“Only Three Days Were Given To Assessee To Respond To Show Cause Notice”: Kerala High Court Sets Aside Reassessment Order
The Kerala High Court set aside an order in reassessment proceedings that was issued without providing the assessee an opportunity to respond to the show cause notice. The Bench of Justice Gopinath P. observed that “the show cause notice was issued on 12-03-2024, giving only three days' time to the assessee to respond, and the order was issued on 20-03-2024………...
The Kerala High Court set aside an order in reassessment proceedings that was issued without providing the assessee an opportunity to respond to the show cause notice.
The Bench of Justice Gopinath P. observed that “the show cause notice was issued on 12-03-2024, giving only three days' time to the assessee to respond, and the order was issued on 20-03-2024……… one final opportunity can be given to the assessee to respond to the show cause notice”.
The assessee/petitioner claims that a show-cause notice was issued on 12-03-2024, with a deadline to respond by 15-03-2024. However, the order was passed on 20-03-2024, before the assessee had the opportunity to submit a reply. The assessee argued that this demonstrates undue haste on the part of the Assessing Authority, indicating that the matter was not properly considered. The assessee has challenged the order in reassessment proceedings for the assessment year 2018-2019 before the Kerala High Court.
The Income Tax Department submitted that the show cause notice was not the first show cause notice issued to the assessee and it was actually the final show cause notice issued to the assessee. It was further submitted that various opportunities had been granted earlier to the assessee and it cannot be said that the order was one issued in haste and without considering the reply filed by the assessee.
The bench observed that “while the Income Tax Department may be right in contending that the show cause notice was not the first opportunity given to the assessee and several earlier opportunities have been given to the assessee, it remains the fact that show cause notice was issued on 12-03-2024, giving only three days' time to the assessee to respond, and the order was issued on 20-03-2024…….”
Though, in the light of the earlier opportunities given to the assessee it cannot be said that the order was issued in haste, one final opportunity can be given to the assessee to respond to the show cause notice, added the bench.
In view of the above, the bench set aside the reassessment order directing the Assessing Authority to complete the assessment after providing one last opportunity to the assessee to respond to show cause notice and after affording an opportunity of hearing to the assessee.
Counsel for Petitioner/ Assessee: K. Krishna and Achyuth Menon
Counsel for Respondent/ Department: P.G. Jayashankar and G. Keerthivas
Case Title: Thottungal Padmanabha Das Sujith v. The Additional/Joint/Deputy/Assistant Commissioner Of Income Tax/Income Tax Officer, Assistant
Case Number: WP(C) NO. 22380 OF 2024
Citation: 2024 LiveLaw (Ker) 628