Failure Of Assessing Officer To Comply With Section 144C Of Income Tax Act Invalidates Assessment Order : Delhi High Court
Live LawThe Delhi High Court has held that the failure of the assessing officer to adhere to the "mandatory requirement" of Section 144C of the Income Tax Act, 1961, will invalidate the final assessment order.Section 144C, inserted in the Act by 2009 amendment, states that Assessing Officer should forward the draft of the proposed assessment order to the eligible assessee if any variation of. The Delhi High Court has held that the failure of the assessing officer to adhere to the "mandatory requirement" of Section 144C of the Income Tax Act, 1961, will invalidate the final assessment order. Section 144C : The Assessing Officer shall, notwithstanding anything to the contrary contained in this Act, in the first instance, forward a draft of the proposed order of assessment to the eligible assessee if he proposes to make, on or after the 1st day of October, 2009, any variation which is prejudicial to the interest of such assessee A division bench comprising Justices Manmohan and Sanjeev Narula held that the provision was a "mandatory requirement" and the failure to comply with it will invalidate the final assessment order. The Court opined that if the Assessing Officer under Section 144C can prepare a draft assessment order only, then by virtue of a remand order which directs the Assessing Officer to decide the matter de novo, the Assessing Officer cannot get the power to pass an assessment order, when there is an objection by the Assessee like in the present case, without reference of the Dispute Resolution Panel which comprises of three Principal Commissioners or Commissioners of Income Tax constituted by the Board.