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2017 (9) TMI 1042 - HC - Income TaxReopening of assessment - reasons to believe - whether the respondent was duty bound to pass a separate speaking order on the objections raised by the petitioner for reopening? - Held that:- The Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd. (2002 (11) TMI 7 - SUPREME Court) held that when a notice under Section 148 of the Income Tax Act is issued, the proper course of action for the noticee is to file a return and if he so desires, to seek reasons for issuing notices. The Assessing Officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the Assessing Officer is bound to dispose of the same by passing a speaking order. This procedure has been carved out in GKN Driveshafts (supra) binds not only the assessee, but the revenue as well. Thus, the procedure, which was required to be followed by the respondent is to dispose of the petitioner's objections by passing a speaking order. Admittedly, in the instant case, this has not been done by the respondent, but the respondent seeks to sustain the impugned assessment order stating that in the first few paragraphs of the order, he has dealt with objections and disposed of accordingly. Unfortunately, the manner in which the respondent has decided the issue is wholly unsustainable in law. The purpose for passing a separate speaking order on the objections is with a view to afford an opportunity to the assessee to question such an order, if he is aggrieved. The respondent by passing the impugned order has taken away such valuable right from the petitioner inasmuch as the impugned proceedings is an order of assessment under Section 143(3). Therefore, if an order of assessment has to be challenged, necessarily an appeal has to be preferred and only in rarest of rare case, Courts would entertain challenge to assessment orders in writ proceedings. Thus, the procedure adopted by the respondent is completely flawed, which goes to the root of the matter, thereby, vitiates the entire proceedings. - Decided in favour of assessee.
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