P.T.Lee Chengalvaraya Naicker Trust Vs ITO (Madras High Court)
The Madras High Court disposed of a batch of writ petitions challenging faceless assessment orders passed under Section 144B of the Income-tax Act, 1961. Since all matters involved a common issue, they were heard together. The Court noted that Section 144B, introduced with effect from 01.04.2021, prescribes the procedure for faceless assessments, under which assessments are conducted without revealing the identity of the assessing officer.
The common grievance in most of the writ petitions was that final assessment orders had been passed without issuing a show-cause notice (SCN) or draft assessment order (DAO) as required under the faceless assessment procedure. In one petition, the issue was not the absence of an SCN/DAO, but whether sufficient opportunity had been granted after a show-cause notice was issued.
The respondents generally contended that adequate opportunities had been given through notices and questionnaires, that several petitioners had failed to respond fully or had sought repeated adjournments, and that the petitioners should pursue the statutory appellate remedy. In the batch of cases involving non-issuance of SCN/DAO, the respondents admitted that no SCN/DAO had been issued but argued that the omission was only a technical and curable procedural defect. They requested that the assessments be set aside and remanded so that SCNs/DAOs could be issued and fresh assessments completed.
