TMI Blog2022 (2) TMI 1410X X X X Extracts X X X X X X X X Extracts X X X X ..... he matter and all questions are left open; c) the first respondent shall now proceed from the stage of objections dated 30.06.2021, decide on the request for personal hearing and complete the penalty proceedings inter alia under Section 271(1)(c) of IT Act and pass orders afresh as expeditiously as the business of the first respondent would permit and in any event within 12 weeks from today i.e., on or before 28.04.2022; d) The two queries raised in paragraph 9 of the proceedings dated 31.01.2022 are left open and decision regarding the personal hearing will be taken in accordance with standards, procedures and processes if any. - Hon'ble Mr. Justice M.Sundar For the Petitioner : Mr.P.J.Rishikesh For the Respondents : Mr.N.Dilipkumar, Senior Standing Counsel for Income Tax. ORDER Read this in conjunction with and in continuation of earlier proceedings made in the previous listings on 31.01.2022 which reads as follows: 'Proceedings in W.M.P.(MD)No.1423/2022 in W.P.(MD)No. 1631 of 2022 dated 31.01.2022: In the captioned Writ Miscellaneous Petition [WMP] an order dated 17.01.2022 being an order under Section 271(1)(c) of the Income T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... JB of IT Act; that vide this assessment order it was made clear that penalty under Section 271(1)(c) of IT Act will be initiated for 'inaccurate particulars of income'; that post such assessment order a show cause notice [hereinafter 'SCN' for the sake of brevity] under Section 274 r/w. 271(1)(c) of IT Act being SCN dated 22.06.2021 came to be issued calling upon the writ petitioner assessee to respond on or before 01.07.2021; that the writ petitioner assessee responded on 30.06.2021 vide a detailed reply inter alia contending that this is not a case of inaccurate particulars of income; that what is of significance is in the concluding paragraphs the assessee had sought for a personal hearing; that the assessee thereafter preferred a statutory appeal before the jurisdictional Income Tax Appellate Tribunal [ITAT] ie., ITAT, Chennai assailing the assessment order dated 22.06.2021 and this statutory appeal before ITAT was made some time in August 2021; that thereafter the impugned order of first respondent came to be made; that the impugned order does not say anything about writ petitioner's request for personal hearing; that inter alia alleging violation of NJP [N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as, in a case,- (a) initiated penalty proceedings and issued a show-cause notice for imposition of penalty; or (b) recommended initiation of penalty proceedings, it shall refer such case, in the form specified in clause (viii) of paragraph 12, to the National Faceless Penalty Centre; (ii) the National Faceless Penalty Centre shall in a case, where reference has been received as per clause (i), assign such case to a specific penalty unit in any one of the Regional Faceless Penalty Centres through an automated allocation system; (iii) where in a case assigned to a penalty unit, initiation of penalty proceedings has been recommended, such unit, after examination of the material available on record, may decide to,- (a) agree with the recommendation and prepare a draft notice calling upon the assessee or any other person, as the case may be, to show cause as to why penalty should not be levied under the relevant provisions of the Act; or (b) disagree with the recommendation, for reasons to be recorded in writing, and send such draft notice or the reasons, as the case may be, to the National Faceless Penalty Centre; (iv) the National Faceless Penalty Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecifying the date and time for furnishing a response; (xi) the income-tax authority or the National Faceless Assessment Centre or the assessee or any other person, as the case may be, shall furnish a response to the notice or requisition, as referred to in clause (x), within the date and time specified therein, or such extended date and time as may be allowed on the basis of an application made in this behalf, to the National Faceless Penalty Centre; (xii) where a request for conducting of certain enquiry or verification or seeking technical assistance has been made by the penalty unit, the National Faceless Penalty Unit shall send such request to the National Faceless Assessment Centre specifying a date and time for submitting a report; (xiii) where response to notice referred to in clause (x) is filed by the income-tax authority or the National Faceless Assessment Centre or the assessee or any other person, as the case may be, the National Faceless Penalty Centre shall send such response to the penalty unit, and where no such response is filed, inform the penalty unit; (xiv) where a report in response to request referred to in clause (xii) is received by the N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to a penalty unit, as referred to in clause (xix), such penalty unit, after considering the material on record including suggestions for modification and reasons recorded by the penalty review unit,- (a) in a case where the modifications suggested by the penalty review unit are prejudicial to the interest of assessee or any other person, as the case may be, as compared to the proposal of the penalty unit under clause (xv), shall follow the procedure laid down in clauses (v) to (xiv) and prepare a revised draft order for imposition of penalty; or (b) in a case where the modification are not prejudicial to the interest of assessee or any other person, as the case may be, shall prepare a revised draft order for imposition of penalty; or (c) may propose non-imposition of penalty, for reasons to be recorded in writing, and send such order or reasons to the National Faceless Penalty Centre; (xxi) upon receipt of revised draft order from the penalty unit, as referred to in clause (xx), the National Faceless Penalty Centre shall pass the penalty order as per such draft and serve a copy thereof upon the assessee or any other person or not impose penalty under intimati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proved ie., whether personal hearing has to be given is a decision which has to be taken by the Chief Commissioner or Director General in charge of the Regional Faceless Penalty Centre. Therefore there is a provision for personal hearing but it is not statutorily imperative in every case in which an assessee asks for personal hearing. It is at the discretion of these two authorities. 8. This takes us to the question as to how the discretion has to be exercised by these two authorities. Paragraph No.12 talks about these two authorities (with the approval of the Board) laying down standards, procedures and processes for effective functioning of National Faceless Penalty Centre. The reference to 'Board' is an obvious reference to Central Board of Direct Taxes [CBDT] [paragraph 2(vi) of said Scheme]. This takes us to the question as to whether such standards, procedures and processes have been laid down. This Court is informed that for faceless assessment inter alia under Section 144B a SOP [Standard Operating Procedure] had been put in place. 9. Learned Revenue Counsel seeks time to ascertain the following and revert to this Court; a) Whether standards, pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 17.01.2022 bearing No.DIN-ITBA/PNL/F/271(1)(c)/ 2021-22/ 1038807997(1) made by the first respondent is set aside solely on the ground that a decision regarding the writ petitioner/assessee's request for personal hearing has not been decided one way or the other in accordance with the said scheme; b) though obvious, it is made clear that this Court has not expressed any view or opinion on the merits of the matter and all questions are left open; c) the first respondent shall now proceed from the stage of objections dated 30.06.2021, decide on the request for personal hearing and complete the penalty proceedings inter alia under Section 271(1)(c) of IT Act and pass orders afresh as expeditiously as the business of the first respondent would permit and in any event within 12 weeks from today i.e., on or before 28.04.2022; d) The two quires raised in paragraph 9 of the proceedings dated 31.01.2022 are left open and decision regarding the personal hearing will be taken in accordance with standards, procedures and processes if any. 7. Captioned writ petition is disposed of in the aforesaid manner. Consequently captioned WMP is disposed of as closed. There shall be n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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