Facts
For AY 2018–19, the petitioner, a pharmaceutical manufacturer, filed a return declaring a loss of ₹3,68,51,957.
Source reference: no citationIn scrutiny proceedings conducted electronically, the respondent issued a draft assessment order proposing an addition of ₹15.39 crore under Section 56(2)(viib) of the Income-tax Act, 1961, and invited the petitioner’s response by 11:59 p.m. on 12 April 2021.
Source reference: p. 2–3The petitioner filed its response through the e-filing portal on 12 April 2021 and received an electronic acknowledgment and departmental email confirming submission.
Source reference: p. 3–4On 13 April 2021, the respondent passed the final assessment order, made the proposed addition, and raised a demand of ₹4,62,92,820, without referring to or considering the response and recording that no reply had been furnished.
Source reference: p. 3–4, 6–7The petitioner challenged the order by writ petition, alleging breach of natural justice.
Source reference: p. 1, 4Issues
Whether the assessment order was passed in breach of natural justice when the respondent did not consider the petitioner’s timely filed response before making the proposed addition?
Source reference: p. 5–7Whether the assessment order should be quashed and set aside on that ground?
Source reference: p. 7Law Applied
The assessment was made under Section 143(3), read with Sections 143(3A) and 143(3B) of the Income-tax Act, 1961, governing the assessment and electronic assessment process.
Source reference: p. 1–2The proposed addition arose under Section 56(2)(viib).
Source reference: p. 3The Court applied the principles of natural justice, holding that an assessment order that disregards a response filed within the time granted—and records, contrary to the record, that no response was submitted—cannot stand.
Source reference: p. 6–7Reasoning
The petitioner’s response was submitted before the stated deadline, and the portal acknowledgment and departmental email confirmed its receipt.
Source reference: p. 3–4, 6The respondent did not dispute those facts.
Source reference: p. 5Because the final order neither considered the response nor accurately recorded that it had been filed, the Court found that the order was contrary to the record and amounted to a gross violation of natural justice.
Source reference: p. 7Holding
The Court held that the assessment order dated 13 April 2021 could not stand because it was passed without considering the petitioner’s timely response and on the erroneous basis that no reply had been filed.
It quashed and set aside the impugned order, allowed the petition, and made the rule absolute.
Source reference: p. 7Acts & Sections Cited
3 provisions across 1 statute referred to in this judgment. Linked provisions open on LawLens.
Income Tax Act, 19613
Original Court PDF
RATNAMANI HEALTHCARE PRIVATE LIMITEDvsTHE NATIONAL E-ASSESSMENT CENTRE, GOVERNMENT OF INDIA
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