Case Details: R. Soundararajan & Co. v. Deputy Tax Officer – [2023] 155 taxmann.com 385 (Madras)

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Judiciary and Counsel Details

  • Mrs S. Srimathy, J.
  • N. Viswanathan for the Petitioner.
  • B. Saravanan for the Respondent.

Facts of the Case

In the present petition, the petitioner challenged the assessment order on the ground that no notice was given to the petitioner before passing the order. It was also submitted that the notice was not sent on registered e-mail id and no opportunity of hearing was provided before passing demand order.

Assessee’s Arguments

The assessee challenged the demand order on the ground that they were not given a proper opportunity of hearing. The assessee also argued that the notice sent by the ITD was not received by them.

ITD’s Arguments

The ITD argued that the notice was sent to the assessee on their registered email ID and that the assessee was responsible for checking their email regularly. The ITD also argued that the demand order was valid even though the assessee was not given a hearing.

High Court Held

The Honorable High Court noted that the department sent the notice to the some other e-Mail id, which was not the e-Mail id of the petitioner. The petitioner came to know about the notice only after receipt of the impugned order. Therefore, the Court noted that it was clear violation of principles of natural justice as no hearing opportunity was given before passing of adverse order.

Thus, it was held that the impugned order raising demand was liable to be quashed and the petitioner was granted time to submit its objections and thereafter, the department would re-adjudicate matter.

Conclusion

The Madras High Court’s decision in R. Soundararajan & Co. v. Deputy Tax Officer is a significant victory for taxpayers. The decision reaffirms the principle that taxpayers have a right to a fair hearing before any demand order is passed against them.

Implications of the Decision

The Madras High Court’s decision has a number of implications for taxpayers and the ITD.

For taxpayers:

  • Taxpayers should ensure that their registered email ID is up-to-date with the ITD.
  • Taxpayers should check their email regularly for notices from the ITD.
  • If a taxpayer receives a notice from the ITD, they should respond to the notice within the specified time period.
  • If a taxpayer does not receive a notice from the ITD, they should contact the ITD immediately.

For the ITD:

  • The ITD should send notices to taxpayers on their registered email IDs.
  • The ITD should ensure that the notices sent by them are received by the taxpayers.
  • The ITD should give taxpayers a proper opportunity of hearing before passing a demand order.

Overall, the Madras High Court’s decision in R. Soundararajan & Co. v. Deputy Tax Officer is a positive development for taxpayers. The decision reaffirms the principle that taxpayers have a right to a fair hearing before any demand order is passed against them.

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