INCOME TAX ACT, 1961

Sections 147 & 148

Reassessment - Validity - Non-provision of personal hearing to assessee as sought for by him -

Assessee was an employee of a company, namely, 'N'. Assessee filed a writ petition challenging validity of a reassessment order contending that AO issued a notice under section 148 for reopening of assessment and in reply, the assessee specifically requested to furnish reasons for reopening of the assessment. It was further submitted that the reasons were furnished long after on 28-2-2022, i.e., about one month before the time for completing the assessment got lapsed on 31-3-2022. It was further submitted that on 12-3-2022, the AO passed an order disposing the assessee's objections for reopening the assessment and thereafter, the AO issued a draft show-cause notice under section 144. By which time, the assessee also furnished a certificate from bank, whereby, it was confirmed that the assessee was not an account holder of alleged bank account and that the said account stood in the name of 'N'. Moreover, it was submitted that the assessee also requested for a personal hearing and despite that, the AO straight away proceeded to pass a speaking order. Held: Reassessment order was not sustainable, particularly, in the light of the fact that assessee specifically requested for a personal hearing in response to a notice issued under section 148 on 15-3-2022. That apart, the assessee asked the AO to provide reasons to reopen assessment, which were not furnished earlier and the same were furnished only after disposing of assessee's objections for reopening of the assessment. Further, the reasons for reopening of the assessment also did not make it clear as to whether alleged amount was deposited in the assessee's account or in the account of 'N'. Consequently, impugned reassessment was set aside and matter was remanded to AO to pass a speaking order.