Curtailing time to file reply to notice u/s 148A(b) from statutorily available 30 days to 15 days seriously prejudiced assessee’s right – High Court
In a recent judgment Hon’ble High Court held that curtailing assessee’s right or time to file reply in response to notice u/s 148A(b) from 30 days to 15 days seriously prejudiced his right as a period of 30 days was available to an assessee for filing the reply as per the statute.
ABCAUS Case Law Citation:
5230 (2026) (09) abacus.in HC
In the instant case, the Petitioner/assessee had assailed the order passed under Section 148A(d) of the Income Tax Act, 1961 (the Act) and corresponding notice issued under Section 148 of the Act.
It was submitted that initially a notice under Section 148A(b) of the Act was issued to the petitioner on 22.02.2024 fixing the date of hearing as 03.03.2024 on which date the petitioner sought an adjournment for 15 days.
On 03.03.2024, the Assessing Officer adjourned the hearing to 08.03.2024; on which date, the petitioner again sought an adjournment for two weeks but the Assessing Officer instead only granted two days’ time to file reply, i.e., by 10.03.2024. According to the petitioner, since its accountant was out of station, it could not file reply and thus, a request for adjournment was sent seeking 15 days’ time to file reply. The reply was, however, filed on 15.03.2024.
Though the Petitioner filed the reply on 15.03.2024, the Assessing Officer proceeded to pass an order under Section 148A(d) of the Act on 18.03.2024 without considering the said reply filed filed on 15.03.2024.
It was argued that when the Assessing Officer was having petitioner’s reply duly filed on 15.03.2024, he ought to have at least considered the reply, while passing the order under Section 148A(d) of the Act. Non-consideration of the reply filed by the petitioner led to violation of principles of natural justice and has caused serious prejudice to the petitioner.
The Revenue, on the other hand, submitted that two opportunities had already been granted to the petitioner and the last date for filing the reply given to the petitioner was 10.03.2024 and since the petitioner had failed to file its reply by such date, the reply which the petitioner had filed was liable to be and rightly ignored by the Assessing Officer.
It was stated by the Revenue that the statute provides for specified time limit and when the assessee wants an Assessing Officer to stick to timeline, it is equally required of the assessee to adhere to the time allowed to it.
The Hon’ble High Court noted that the petitioner had sought an adjournment and only two days’ time was allowed to the petitioner to file reply whereas a period of 30 days is available to an assessee for filing the reply as per the statute.
In view of the above, the Hon’ble High Court opined that the Assessing Officer had enough time left at his disposal, (at least upto 22.03.2024) to take petitioner’s reply. There was no pressing hurry to eschew petitioner’s right to file reply or to confine its right to file reply by 10.03.2024
The Hon’ble High Court opined that curtailing petitioner’s right or time to file reply from 30 days to practically 15 days (from 03.03.2024 to 10.03.2024) had seriously prejudiced petitioner’s right and considering that on 09.03.2024, a day ahead of the due date of filing reply, the petitioner had sent an e-mail to the Assessing Officer to grant two weeks’ time, the Assessing Officer ought to have granted some time to the petitioner, so as to serve the ends of justice. Further, the petitioner’s reply had already been uploaded, hence, the Assessing Officer could very well see and consider the reply so filed before passing an order, but he had chosen not to do so.
The Hon’ble High Court opined that the AO’s approach suffered from irregularity and led to violation of principles of natural justice.
Accordingly, the Hon’ble High Court set aside the impugned order u/s 148A(d) of the Act and consequential notice under Section 148. The Assessing Officer was directed to pass a fresh order under Section 148A(d) of the Act after considering petitioner’s reply dated 15.03.2024 in accordance with law, without being influenced by the earlier order which he had passed.
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