Quashed the Assessment Order passed without providing an opportunity of hearing to Assessee

The Madras High Court has quashed an assessment order issued by the Assistant Commissioner of Income Tax. The court found that the order was passed without giving the taxpayer adequate time to respond to a show cause notice and without providing an opportunity for a personal hearing. This violated the principles of natural justice. The case has been remitted back for a fresh order, ensuring the taxpayer is given a proper chance to reply and be heard.

In Jaffaorulla Syeaadunnishaa v. The Assistant Commissioner of Income Tax, Income Tax Circle 2(1) Trichy, 3rd Floor, Trichy Main Building, Williams Road, Cantonment, Tiruchirappalli-620 001. W.P (MD) No.1972 of 2020 and WMP(MD)Nos.1645 and 1646 of 2020, Jaffaorulla Syeaadunnishaa ("the Petitioner") challenged an assessment order dated December 24, 2019 ("Assessment Order") under Section 144 of the Income tax act ("the IT Act") for being in violation of principles of natural justice and against the Circular dated December 26, 2019.

The Petitioner was issued a show cause notice dated December 5, 2019 ("SCN") by the Assistant Commissioner of Income Tax, Tiruchirappalli ("the Respondents") asking for details including the details for the assessment year 2016-2017 and thereafter Assessment Order was passed.

The Petitioner contended that the Respondent has arbitrarily passed the assessment order on December 24, 2019 without granting the time to Petitioner to file reply to SCN as per the direction of the Directorate of Income Tax granting time upto December 29, 2019.

The Hon'ble Madras High Court set aside the Assessment Order and held that the Assessment Order was wrongfully passed by the Respondent on December 24, 2019 without granting appropriate time to the Petitioner to file a reply within the time limit of December 29, 2019 as per the direction of the Directorate of Income Tax which is a clear violation of principle of natural justice. Further, the Petitioner was not even given an opportunity of personal hearing.

Remitted back the matter to the Respondent to pass fresh order after giving an opportunity for making detailed reply and after affording opportunity of personal hearing to the Petitioner.