Surekha Sanjeev Thakur Vs ITO (ITAT Pune)
Pune ITAT Restores Reassessment as Recorded Reasons Were Not Furnished to Assessee
The assessee had not filed her original return for AY 2012-13. Following the issue of notice under section 148, she filed a return declaring total income of ₹1,89,800. The AO thereafter completed the reassessment under section 147 read with section 143(3).
The ITAT observed that the assessment order neither mentioned the date of the section 148 notice nor disclosed the reasons recorded for reopening the assessment. The assessee contended that the recorded reasons had never been supplied to her, and the Departmental Representative could not rebut or explain this position.
Relying on the Supreme Court ruling in GKN Driveshafts (India) Ltd. v. ITO, the Tribunal held that the AO is mandatorily required to furnish the recorded reasons within a reasonable time, permit the assessee to file objections and dispose of those objections through a speaking order before proceeding with the reassessment.
The ITAT also referred to the Bombay High Court’s guidelines in Tata Capital Financial Services Ltd. v. ACIT regarding communication of the complete reasons, supporting material, approval of the superior authority, disposal of objections and grant of personal hearing.
Since the recorded reasons had not been furnished and the assessee had also sought admission of additional evidence, the Tribunal set aside the assessment and restored the matter to the AO for de novo adjudication. The AO was directed to supply the recorded reasons and provide a proper opportunity of hearing.
List of Cases Discussed / Relied Upon
- GKN Driveshaft (I) Ltd vs ITO[2003] 259 ITR 19(SC)
- TATA Capital Financial Services Ltd vs ACIT, [2022] 443 ITR 127 (Bombay)
FULL TEXT OF THE ORDER OF ITAT PUNE
This is an appeal filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), NFAC, Delhi [Ld.CIT(A)], passed u/s. 250 of the Income Tax Act, 1961 (the Act’) for AY 2012-13 on 10.12.2025, emanating from the Assessment Order u/s 147 r.w.s. 143(3) of the Act, dated 30.12.2019.
Findings and Analysis :
2. We have heard both the parties and perused the records. In this case, the Assessee had not filed Return of Income u/s 139(1) of the Act for AY 2012-13. The Assessing Officer (AO) issued Notice u/s 148 of the Act. The AO had not mentioned any date of issue of Notice u/s 148 of the Act in the Assessment Order. The AO has not mentioned the reasons for which the Notice u/s 148 was issued in the Assessment Order.
3. The Assessee had filed return of Income in response to Notice u/s 148 of the Act on 6/8/2019 declaring Total Income at Rs.1,89,800/-. The AO issued Notice u/s 143(2) of the Act on 13/8/2019.
4. We could not understand from the Assessment Order whether the Reasons recorded for reopening were served on the Assessee or Not. Ld. AR submitted that the reasons were not provided to the Assessee. Ld. DR could not explain it.
5. Hon’ble Supreme Court in the case of GKN Driveshaft (I) Ltd vs ITO[2003] 259 ITR 19(SC)has explained the law as under:
Quote, “We see no justifiable reason to interfere with the order under challenge. However, we clarify that when a notice under section 148 of the Income Tax Act is issued, the proper course of action for the noticee is to file return and if he so desires, to seek reasons for issuing notices. The Assessing Officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the Assessing Officer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the Assessing Officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the above said five assessment years.” Unquote.
6. The Hon’ble Bombay High Court in the case of TATA Capital Financial Services Ltd vs ACIT, [2022] 443 ITR 127 (Bombay) [15-02-2022] has laid down following Guidelines:
Quote, “8. In the circumstances, the Revenue is directed to adhere to the following:
(a) While communicating the reasons for re-opening the assessment, a copy of the standard form/ request sent by the Assessing Officer for obtaining approval of the Superior Officer should itself be provided to the assessee. This would contain comment or endorsement of the Superior Officer with his name, designation and date. The Assessing Officer shall not merely state the reasons in the letter addressed to the assessee.
(b) If the reasons make reference to any other document or a letter or a report, such document or letter or report should be enclosed to the reasons. Such portion as it does not bear reference to the assessee concerned could be redacted.
(c) The order disposing the objections should deal with each objections and give proper reasons for the conclusion.
(d) A personal hearing shall be given and minimum seven working days advance notice of such personal hearing shall be granted.
(e) If the Assessing Officer is going to rely on any judgment/ order of any Tribunal or Court reference/ citation of these judgment/ orders shall be provided along with notice for personal hearing so that the assessee will be able to deal with/ distinguish these judgments/ orders.
9. A copy of this order be placed before the members of the Central Board of Direct Taxes who shall issue guidelines to all its officers based on the directions given above with clear instructions that they shall be strictly followed. We only hope that, this will reduce the same errors being repeated by the concerned revenue authorities and will not drive the assessee to rush to the court. Thereby, the burden on the court will also get reduced.” Unquote.
7. In the case of the Assessee, as submitted by Ld. AR, copy of reasons recorded before issuing Notice u/s 148 were never provided to the Assessee. It was mandatory for the AO to provide the reasons recorded, to the Assessee. Ld. AR filed petition for admission of Additional Evidence along with copies of documents which were not filed during Assessment proceedings. In these facts and circumstances of the case, we set aside the Assessment Order to the AO for de-novo adjudication. The AO shall provide copy of reasons recorded for reopening to the Assessee. AO shall provide opportunity of hearing to the assessee.
8. In the result, Appeal of the Assessee is allowed for statistical purpose.
Order pronounced in the open Court on 19th August, 2026
