Case Law Details
GPR Textiles P. Ltd. Vs ACIT (Madras High Court)
Madras High Court held that the Assessment Officer has not recorded the reasons for arriving at a subjective satisfaction to initiate penalty proceedings under Section 271E of the Act, which is mandatory. Thus, order set aside.
Facts- These writ petitions have been filed by the petitioner challenging the impugned orders passed by the 1st Respondent u/s 271D of the Income Tax Act, 1961 dated 29.04.2024.
Notably, initially assessment proceedings were initiated against the petitioner on 29.09.2021 and thereafter the same were dropped u/s. 270-A of the Income Tax Act, 1961 and again for the same assessment period, show cause notices were issued on 22.04.2024. The Petitioner submitted its reply on 26.04.2024, but the 1st Respondent without considering the reply filed by the Petitioner has passed the impugned orders which are in violation of principles of natural justice. He further submitted that the Assessing Officer has not recorded his satisfaction for arriving at a conclusion to impose penalty on the petitioner. Therefore, the impugned orders are liable to be set aside.
Conclusion- Held that on a perusal of the impugned orders, it is seen that the Assessment Officer has not recorded the reasons for arriving at a subjective satisfaction to initiate penalty proceedings under Section 271E of the Act, which is mandatory.
Thus, the orders impugned herein are set aside and the matter is remanded back to the 1st Respondent. The 1st Respondent shall pass a detailed reasoned order, by recording the satisfaction for passing the order under Section 271 D of the Act and by considering the reply/objections filed by the Petitioner, as expeditiously as possible, including by providing opportunity of personal hearing.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
Since the issue involved and the nature of relief sought for in all these Writ Petitions are one and the same, they are taken up together and disposed of by this common order.
2. These writ petitions have been filed by the petitioner challenging the impugned orders passed by the 1st Respondent u/s 271D of the Income Tax Act, 1961 dated 29.04.2024.
3. Mr. A. N. R. Jayaprathap, learned junior standing counsel takes notice on behalf of the respondent.
4. By consent of the parties, the main writ petitions are taken up for disposal at the admission stage itself.
5. The learned counsel for the petitioner submits that in all these cases, initially assessment proceedings were initiated against the petitioner on 29.09.2021 and thereafter the same were dropped under Section 270-A of the Income Tax Act, 1961 (in short ‘the Act’) and again for the same assessment period, show cause notices were issued on 22.04.2024. The Petitioner submitted its reply on 26.04.2024, but the 1st Respondent without considering the reply filed by the Petitioner has passed the impugned orders which are in violation of principles of natural justice. He further submitted that the Assessing Officer has not recorded his satisfaction for arriving at a conclusion to impose penalty on the petitioner. Therefore, the impugned orders are liable to be set aside.
5. The learned junior Standing counsel for the Respondents did not dispute the aforesaid submission and prayed for appropriate orders.
6. This Court has given anxious consideration to the submissions made by the learned counsel appearing on either side and perused the materials available on record.
7. On a perusal of the impugned orders, it is seen that the Assessment Officer has not recorded the reasons for arriving at a subjective satisfaction to initiate penalty proceedings under Section 271E of the Act, which is mandatory.
8. Considering the facts and circumstances of the case and submission made by the learned counsel appearing on either side, this Court is of the considered view that the impugned orders are liable to be aside. Accordingly, this court passes the following order:-
(i) The orders impugned herein are set aside and the matter is remanded back to the 1st Respondent.
(ii) The 1st Respondent shall pass a detailed reasoned order, by recording the satisfaction for passing the order under Section 271 D of the Act and by considering the reply/objections filed by the Petitioner, as expeditiously as possible, including by providing opportunity of personal hearing.
9. Accordingly, the writ petitions are disposed of. There is no order as to costs. Consequently, the connected miscellaneous petitions are closed.
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