No statutory bar for AO to rectify assessment order even if appeal is pending against it – HC

There is no statutory bar for the Assessing Officer to rectify the assessment order even if an appeal is pending against it – High Court

The instant Writ Petition was filed by the appellant assessee against the notice issued under section 154/155 of the Income Tax Act, 1961 (the Act) by the Assessing Officer (AO) proposing to rectify the assessment order passed.

ABCAUS Case Law Citation:
ABCAUS 2380 (2018) 06 HC

The respondent AO issued to the appellant a notice u/s 154/155 of the Act stating that the assessment order passed under Section 143(3) of the Act required to be amended, as there was a mistake apparent from the record within the meaning of Section 154/155 of the Act.  

The particulars of the mistake proposed to be rectified were furnished in the said notice. The petitioner was directed to appear before the respondent AO and alternatively they were directed to file their written reply on or before the date fixed for personal hearing.

The petitioner contended that against the assessment, which was completed under Section 143(3) of the Act, he had preferred an appeal before the Commissioner of Income Tax (Appeal) and that the appeal was pending and therefore, the AO should defer further action pursuant to the impugned notice.

Now, by the instant writ, the petitioner sought to quash the impugned notice and also to permit him to file their submissions, calculation summaries, records and documents and thereafter direct the respondent AO to pass fresh orders in accordance with law.

The Hon’ble High Court opined that there was no necessity to quash the notice issued u/s 154/155, as there is no statutory bar for the Assessing Officer to rectify the assessment order even if an appeal is pending against it.The  consequential relief sought for by the petitioner would be sufficient to safeguard the interest of the assessee.

The assessee was directed to submit their objections to the impugned notice to the AO and substantiate his stand. The AO was directed to pass a speaking order on merits and in accordance with law.

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