No personal hearing was granted; the HC revoked the Section 148A(b) order and the 148 Notice
Vazhakkulam Block Rural Co-Operative Society Ltd Vs ITO (Kerala High Court)
Facts:
- Petition Overview: The writ petition challenges Ext.P5 order under Section 148A(b) and Ext.P6 Notice under Section 148 of the Income Tax Act.
- Absence of Personal Hearing: The petitioner wasn’t given a chance to speak before the Ext.P5 order was issued.
- Relevant Precedent: A previous court case, Asamannoor Service Co-operative Bank Ltd. Vs. Income Tax Officer in WP (C) No. 12595 of 2023, tackled a similar issue and guided on the importance of a personal hearing.
Court’s Ruling:
- Interpretation of Section 148A(b): Section 148A(b) mandates providing the assessee with an opportunity of being heard before serving a notice under Section 148. The court emphasized that ‘hearing’ isn’t just about replying to a notice; it implies a personal, direct hearing.
- Disagreement with Counsel: The court dismissed the counsel’s argument that ‘opportunity of being heard’ didn’t necessarily mean a personal hearing. The court asserted that it did mean giving the assessee a chance for a direct conversation.
Conclusion:
- Unsustainability of Ext.P5 Order and Ext.P6 Notice: Due to the absence of a personal hearing, the court declared Ext.P5 order and Ext.P6 notice unsustainable.
- Direction to the Petitioner: The petitioner was instructed to appear before the respondent on 12.12.2023 with all relevant documents for a personal hearing.
- Assessing Officer’s Action: After considering the petitioner’s submission, the assessing officer was directed to issue a fresh order and proceed with the notice under Section 148.
- Important Note: If the petitioner fails to appear on 12.12.2023, no further hearing opportunity will be granted.
Final Outcome:
The writ petition was disposed of with the direction for a personal hearing, emphasizing the necessity of this step before taking tax-related actions under Section 148 of the Income Tax Act.
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