Reopening without disposing Assessee’s objections, not valid

Brief of the Case

Bombay High Court held In the case of M/s. Bayer Material Science Pvt. Ltd. vs. DCIT that the draft Assessment order was passed on 30th March, 2015 without having disposed of the Assessee’s objections to the reasons recorded in support of the impugned notice.  The reasons were supplied only on 19th March, 2015 and the assessee had filed the objections to the same on 25th March, 2015.This passing of the draft Assessment order without having disposed of the objections is in defiance of the Supreme Court’s decision in GKN Driveshafts (India) Ltd. 259 ITR 19(SC).Thus; the draft Assessment order is not sustainable being without jurisdiction. This for the reason that it has been passed without disposing of the objections filed by the assessee to the reasons recorded in support of their impugned notice.  Accordingly draft Assessment order is bad in law.

Facts of the Case

For the Assessment year 2007-2008, the assessee had filed a return of income declaring total income of Rs.12.77 Crores.  The same was accepted by issuing intimation under Section 143(1). On 6th February, 2013 the impugned notice was issued seeking to reopen the Assessment. On 15th March, 2013 itself, the assessee filed its revised return of income and sought reasons recorded in support of the impugned notice. The revenue did not furnish the reasons recorded, in spite of the Assessee’s repeated communications such as letters dated 15th March, 2013 and 12th September, 2013 seeking the reasons recorded for issuing the impugned notice. However, the Assessing Officer furnished the reasons recorded for issuing the impugned notice to the Petitioner only on 19th March, 2015.

On 25th March, 2015 the Petitioner filed its objections to the reasons recorded as communicated for issuing the impugned notice dated 6th February, 2013.The Assessing Officer without disposing of the Petitioner’s objections passed a draft Assessment order dated 30th March, 2015.

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