Jaihan Infrastructure Vs DCIT (Madras High Court)
Madras High Court held that completion of assessment on best judgement as the petitioner had not shown cause in response to the notice vis-à-vis assessment made after several years of return filing. Hence, matter restored back for providing opportunity of being heard to petitioner.
Facts- The petitioner, which is a partnership firm engaged in the business of developing real estate, had filed its return of income on 28.09.2013. Pursuant to a search conducted at the premises of Mr.K.S.Thirumalaivasan, a partner of the petitioner firm, on 11.10.2012, loose sheets were recovered. These documents indicate that the petitioner had entered into a joint development agreement on 14.06.2010 with one Mr.M.S.Vijayakumar and his family in respect of development of a bare land at Alandur, Thiru-vi-ka Industrial Estate, Guindy.
After recording a satisfaction note on 27.03.2019, a notice u/s. 153C was issued to the petitioner. Eventually, the impugned assessment order was issued on 30.12.2019. In this writ petition, the assessment order dated 30.12.2019 in respect of assessment year 2013-2014 is challenged.
Conclusion- Such assessment was made on best judgment basis because the petitioner had not shown cause in response to the notice.
Held that although the respondent cannot be faulted for completing the assessment on best judgment basis in the facts and circumstances, it is also clear that an assessment was made several years after the petitioner filed the return of income on the basis of material unearthed in course of search in 2012. When these facts and circumstances are considered cumulatively, I am of the view that it is appropriate that the petitioner be provided an opportunity of being heard before the reassessment is concluded. Solely for this reason, the impugned assessment order calls for interference. Consequently, the impugned assessment order is directed to be treated as a show cause notice. The petitioner shall file a reply on such basis within a maximum period of 15 days from the date of receipt of a copy of this order. Upon receipt thereof, the assessing officer is directed to provide a reasonable opportunity to the petitioner, including a personal hearing, and thereafter issue a fresh assessment order within a period of two months from the date of receipt of the petitioner’s reply.
