Spectrum Logistics Private Limited vs Assistant Commissioner Of Income Tax, Circle24(1) & Ors

A notice dated October 16, 2017 issued under Section 148 of the Income Tax Act, 1961 initiating proceedings for re-assessment under Section 147 of the Act of 1961 for the assessment year 2013-2014 and the order dated December 10, 2018 passed in such proceeding are under challenge in the present writ petition.

Learned Additional Advocate General appearing for the petitioner submits that, the proceedings stands vitiated by breach of the principles of natural justice. The authorities did not afford the petitioner a hearing despite the order of the Hon'ble High Court dated December 3, 2018 passed in WP No.23521(W) of 2018. He submits that, the order so passed in the writ petition filed by the petitioner is binding upon the parties. Such order directs the authorities to afford the petitioner a reasonable opportunity of hearing. Hearing not being granted, therefore, the impugned order stands vitiated by breach of principles of natural justice as also the order dated December 3, 2018. He draws the attention of the Court to the various infirmities in the proceedings, such as, an audit report being relied upon by the authorities when the same did not form part of reasons for the purpose of invoking the provisions of Section 148 of the Act of 1961. He submits that, opportunity to deal with such report was not given to the petitioner. The authorities cannot introduce the audit report when it did not form part of the original reasons for commencement of the proceedings.

The respondents are represented.

This is the second round of litigation in respect of the same assessment year for the purpose re-assessment under Section 147 of the Act of 1961. The first writ petition being WP No.23521(W) of 2018 was disposed of by an order dated December 3, 2018, inter alia, requiring the respondents to afford a reasonable opportunity of hearing to the petitioner prior to the passing of the final order. It is admitted that, the respondents did not afford any opportunity of hearing to the petitioner before passing of the impugned order dated December 10, 2018. On such ground alone, the impugned order is set aside. The directions contained in the order dated December 3, 2018 is binding upon the parties. The authorities will act in terms of such order.

So far as the audit report is concerned, it would be sufficient to say that, if, the authorities seek to rely upon any evidence in course of hearing, it will inform the petitioner of the evidences that it seeks to rely upon in such proceedings so that the petitioner is in a position to deal with the same, in accordance with law.

It is submitted on behalf of the respondents that, the period of limitation expires on December 31, 2018.

In such circumstances, the authorities will not grant any adjournment to any of the parties and will proceed to dispose of the proceedings as expeditiously as possible.

WP No.25270(W) of 2018 is disposed of.

No order as to costs.

Urgent certified website copies of this order, if applied for, be made available to the parties upon compliance of the requisite formalities.