Personal Hearing Must Be Given When Specifically Asked By Assesee Before Passing Order U/S 148A(d) Income Tax Act: Allahabad High Court
The Allahabad High Court has held that when the assesee has asked for opportunity of personal hearing and relevant documents, both should be provided prior to passing orders under Section 148 A(d) of the Income Tax, 1961. Petitioner and his brother run separate businesses, however they acquired a shop together. The shop was subjected to search and seizure under the Income Tax Act...
The Allahabad High Court has held that when the assesee has asked for opportunity of personal hearing and relevant documents, both should be provided prior to passing orders under Section 148 A(d) of the Income Tax, 1961.
Petitioner and his brother run separate businesses, however they acquired a shop together. The shop was subjected to search and seizure under the Income Tax Act where certain loose documents and sheets were seized. Subsequently, petitioner was issued notice under Section 148A(b) based on certain Audit Objections.
In his reply, petitioner specifically asked for a copy of the Audit Objection and an opportunity of personal hearing. However, order under Section 148A(d) was passed without supplying the petitioner a copy of the Audit Objection and without granting any opportunity of personal hearing. Subsequent notice under Section 148 was also issued.
Challenging the order under Section 148A(d) and the notice under Section 148, counsel for petitioner relied on the guidelines issued by the Central Board of Direct Taxes for issuance of reassessment notices under Section 148 dated 01.08.2022 and clarified on 22.08.2022. it was argued that the guidelines specifically mandate that a personal hearing should be provided in cases where reassessment notice is issued and the assesee has requested for the same.
Counsel for respondent relied on Vivek Saran Agarwal Vs. Union of India and 3 Others, where the Allahabad High Court held that a detailed hearing is not necessary at the stage of issuance of notice under Section 148A(b) and prior to passing of order under Section 148A(d).
Without going into merits of the case, the Court held that no opportunity was given in terms of the Circular dated 22.08.2022.
The Court opined that “the reply of the petitioner had specifically asked for documents to be supplied including complete case proceedings and for personal hearing, which was not given. The Assessing Officer has acted in undue haste.”
The bench of Justice Sangeeta Chandra and Justice Shree Prakash Singh set-aside the notice and order issued against the Petitioner on the ground that the relevant documents relating to the information i.e., audit objection was not provided to the Petitioner as well as no opportunity of personal hearing was provided to the petitioner before passing the order under Section 148 A(d), despite the Petitioner specifically asking for the same vide his objections/reply to the show cause notice under Section 148 A(b) of the Income Tax Act.
Accordingly, the Court set-aside/quashed notice under Section 148 and order under Section 148 A(d) of the Income Tax, 1961 issued by the Authorities.
Case Title: Gyan Prakash Rastogi vs. Union of India [WRIT TAX No. - 195 of 2024]
Counsel for Petitioner: Aakash Prasad, Himanshu Singh, Areeb Uddin Ahmed
Counsel for Respondent: Varun Pandey, Neerav Chitravanshi, Kushagra Dikshit
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