Passing order without disposing of request of adjournment is violation of principles of natural justice: HC

Case Details: Sudev Industries Ltd. v. National Faceless Assessment Centre - [2021] 131 taxmann.com 74 (Delhi)

Judiciary and Counsel Details

• • Manmohan and Navin Chawla, JJ.
  • Ms. Kavita Jha and Udit Naresh, Advs. for the Petitioner. 
  • Puneet Rai, Sr. SC and Ms. Adeeba Mujahid, Jr. SC for the Respondent.

Facts of the Case

Assessee filed the writ petition before the Delhi High Court challenging the faceless assessment order, notice of demand, and notices of initiation of penalty proceedings.
The assessee submitted that the Assessment Order and the notices issued by the Assessing Officer were patently illegal, bad in law, issued without application of mind, and the same is against the principles of natural justice.
Assessee submitted that the adjournment application/letter filed by it wasn’t considered by Assessing Officer. The Chartered Accountant and his entire family were suffering from Covid-19 pandemic during the relevant time, and therefore, the assessee did not have adequate opportunity to file his response against the draft assessment order.
The Delhi High Court held that Section 144B(7) mandatorily provides for the issuance of a prior show cause notice and draft Assessment Order before issuing the final Assessment Order. The said section also provides for an opportunity of personal hearing, if requested, by the assessee.

High Court Held

In the instant case, the Assessing Officer had proceeded to pass the Assessment Order without dealing with the assessee’s request for adjournment. Thus, there had been a violation of the principles of natural justice.
Accordingly, the Assessment Order, notice of demand, and penalty notices are set aside. Further, the matter is remanded back to the Assessing Officer, who shall grant an opportunity of personal hearing by way of Video Conferencing after serving a copy of the draft Assessment Order, and thereafter pass a reasoned order in accordance with law.

List of Cases Referred to

• • Sanjay Aggarwal v. National Faceless Assessment Centre Delhi [2021] 127 taxmann.com 637/281 Taxman 282 (Delhi) (para 6).