SN Advance Ventures Private Limited Vs ACIT (Gujarat High Court)
The Gujarat High Court allowed the writ petition filed by SN Advance Ventures Private Limited challenging the assessment order dated 17.03.2026 passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961 for Assessment Year 2024-25.
The petitioner, a private limited company whose shareholders are individuals and citizens of India, had filed its return of income for AY 2024-25 on 20.10.2024 declaring a total income of Rs.1,05,91,080/-. The case was selected for scrutiny assessment, and the petitioner complied with notices issued by the respondents by filing replies from time to time.
The dispute arose after the petitioner received a Show Cause Notice dated 08.03.2026, which was issued on a Sunday and granted time only until 11.03.2026, amounting to three days for filing a response. The petitioner contended that the time granted was grossly insufficient and contrary to the settled principles requiring a reasonable opportunity. According to the petitioner, before it could even seek an adjournment, the proceedings were closed, depriving it of an effective opportunity to respond.
On 16.03.2026, the petitioner submitted a grievance bearing Acknowledgment No. 25223006 requesting an opportunity of hearing through video conference. It also emailed its grievance and reply on the same date. Despite this, the assessment order was passed on 17.03.2026 without considering the grievance or granting any hearing.
The petitioner submitted that the assessment order was liable to be quashed as it had been passed in violation of the principles of natural justice. In support of its case, reliance was placed on the Karnataka High Court decision in Sanjay Harichand Chugh Vs. Assessment Unit, (2026) 185 com 80 (Karnataka), where an assessment order was quashed after only six days had been granted to respond to a notice, and on a judgment of the Gujarat High Court dated 09.02.2026 in Special Civil Application No.1210 of 2023.
The Revenue opposed the petition, contending that the petitioner had filed its reply before the jurisdictional Assessing Officer even though the proceedings were pending before the Faceless Assessing Officer. It was submitted that replies could only be filed through the e-filing portal within the prescribed time and that the jurisdictional Assessing Officer had no authority to consider the grievance or reply.
After hearing both sides, the High Court noted that it was undisputed that the Show Cause Notice dated 08.03.2026 had been issued on a Sunday and granted only three days for filing a reply. The Court further noted that the petitioner had filed a grievance on 16.03.2026 specifically requesting an opportunity of hearing through video conference, but the Assessing Officer proceeded to pass the assessment order on 17.03.2026 without considering the grievance or granting a reasonable opportunity of hearing.
The Court held that granting only three days to file a reply could not be regarded as a reasonable opportunity. It observed that the Assessing Officer ought to have considered and decided the petitioner’s grievance regarding the inadequate time granted for responding. The Court also recorded that the petitioner had emailed both its grievance and reply on 16.03.2026, but these were not considered before passing the assessment order.
Accordingly, the High Court quashed and set aside the assessment order dated 17.03.2026 and remanded the matter to the Assessing Officer for fresh consideration. The Assessing Officer was directed to provide the petitioner with an adequate opportunity of hearing, including an opportunity of personal hearing if otherwise permissible in law, and thereafter pass a fresh order in accordance with law within twelve weeks from the date of receipt of the judgment. The writ petition was allowed and the Rule was made absolute.
Cases Discussed
- Sanjay Harichand Chugh Vs. Assessment Unit (Karnataka High Court), (2026) 185 com 80 (Karnataka)
- Special Civil Application No.1210 of 2023 (Gujarat High Court), Judgment dated 09.02.2026
FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT
1. Since the issues involved in the present writ petition are short, the matter is taken up for final hearing and is being decided by this judgment.
2. Rule. Learned Senior Standing Counsel Mr. Dev D. Patel waives service of notice of Rule on behalf of the respondents.
3. The present petitioner is prayed for quashing and setting aside of the assessment order dated 17.03.2026 passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961 (for short, “the Act”) for the Assessment Year 2024-25.
4. The petitioner is a private limited company. All its shareholders are individuals and citizens of India.
5. For the Assessment Year 2024-25, the petitioner filed its return of income on 20.10.2024 declaring a total income of Rs.1,05,91,080/-.
6. The case of the petitioner was selected for scrutiny assessment. Pursuant thereto, notices were issued by the respondents from time to time, which were duly complied with by the petitioner by filing appropriate replies.
7. The petitioner was issued a Show Cause Notice dated 08.03.2026, which was issued on a Sunday, granting time to respond only till 11.03.2026 i.e. merely three days. The said time period was grossly insufficient and contrary to the settled principles requiring a reasonable opportunity, ordinarily not less than seven days. Before the petitioner could even seek an adjournment, the proceedings came to be closed, thereby depriving the petitioner of an effective opportunity to file its reply.
8. Thereafter, on 16.03.2026, the petitioner filed a grievance bearing Acknowledgment No. 25223006, inter alia requesting an opportunity of hearing through video conference.
9. Learned advocate Mr.Jignesh P. Parikh, at the outset, has submitted that despite the petitioner having filed the aforesaid grievance on 16.03.2026, the respondents proceeded to pass the impugned assessment order dated 17.03.2026 without considering the grievance and without granting any reasonable opportunity of hearing. It is submitted that the Show Cause Notice dated 08.03.2026, having been issued on a Sunday and granting only three days’ time to respond, is in clear violation of the principles of natural justice. Consequently, the impugned order deserves to be quashed and set aside.
10. In support of his submissions, learned advocate Mr.Parikh has placed reliance upon various decisions, including the judgment of the Karnataka High Court in the case of Sanjay Harichand Chugh Vs. Assessment Unit, (2026) 185 com 80 (Karnataka), wherein the Court, while considering a case in which only six days’ time had been granted to respond to the notice, quashed the assessment order and remanded the matter for fresh consideration.
11. Reliance is also placed upon the judgment of this Court dated 09.02.2026 passed in Special Civil Application No.1210 of 2023. It is urged that the impugned order be quashed and set aside and the matter be remanded for fresh adjudication.
12. Opposing the aforesaid submissions, learned Senior Standing Counsel Mr.Dev D. Patel has submitted that the petitioner had, in fact, filed its reply before the jurisdictional Assessing Officer, with whom no assessment proceedings were pending. The proceedings were, in fact, pending before the Faceless Assessing Officer, who had issued the Show Cause Notice and the only permissible mode of responding to the notice was by filing the reply through the e-filing portal within the prescribed time. It is urged that the impugned order came to be passed since the jurisdictional Assessing Officer has no authority to take cognizance of the grievance of the petitioner or reply.
13. We have heard the learned advocates appearing for the respective parties.
14. It is not in dispute that by the Show Cause Notice dated 08.03.2026, which was issued on a Sunday, the Assessing Officer granted time only till 11.03.2026 i.e. merely three days, for filing a reply.
15. The petitioner thereafter filed its reply along with the grievance on 16.03.2026, specifically requesting an opportunity of hearing through video conference. However, the Assessing Officer proceeded to pass the impugned assessment order dated 17.03.2026 without considering the grievance and without granting any reasonable opportunity of hearing.
16. Thus, in view of the settled legal position, granting only three days’ time to file a reply cannot be said to be a reasonable opportunity. The Assessing Officer ought to have considered and decided the petitioner’s grievance dated 16.03.2026, wherein objection was raised regarding the inadequate time granted for filing the reply.
17. The petitioner had also emailed the grievance as well as its reply on 16.03.2026. However, the same has not been considered by the Assessing Officer while passing the impugned assessment order.
18. Accordingly, the impugned assessment order is quashed and set aside. The matter is remanded to the Assessing Officer for fresh consideration. The Assessing Officer shall afford the petitioner an adequate opportunity of hearing including an opportunity of personal hearing, if otherwise permissible in law and thereafter pass a fresh order in accordance with law within a period of twelve weeks from the date of receipt of a copy of this judgment.
19. With the aforesaid observations, the present writ petition succeeds. Rule is made absolute accordingly.
