Thursday, April 25, 2024

Computerisation should not violate principles of natural justice, High Court sets aside the assessment order of the Income Tax Department

In District Bar Association, Supaul v. Assessment Unit, Income Tax Department, Patna High Court's bench of Chief Justice and Justice Harish Kumar set aside the assessment order of the Income Tax Department. The judgement observes, "We make it clear that the assessment order is set aside only on violation of the principles of natural justice and we have not looked at the merits of the assessment at all."

The petitioner was aggrieved with the assessment order passed on 27.03.2023 without providing adequate opportunity for being heard. The writ petition has been filed merely on the ground of violation of principles of natural justice. The request for adjournment made by the petitioner dated March 4, 2023 was filed in the portal of the Income Tax Department. Despite that, an assessment order was passed without affording any opportunity of hearing. 

Notably, the Department filed a response specifically contending that "no such request for adjournment was received in the portal of the Department." In compliance with the order of the Court, the petitioner filed a supplementary affidavit dated December 14, 2023, wherein "an auto generated mail issued from the portal of the Income Tax Department, that the request for adjournment for submission to notice under 147 is successfully submitted." The Department objected to it stating that the request for adjournment has to be uploaded in the assessment module of the “ITBA portal”, which has not received any request for extension of time. Although the Income Tax Department submitted that the adjournment request was not received in the ITBA portal but it did not disown the mail which was  issued by it. 

The Court observed that there is nothing to point out that suitable instructions were issued by the Department to the assesses to upload the adjournment requests in a particular portal. "The computerisation is to facilitate expeditious assessment and it cannot result in such gross violations of principles of natural justice." 

The judgement was authored by Chief Justice K. Vinod Chandran. The Court set aside the order dated March 27, 2023. Its direction dated April 23, 2024 reads: "The Income Tax Officer, Ward-3(4), Saharsa, who has filed the counter affidavit in the writ petition, shall on receipt of the certified copy of the judgment, facilitate the opening of the portal so as to enable filing of objections. The petitioner shall file the objections and after affording a personal hearing, the matter shall be considered afresh."

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