Notice Issued to Assessee Calling Forth Certain Details Couldn’t Be Deemed As Grant of Hearing Opportunity | HC

Case Details: Antony Alphonse Kevin Alphonse vs. ITO - [2023] 157 taxmann.com 300 (Madras)

Judiciary and Counsel Details

• • Krishnan Ramasamy, J.
  • G. Baskar for the Petitioner.
  • R.S. Balaji, Senior Standing Counsel & Ms S. Premalatha, Junior Standing Counsel for the Respondent.

Facts of the Case

The assessee filed its return of income for the relevant assessment year. Subsequently, the case was selected for scrutiny, and a notice under Section 143(2) was issued, followed by a show-cause notice calling upon the assessee to file a reply. In response, the assessee made submissions along with certain supportive documents.

Later, the Assessing Officer (AO) passed an assessment order without considering the documents. Against such an order, the assessee filed writ petition filed before the Madras High Court. The High Court remitted the matter to AO for passing a speaking order after considering the objections filed by the assessee.

Assessee contended that AO passed the assessment order second time without providing an opportunity for a personal hearing. However, AO submitted that the assessment order was passed only after sufficient opportunities were afforded.

The matter was brought before the Madras High Court again.

High Court Held

The High Court held that the earlier assessment order was passed in violation of principles of natural justice. Accordingly, the AO ought to have granted the petitioner an opportunity for a personal hearing before passing the second assessment order.

It was not in dispute that no notice subsequent to the receipt of reply from the assessee was issued. Further, the AO produced no evidence to show that the notice for a personal hearing was issued and the opportunity of hearing was granted before passing the assessment order.

The opportunities stated to have been provided to the assessee were only to call forth certain details from it. Those opportunities cannot be deemed opportunities for hearing the assessee since the question of allowing a personal hearing would come into the picture only after receiving reply or objections from the petitioner.

Considering that the assessee was not granted any opportunity for a personal hearing, the assessment order pass clearly violated the principles of natural justice, so the assessee’s appeal was allowed.