Dr. Sajan Hedge Vs ACIT (Madras High Court)
Conclusion: Instead of quashing the entire reassessment proceedings, it was suffice if an opportunity was provided to assessee to submit additional objections, if any, based on the materials relied on by assessee to AO, within a stipulated period and on receipt of the same, AO should be permitted to proceed with the assessment/re-assessment.
Held: Assessee was an ortho-pediatrician and surgeon. A reopening notice was issued on the ground of the statement of person who was manager in the Hospital in which assessee was practicing. In the recorded statement, the manager stated that based on the number of patients visited, income from consultation fees received by assessee from hospital practice was much more than what was shown by him. Assessee submitted that the copy of the manager’s statement was not enclosed along with the show cause notice issued. The revenue pointed out that even presuming it was not enclosed, the assessee had not sought the copy immediately and even, in the letter sent subsequently by assessee, there was no mentioning regarding furnishing of the said statement. Thus, the very statement that the enclosure was not available along with the show cause notice could not be trusted upon. However, the said statement of Ms. S was subsequently handed over to the authorized representative of assessee. Assessee sought further opportunity to submit elaborate objections. In the event of quashing the initiation proceedings and providing an opportunity to submit further objections, it would cause prejudice to the revenue. Contrarily, assessee might be permitted to submit all his further objections based on the statement of Ms. S enabling the AO to consider the same and accordingly, proceed with the assessment/re-assessment, based on the reopening of assessment proceedings. Thus, instead of quashing the entire proceedings, it was suffice if an opportunity was provided to assessee to submit additional objections, if any, based on the materials relied on by the assessee to the Assessing Officer, withing a stipulated period and on receipt of the same, AO should be permitted to proceed with the assessment/re-assessment. This being the factum established, assessee was directed to submit his further objections along with the materials, documents, etc., to AO within a period of two weeks from the date of receipt of a copy of this order. On receipt of any such objections from assessee, the respective authority should consider the same along with the process of assessment/re-assessment by providing an opportunity to assessee. In the event of not receiving any such objection within a period of three weeks, the authority was at liberty to proceed further for assessment/re-assessment and complete the exercise as expeditiously as possible.
