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2013 (7) TMI 174 - GUJARAT HIGH COURTSpecial Audit u/s 142(2A) - Personal appearance - whether requirement of hearing envisaged under Section 142 (2A)includes personal hearing - Held that:- it is required for the Assessing Officer to give a reasonable opportunity of being heard to the assessee before passing an order to get the accounts audited under section 142 (2A) - opportunity of hearing does not always include personal hearing - The same must depend on the statutory provisions from which such right flows; the nature of the proceedings and the consequences likely to follow from such proceedings - when complex and technical questions of law and facts are involved, such hearing would be necessary - the Assessing Officer had issued notices to the assessee under section 142 (1) - When there was no compliance, notice for appointment of special auditor came to be issued. Petitioner’s objections were considered, approval from the Commissioner was sought. On the strength of such approval so granted by the Commissioner, the Assessing Officer on the basis of his opinion that the accounts of the assessee were complex and in the interest of the Revenue, it was so required, directed that the accounts be audited by the special auditor - proviso to Section 142(2A) does not envisage any personal hearing before an order under sub-section (2A) can be passed - Following decisions of F.N Roy v. Collector of Customs, Calcutta & Ors. [1957 (5) TMI 1 - SUPREME COURT OF INDIA], Union of India v. Jyoti Prakash Mitter [1971 (1) TMI 108 - SUPREME COURT] and Smt. Ambeydevi v. State of Bihar & Anr. - Decided in favour of Revenue. Special audit - 142(2A) - Complexity of accounts and complexity of the question whether accounts are complex or not - Held that:- petitioner had been given previous notices under section 142 (1) of the Act with respect to its accounts but for a long time, the petitioner did not comply with such notices - Assessing Officer, therefore, issued notice why considering the complexities in the accounts, the same may not be audited by the special auditor - authorities have highlighted several aspects of the matter to indicate that the accounts were complex and that interest of revenue would be served if the special audit report is obtained - notice was issued in December 2012 where admittedly, the proceedings were getting time barred on 31st March 2012. There was thus sufficient time to complete the assessment even without the extended time limit - according to the own showing of the petitioner, when it was asked to give explanation/reply to the various points raised in the notice dated January 29, 1999, it had taken a stand that it would take several months in compiling the information - Commissioner of income-tax had applied his mind and had also come to the conclusion that it is essential to know the actual state of affairs of the Corporation as the books of account are complex and enormous anomalies and discrepancies have also been pointed out by the statutory auditors in their audit report - it cannot be said that the preconditions for appointment of the special auditor, as envisaged under section 142 (2A) of the Act, have not been fulfilled - Following decision of U.P Financial Corporation v. Joint Commissioner of Income Tax & Ors. [2004 (10) TMI 22 - ALLAHABAD High Court], Jhunjhuwala Vanaspati Ltd. Versus Assistant Commissioner of Income-Tax And Another [2004 (2) TMI 56 - ALLAHABAD High Court] and Uttaranchal Welfare Society Versus Commissioner Of Income-Tax And Others [2004 (4) TMI 60 - ALLAHABAD High Court] - Decided in favour of revenue.
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