Buli Chemicals India Pvt. Ltd v. Assessment Unit Income Tax Dept. & Ors

Digitallysigned bySHAMBHAVISHAMBHAVINILESHNILESHSHIVGANSHIVGANDate:2023.08.3012:22:01+0530 IN THE HIGH COURT OF JUDICATURE AT BOMBAYCIVIL APPELLATE JURISDICTIONWRIT PETITION NO. 10642 OF 2023 Buli Chemicals India Pvt. Ltd.VersusAssessment Unit Income Tax Dept. & Ors. … Petitioner… Respondents Mr. Madhur Agrawal i/by Mr. Atul K Jasani, for Petitioner.Mr. Ajeet Manwani with Samiksha Kanani for Respondent-State. CORAMK. R. SHRIRAM &DR. N. K. GOKHALE, JJ.DATED:28th August 2023 P.C. : 1.Petitioner is impugning the assessment order dated 27[th] May2023 passed under Section 143(3) read with Section 144B of theIncome-tax Act, 1961 (“Act”) for the Assessment Year 2020-21along with consequential demand notice and penalty notice, bothdated 27th May 2023. 2.Mr. Agrawal states that Petition was served on 26[th] June2023. No reply has been filed till date. 3.In view of the facts and circumstances of the case, we do notfeel it necessary to go into the details and the Petition is beingdisposed at the stage of admission itself. 4.Petitioner received a notice dated 12th May 2023 callingupon Petitioner to show cause as to why variation mentionedtherein should not be made to the returns filed by Petitioner. Thenotice has been digitally signed on 22nd May 2023 at 13:21:58IST. Petitioner has been given time to respond by 12:41 hour on23rd May 2023, i.e., less than 24 hours. 5.On 24th March 2023, Petitioner addressed communicationto Faceless Assessment Unit requesting for time to prepare detailsand documents and submit it by 10th June 2023 since Petitionerhas been taken over by new management and consequently therewas change in Board of Directors also. Despite that assessmentorder came to be passed on 27th May 2023 making variationsmentioned therein. It is also recorded in the impugned assessmentorder that Petitioner was given time to give final reply to the show-cause notice but Petitioner sought adjournment on 20th June 2023and adjournment cannot be granted due to paucity of time. There is no explanation as to what was the urgency or why there waspaucity of time because time for completing assessment wasexpiring on 30th September 2023. 6.Mr. Manwani submitted that Petitioner had been givenopportunity earlier as recorded in paragraph 2 of the impugnedorder but Petitioner did not respond. Mr. Agrawal in responsestated that Petitioner was undergoing transition as mentioned inthe adjournment request noted earlier. Mr. Agrawal states thatPetitioner was always and is ready and willing to give within twoweeks from today explanation to show-cause as to why variationshould not be made. 7.In our view, as the time limit was expiring only on 30thSeptember 2023, the Assessing Officer could have been considerateand granted time up to 10th June 2023. In any case, by giving lessthan 24 hours notice to respond to an Assessee, in our view, wouldviolate the principles of natural justice. There are various circularsissued and in other provisions that provide at least 7 days and upto 30 days notice has to be given. We feel the Assessing Officer, since there was no urgency, should have given minimum sevendays time to respond. 8.Therefore, we hereby quash and set aside the impugnedorder dated 27th May 2023 and consequential demand notice andpenalty notice also dated 27th May 2023 and remand the matter toFaceless Assessment Officer. Respondents are directed to open the portal to enablePetitioner to respond/file reply to the show-cause notice dated22nd May 2023 within two weeks of the portal being opened. Thereafter Assessing Officer may pass such order as hedeems fit in accordance with law within eight weeks. Before passing any order, personal hearing shall be given toPetitioner, notice whereof shall be communicated to Petitioner atleast five days in advance. If Assessing Officer is going to rely on any judgment or orderof the Tribunal or a Court, list thereof shall be made available to 8.Therefore, we hereby quash and set aside the impugnedorder dated 27th May 2023 and consequential demand notice andpenalty notice also dated 27th May 2023 and remand the matter toFaceless Assessment Officer. Respondents are directed to open the portal to enablePetitioner to respond/file reply to the show-cause notice dated22nd May 2023 within two weeks of the portal being opened. Thereafter Assessing Officer may pass such order as hedeems fit in accordance with law within eight weeks. Before passing any order, personal hearing shall be given toPetitioner, notice whereof shall be communicated to Petitioner atleast five days in advance. If Assessing Officer is going to rely on any judgment or orderof the Tribunal or a Court, list thereof shall be made available to Petitioner along with the notice of personal hearing, so thatPetitioner may deal with or distinguish the same. 9.We further make it clear that Assessing Officer shall not relyon any material or intimation or document, copy whereof is notmade available to Petitioner at least seven working days before thepersonal hearing. 10.The Petition disposed. 11.We clarify that we have not made any observations on themerits of the matter. (DR. N. K. GOKHALE, J.)(K. R. SHRIRAM, J.)