under the faceless assessment scheme. The time consumed in sending the show cause notice cum draft assessment order. The personal hearing and issuance of final order after getting approval from the higher authority the final order has been passed. This entire scenario was on account of the inordinate delay on the part of the petitioner in filing the submissions.
6. It is further contended that due to the prolonged partial submissions on the part of the assessee for the information is called for and the time taken by the petitioner till the fag end of the limitation date of the case, sending the draft assessment order to the Range Head, Risk Unit, Review Unit under faceless assessment scheme, and availability of limited time had resulted into non-issuance of show cause notice cum draft assessment order.
7. We have heard both the sides extensively. We have put forward their submissions to substantiate their pleadings.
Page 4 of 7 Downloaded on : Sun Sep 17 20:37:54 IST 2023NEUTRAL CITATION C/SCA/16041/2021 ORDER DATED: 09/01/2023 undefined
8. The sole issue that requires the consideration is non-service of show cause notice cum draft assessment order before finally making an assessment on 30.9.2021.
9. It is not being disputed by the respondent that there was absence of any show cause notice cum draft assessment order as is otherwise required under the law. The defence that has been raised is that the entire process would have taken a long time. It was not possible to meet with the time line of 30.9.2021 and otherwise, requisite opportunity had already been granted.
9.1 It is thus quite clear that except the reply of the assessee which the respondent construe to be the opportunity as required to be granted under the law he has not been availed much less the offering of the personal hearing and issuance of the draft order after getting approval of the higher authority. The Assessing officer was promoted during April 2021 and therefore, was holding an additional charge in addition to his substantial charge with minimal supporting staff and without adequate infrastructural facilities from July 2021 and that hardly is the ground for non-compliance of the provision of the law.
Page 5 of 7 Downloaded on : Sun Sep 17 20:37:54 IST 2023NEUTRAL CITATION C/SCA/16041/2021 ORDER DATED: 09/01/2023 undefined An attempt is made to explain that the AO needed to complete many time barring assessment cases and the penalty cases in both his charges and the above was not the only case. These according to us are very lame excuses and surely not expected to be given by the respondent authority. It may explain as to why the opportunity was not given but fairness on the part of the authority is always expected rather than prolonging the litigation by conceding to the fact that it had not been in a position to abide by the statutory requirement. The least it could have done was to accept the aspect by seeking the permission to freshly initiate such action. This is not the case of failure of the system or any other shortcomings which had hampered the officer not allow his request. It is he who was short of time as the time limit of assessment was getting over by 30.9.2022. Even if non-issuance of show cause notice along with the draft assessment order was neither willful nor wanting the fact remains that the it must be supplied and hence it is clear and unequivocal act of breach of principles of natural justice warranting interference at the hands of the Court.
10. Resultantly, the order of assessment passed in the instant case on 29.9.2021 is quashed and set aside along with the consequential setting aside of the Page 6 of 7 Downloaded on : Sun Sep 17 20:37:54 IST 2023 NEUTRAL CITATION C/SCA/16041/2021 ORDER DATED: 09/01/2023 undefined penalty. The respondent is permitted to pick up the threads from where it was left by denying the opportunity to the petitioner. Let the sufficient opportunity as contemplated under the law be given after serving the show cause notice cum draft assessment order. The same shall be given in four weeks' period, and thereafter the statutory period shall be adhered to for the rest of the procedures.
11. The petitioner has ensured to co-operate and shall not seek any adjournment unless inevitable.
12. The petition is in the above terms allowed with no order as to costs.
(SONIA GOKANI, J) (SANDEEP N. BHATT,J) MARY VADAKKAN Page 7 of 7 Downloaded on : Sun Sep 17 20:37:54 IST 2023