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2024 (3) TMI 107 - MADRAS HIGH COURTValidity of draft assessment order u/s 144C(1) - difference in numbers in closing and opening stock of Lingerie - challenge is to a draft assessment order and that the petitioner had an alternative remedy by way of approaching the Dispute Resolution Panel - as alleged value of closing stock is more than the value of opening stock of previous assessment year and the assessment year under consideration - personal hearing through video conferencing denied - HELD THAT:- The extract indicates clearly that the income-tax authorities checked the website of the petitioner and found the price range for lingerie of a particular brand 'sloggi'. Based on the price range of such brand, an estimated average price of Rs. 1,500/- was taken as the unit price. On that basis, the total addition of Rs. 27,04,84,500/- was arrived at. Since the show cause notice did not contain the above quantification of the addition, the petitioner was deprived of the opportunity to respond thereto. It is also significant to notice that expenditure to the extent of Rs. 9,01,61,500/-, which was incurred in the previous year, was disallowed without putting the petitioner on notice with regard to such proposed disallowance in the above mentioned show cause notice. Apart from the above, it should not be lost sight of that the petitioner had expressly requested for a personal hearing through video conferencing and the provision of such personal hearing is mandated under clause (viii) of sub-section 6 of Section 144B of the Income-tax Act. For all these reasons, the impugned draft assessment order calls for interference so as to provide a reasonable opportunity to the petitioner. Since an issue not raised earlier finds place in the draft assessment order and probably in the assessment order, it becomes necessary for the respondent to issue a fresh show cause notice or, in the alternative, for the draft assessment order to be treated as a show cause notice. Therefore, it is directed that the draft assessment order be treated as a show cause notice. In view of the interference with the draft assessment order, the assessment order does not survive. The petitioner is permitted to submit a reply to the draft assessment order (i.e. show cause notice) within a period of three weeks from the date of receipt of a copy of this order.
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