Home Finders Housing Ltd. Vs ITO (Supreme Court of India)
The matter arose from reassessment proceedings initiated against the assessee, a real estate promoter, for Assessment Year 2012-13. The assessee had filed a nil return of income, and an assessment order was passed on 23 March 2015. Subsequently, the Assessing Officer formed the view that income chargeable to tax had escaped assessment and issued a notice dated 16 October 2015 under Sections 147 and 148 of the Income-tax Act. On the assessee’s request, the Assessing Officer furnished the reasons for reopening. The assessee filed objections to the reopening, but the Assessing Officer proceeded with the reassessment and passed an assessment order on 30 December 2016 without first disposing of those objections by a separate speaking order.
The assessee challenged the reassessment order before the writ court, contending that the Assessing Officer had violated the procedure laid down by the Supreme Court in GKN Driveshafts (India) Ltd. v. Income Tax Officer, which requires the Assessing Officer to dispose of objections to a notice under Section 148 by a speaking order before proceeding with reassessment. The learned Single Judge accepted that the prescribed procedure had not been followed, set aside the reassessment order, and remitted the matter to the Assessing Officer to consider the objections and proceed afresh, while rejecting the assessee’s objection relating to limitation.
