Assessee can’t insist for physical hearing as same isn’t permissible under faceless assessment scheme: HC

Case Details: Gurumukh Ahuja v. Income-tax Department - [2022] 142 taxmann.com 275 (Madhya Pradesh)

Judiciary and Counsel Details

• • Sheel Nagu & Maninder S. Bhatti, JJ.
  • G.N. Purohit, Sr. Adv. & Nitin Agrawal, Adv. for the Petitioner.
  • Sanjay Lal, Adv. for the Respondent.

Facts of the Case

Assessee was an individual and regular income tax assessee. He received notice by which he was called upon to provide details pertaining to his business activities.

The assessee submitted all the information called for and also demanded the opportunity of a personal hearing before the issuance of the final order. However, Assessing Officer (AO) passed the final order without giving the opportunity of personal hearing to the assessee. AO issued notice of demand and notice of penalty as well.

Assessee challenged the assessment order by filing writ petition before the Madhya Pradesh High Court.

High Court Held

The High Court stated that the opportunity for a personal hearing is provided under section 144B(7)(vii), however, it does not postulate that hearing should be ‘physical’. A perusal of notices issued to the assessee makes it clear that by virtue of the Faceless Assessment Scheme, there was no provision for physical hearing and physical hearing was not permissible.

The assessee was well advised by the AO to take recourse to the virtual mode of hearing through the guidelines relating to the Faceless Assessment Scheme. However, the assessee didn’t opt for it and still kept on insisting on physical hearing.

Accordingly, since the request for personal hearing made by the assessee was misconceived as Section 144B(7)(vii) does not postulate a physical hearing, the writ petition filed by him was to be dismissed.

List of Cases Referred to

• • Mantra Industries Ltd. v. National Faceless Assessment Centre (NFAC or NeAC) [2021] 131 taxmann.com 165/283 Taxman 459/[2022] 441 ITR 467 (Bom.) (para 9)
  • Metharam Pinjani v. Income-tax Department [2022] 137 taxmann.com 148/287 Taxman 16 (MP) (para 11)
  • Sabic India (P.) Ltd. v. Union of India [2021] 126 taxmann.com 157/280 Taxman 158/434 ITR 563 (Delhi) (para 11)
  • CIT v. Vijaybhai N. Chandrani [2013] 35 taxmann.com 580/217 Taxman 138/357 ITR 713 (SC) (para 11).