The Delhi High Court held that the requirement of giving reasonable opportunity of personal hearing is mandatory under Faceless Assessment Scheme.
Mr. Arvind Datar, senior counsel for the petitioner, Bharat Aluminium Company Ltd. stated that the impugned orders have been passed arbitrarily, without following the principles of natural justice and in gross violation of the scheme of faceless assessment under Section 144B of the Act, inasmuch as even after the ‘Nil’ or ‘Null’ variation proposed in the show cause notice, additions had been made to the assessed income in the draft assessment order as well as in the impugned final assessment order.
Mr. Datar further contended that respondent in the draft assessment order as well as in the impugned final assessment order had proceeded to make additions to the assessed income on the false premise that the petitioner had not furnished relevant details / information in response to the statutory notice dated 19th August, 2021, issued under Section 142(1) of the Act. He stated that respondent No.3 had failed to appreciate that the petitioner was unable to upload the file due to technical glitches on the respondent’s own portal. He emphasised that the petitioner had still filed a reply to the notice that too within the due date vide email and, thus, there was no non-compliance on the part of the petitioner.
The division bench of Justice Manmohan and Justice Naveen Chawla held that The argument of the respondent/Revenue that personal hearing would be allowed only in such cases which involve disputed questions of fact is untenable as cases involving issues of law would also require a personal hearing. This Court is of the view that the classification made by the respondents/Revenue by way of the Circular dated 23rd November, 2020 is not legally sustainable as the classification between fact and law is not founded on intelligible differentia and the said differentia has no rational relation to the object sought to be achieved by Section 144B of the Act.
The court ruled that an assessee has a vested right to personal hearing and the same has to be given, if an assessee asks for it. The right to personal hearing cannot depend upon the facts of each case.
BHARAT ALUMINIUM COMPANY LTD. vs UNION OF INDIA & ORS.
CITATION: 2022 TAXSCAN (HC) 172
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