In W.P. No. 5328 of 2022-BOM HC- Failure on part of Tax Authorities to update their official portal, cannot be permitted to result in any sort of prejudice to assessee, says Bomaby HC while setting aside assessment order passed in gross violation of principles of natural justice
Justices Dhiraj Singh Thakur & Kamal Khata [19-01-2023]

Read Order: Kumar Agro Products Pvt. Ltd Vs. Deputy Commissioner Of Income Tax And Ors 

Tulip Kanth

Mumbai, January 25, 2023: The Bombay High Court has come to the aid of an assessee company which couldnot submit its response to a Notice on time due to the portal’s technical issue by setting aside the order of assessment and granting the Petitioner an opportunity to upload its response to the show cause notice.

The petitioner had approached the Division Bench of Justice Dhiraj Singh Thakur and Justice Kamal Khata challenging the order of assessment dated September 29, 2022 passed under Section 143(3) r/w Section 144B of the Income Tax Act, 1961 relevant to the assessment year 2020-21, primarily on the ground of violation of principles of natural justice.

The facts of the case suggested that the return of income was filed by the Petitioner on January 7, 2021. The return of income was selected for scrutiny assessment by the Respondents. Notice under Section 142(1) of the Act, was issued requiring the Petitioner to submit certain details, which the Petitioner claimed were submitted. 

The Respondents then issued a SCN whereby additions were sought to be made in the return of income. The Petitioner’s request for extension of time was allowed and time was extended till 11:00 am on 26th September, 2022.

It was the petitioner’s case that even when it was ready to upload its response to the show cause, the Respondents failed to update their portal to reflect the extended time up to September 26, 2022. The portal continued to reflect September 24, 2022 as the date by which the response had to be uploaded because of which the system did not permit the Petitioner to upload its response.

Referring to the screenshot of the portal which reflected the response date as September, 24, 2022, which in fact ought to have been reflected as September 26, 2022 and considering the fact that order of assessment was passed without the response of the Petitioner, the Bench said, “The Petitioner was thus denied an opportunity of submitting its response as also was denied an opportunity of being heard, which was otherwise to be granted even as per the show cause notice dated 22nd September, 2022.”

“The failure on the part of the Respondents to update their official portal, cannot be permitted to result in any sort of prejudice to the Petitioner, Notwithstanding the fact that an order of assessment has been passed in gross violation of principles of natural justice”, the Bench further remarked.

Thus, allowing the petition, the Bench set aside the order of assessment.

The Bench also directed that a fresh order be passed, after the Petitioner is granted an opportunity to upload its response to the show cause notice for which the requisite portal may be made available to the Petitioner and an opportunity of being heard may also be provided to the Petitioner.