Less than 12 hours given to reply SCN: HC Quashes assessment order made without giving opportunity of being heard

In the matter of Dineshkumar Chhaganbhai Nandani Versus Income Tax Officer, ITO WD 2(1)(1), RKT, the Honorable Gujarat High Court has quashed an assessment order made on the petitioner without giving him an opportunity of being heard. In this case, a show cause notice (SCN) cum draft assessment order was issued on 29.03.2022 and the petitioner was asked to submit his reply within less than 12 hours.

Gujarat High Court Order:

14. In the present case, as discussed hereinabove, it is the specific case of the petitioner that a show cause notice-cum-draft assessment order was issued on 29.03.2022 and petitioner was asked to submit his reply within less than 12 hours. Though the petitioner submitted reply, it is the specific case of the petitioner that the respondents have failed to grant adequate opportunity of hearing/ an opportunity to defend was not given to the petitioner assessee.

We have gone through the reply dated 29.03.2022 submitted by the petitioner, copy of which is placed on record at page 82 of the compilation. A specific request was made by the petitioner to the respondent that particular documents/details be supplied for cross verification and an opportunity to cross examine one Mr. Saurabh Kathwadia be given to the petitioner. However, it is not in dispute that the said documents as asked for by the petitioner were not supplied to him nor any opportunity of cross examination of the aforesaid person was granted to the petitioner. Even otherwise, within less than 12 hours, it is difficult for the petitioner to submit complete reply to the respondents.

15. It is contended by learned Standing Counsel for the Revenue that by not granting such adequate opportunity to the petitioner, no prejudice is caused to the petitioner as the respondents issued various notices to the petitioner to which the petitioner did not reply. However, we are of the view that when the show cause notice-cum-draft assessment order is issued to the petitioner, reasonable/adequate opportunity was required to be given to him. In the present case, adequate opportunity was not given to the petitioner and therefore only on this ground the petition deserves to be allowed.

16. Thus, in view of the aforesaid findings recorded by us, the decision upon which reliance is placed by learned Standing Counsel for the Revenue i.e. the decision in Nileshkumar Bhupendrabhai Shah (supra) would not be applicable to the facts of the present case.

17. In view of the aforesaid discussion, the petition is allowed. Accordingly, impugned assessment order dated 31.03.2022 is hereby quashed and set aside. This, however, would not preclude the respondent in initiating any action from the stage from where it has been left. Let the petitioner cooperate in the same. It is clarified that this Court has not examined the merits of the case of the petitioner. Rule is made absolute accordingly.

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