R.R. International Vs Assessment Unit (Madras High Court)
Conclusion: Court had conditionally remanded an income tax assessment order after the petitioner was unable to opt for a personal hearing due to a technical glitch in the e-filing portal. Denial of a hearing due to system failure constituted a violation of the principles of natural justice.
Held: Assessee-firm had challenged the assessment order passed under Section 143(3) read with Section 144B for the Assessment Year 2022-23. Assessee contended that although it had submitted replies to the show cause notices issued on 20.03.2024 and 24.03.2024, it was unable to avail the option of a personal hearing due to the portal automatically closing after submitting the reply. Department argued that the portal had clear instructions to request a personal hearing by clicking the “seek video conferencing” button before submitting the reply. However, assessee maintained that the system’s automatic closure denied it a fair opportunity to opt for the hearing. It was held that technical impediments beyond the taxpayer’s control couldn’t be held against them. The Court ruled that an assessment order passed without affording an opportunity of personal hearing, especially where demand was raised, violated natural justice. Accordingly, High Court set aside the impugned assessment order and remanded the matter to the assessment unit, subject to assessee depositing ₹10,000 with the Principal Government Naturopathy Medical College and Hospital. The Court directed the department to reactivate the portal, allow assessee to file a fresh reply, and grant a personal hearing before passing a fresh order on merits.
