INCOME TAX ACT, 1961

Section 143

Assessment - Notices issued under sections 143(2) and 142(1) - Issue of show cause notice without considering reply of assessee - Validity

Petitioner had filed a return and his case was, however, picked up for scrutiny for carrying out assessment in accordance with the scheme framed under section 144B. Accordingly, a notice under section 143(2) was issued. This was followed by notices issued under section 142(1). Three notices were issued under said provision to which petitioner replied. A show-cause notice was issued by AO on 9-12-2022, without taking into account fact that petitioner had filed a reply on 8-12-2022. Via the Show-Cause Notice, dated 9-12-2022, the petitioner was given time to respond by 13-12-2022, up until 11:30 hours. Petitioner averred, that on 14-12-2022, it attempted to lodge reply to Show Cause Notice, dated 9-12-2022, an attempt that failed as e-proceedings window was closed. Consequently, petitioner claimed that, on 14-12-2022, an e-mail was forwarded. Since no response was received qua its email dated 14-12-2022, it made a request on 16-12-2022 to the concerned jurisdictional AO via e-mail address. This exercise, was repeated on 19-12-2022, when an e-mail of even date was forwarded. Despite these e-mails having been escalated to system, petitioner's grievance was not resolved. Aggrieved, petitioner filed this writ petition. Held: Although petitioner's reply dated 8-12-2022 was on record, a Show Cause Notice, dated 9-12-2022 was issued, without having regard to reply, therefore, impugned notices and order were quashed. There was clearly a failure on part of AO to adhere to directions contained in Clause N.1.3 of the Standard Operating Procedure (SOP) for Assessment Unit (AU) dated 3-8-2022; which required a minimum timeframe of seven days to be given to notice, i.e., petitioner.

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2021-12

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