Facts of the Case

The petitioner, Mask Consultants Pvt. Ltd., challenged:

  • Notice dated 20.03.2023 issued under Section 148A(b)
  • Order dated 30.03.2023 passed under Section 148A(d)

The petitioner had filed a reply to the show cause notice under Section 148A(b), which was uploaded on the portal on 28.03.2023. However, the Assessing Officer proceeded on the assumption that no reply had been filed and passed the impugned order.

 Issues Involved

  1. Whether an order passed under Section 148A(d) is valid when the Assessing Officer fails to consider the reply filed by the assessee.
  2. Whether reassessment proceedings can continue based on an incorrect factual assumption that no response was filed.

 Petitioner’s Arguments

  • The petitioner contended that the impugned order was fundamentally flawed.
  • A reply to the notice under Section 148A(b) was duly filed and uploaded on the portal.
  • The Assessing Officer incorrectly recorded that no response had been filed, which is factually inaccurate.
  • Non-consideration of the reply violates principles of natural justice and renders the order invalid.

 Respondent’s Arguments

  • The Revenue chose not to file a counter-affidavit.
  • The matter was argued based on the available record.
  • No substantive rebuttal was provided against the petitioner’s contention regarding the filed reply.

 Court’s Findings / Order

  • The Court observed that the Assessing Officer proceeded on an incorrect factual premise that no reply was filed.
  • It was established that the petitioner had indeed submitted a reply within time.
  • Such non-consideration of the reply vitiates the order.

 Order:

  • The impugned order under Section 148A(d) was set aside.
  • The consequential notice under Section 148 was also quashed.
  • Liberty was granted to the Assessing Officer to pass a fresh order after:
    • Considering the petitioner’s reply
    • Granting a personal hearing to the petitioner

Important Clarification

  • The Court clarified that reassessment proceedings are not barred; however, they must be conducted in accordance with law.
  • Proper opportunity of hearing and due consideration of reply is mandatory before passing an order under Section 148A(d).
  • Mechanical orders based on incorrect facts cannot be sustained.

Link to download the order -https://delhihighcourt.nic.in/app/showFileJudgment/60810052023CW60602023_150420.pdf

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