Opportunity For Hearing Was Refused Due To Assessee's Failure To Click On Appropriate Button, Madras High Court Quashes Faceless Assessment Order

The Madras High Court has quashed the order as the opportunity for hearing was refused due to the assessee's failure to click on the appropriate button.

The bench of Justice Mohammed Shaffiq has observed that the personal hearing ought to have been extended, though the assessee might have failed to click on the appropriate button. The bench, while quashing the order, was directed to pass the order after affording the assessee a reasonable opportunity and personal hearing through a video conference.

The petitioner has challenged the assessment order for the assessment year 2018–2019 on the ground that, despite a specific request for personal hearing made by the petitioner and expressing his difficulty in availing himself of the opportunity of personal hearing through video conference, personal hearing was not granted, on the premise that the petitioner had not clicked on the Assessee Request Button/Icon and also not filled up the “Box of Agenda of the VC”.

The petitioner contended that the show cause notice was issued calling upon the petitioner to show cause as to why the assessment should not be completed as per the draft assessment order via notice dated May 17, 2021. The petitioner responded to the same along with relevant information and documents on May 22, 2021, which was also duly acknowledged by the respondent. In addition, on the very same day, the petitioner also made a request for a virtual hearing through "NaFAC.”.

On June 9, 2021, the petitioner was requested to make an application for hearing through video conference within 7 days of receiving the said communication. The petitioner, via a letter dated June 10, 2021, responded by stating that though he attempted to login to apply for a personal hearing through video conference, there was some problem with the web portal and he was unable to apply online. The letter was addressed to the Additional, Joint, Deputy, or Assistant Commissioner of Income Tax, National e-Assessment Centre, Delhi, who is the signatory to the letter, directing the petitioners to make a request for a virtual hearing.

The respondent department, on July 28, 2021, directed the petitioner to request to apply through NaFAC immediately for a virtual hearing. The petitioner, on July 28, 2021, once again reiterated his request for a personal hearing through video conference.

The department stated that the petitioner has not clicked on “Assessee Request” and also not filled up the box of agenda of the VC, and that was the reason why the personal hearing through video conference was not extended. Therefore,the department rrequested thatthe petitioner once again click on “Assessee Request” and seek a personal hearing, failing which it would be considered that video conference was not required.

The petitioner once again wrote a letter to the respondent on September 6, 2021, indicating that despite trying to login to apply for a personal hearing, they were unable to apply online.

The department stated via email that the petitioner may submit the replies through the e-filing portal as per the Faceless Assessment and Penalty Scheme so that the reply reaches the Faceless Assessing and Penalty Officer.

The petitioner stated via email that there is no option for “Box of Agenda of VC." On the very same day, the order of assessment was made.

The petitioner stated that mere failure on the part of the petitioner or assessee to click on the request button does not by itself indicate that personal hearing is not required, more so when the petitioner has expressed difficulty in making the request for personal hearing through a web portal.

The court directed that the assessment order be passed after affording the petitioner a reasonable opportunity and a personal hearing through video conference within a period of twelve weeks.

Counsel For Petitioner: R. Sivaraman

Counsel For Respondent: D. Prabhu Mukunth

Case Title: M/s.Bay-Forge Private Limited Versus Additional/Joint/Deputy/Assistant Commissioner of Income Tax/ Income Tax Officer, National Faceless Assessment Centre, New Delhi

Citation: 2024 LiveLaw (Mad) 162

Case No.: W.P.No. 24422 of 2021 and W.M.P.Nos. 25748 & 25752 of 2021 and 17955 of 2022

Click Here To Read The Order