Punjab And Haryana High Court Quashes Income Tax Demand Notice For Non-Compliance Of Section 144-B Procedure

The Punjab and Haryana High Court has quashed the assessment order and consequent notice of demand and penalty proceedings due to non-compliance of procedure enshrined in clauses (vii) and (viii) of Section 144-B(6) of the Income Tax Act.

The bench of Justice Ritu Bahri and Justice Manisha Batra observed that the assessment of the orders and demand notices had been passed in violation of principles of natural justice.

The petitioner contended that his case was fixed for March 21, 2023, at 11 a.m. through VC, but due to the non-availability of the petitioner’s counsel, a request to reschedule the VC was submitted by the petitioner at 7 a.m. on March 21, 2023. However, the petitioner did not receive any response from the respondent, and the request showed as "open" on the e-filing portal of the petitioner. The respondent closed the e-submission facility in the account of the petitioner on March 21, 2023.

The petitioner then raised a grievance on the e-filing portal on March 21, 2023, and a resolution to the grievance was provided on March 23, 2023. This information was even forwarded by respondents to the concerned assessment unit.

However, without affording an opportunity of hearing to the petitioner, the order and notices have been issued.

The court allowed the petition and set aside the demand notice.

Case Title: Arihant Roller Flour Mills Versus National Faceless Assessment Centre

Citation: 2023 LiveLaw (PH) 83

Case No.: CWP-7239-2023

Date: 26.04.2023

Counsel For Petitioner: Nikhil Goyal

Counsel For Respondent: Gauri Neo Rampal

Click Here To Read The Order