IN HIGH COURT OF DELHI AT NEW DELHI W.P.(C) 593/2019 & CM No. 2670/2019 SURENDRA KUMAR JAIN Petitioner Through: Mr. Piyush Kaushik and Mr. S.P. Singh, Advocates versus PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL)-III, NEW DELHI & ANR. Respondents Through: Ms. Vibhooti Malhotra, Senior Standing Counsel CORAM: JUSTICE S.MURALIDHAR JUSTICE TALWANT SINGH ORDER 29.07.2019 Dr. S. Muralidhar, J.: 1. On 18th March, 2019, following order was passed by this Court: matter has been listed before this Court as DB-II has not assembled today. Learned counsel for petitioner submits that Assessment for Year 2011-2012 pertaining to petitioner has been re- opened. While reasons to believe have been served upon petitioner, but before objections could be decided, final order has been passed. Reliance has been placed on various judgments of this Court, including judgment passed in case of Smt. Kamlesh Sharma v. B.L. Meena, Income-Tax Officer and Others, reported at [2006] 287 ITR 337(Del}. Notice to show cause as to why petition be not admitted. Notice in stay application as well. Counsel for respondent enters appearance. He submits that submission sought to be W.P.(C) 593/2019 Page 1 of 4 urged, in fact, is not absolute Rule. He submits that reasons to believe have already been supplied to petitioner. He seeks time to file reply. List before Roster Bench on 10.04.2019. Till next date of hearing, no coercive action shall be taken against petitioner. 2. short point involved in present petition is whether Assessing Officer (AO) could have proceeded to finalise reassessment pursuant to notices issued under Section 147/148 of Income Tax Act, 1961 (the Act ) without procedure laid down by Supreme Court in GKN Driveshafts (India) Ltd. v. ITO (2003) 259 ITR 19 (SC) being complied with? 3. This Court has emphasised in several decisions that procedure outlined by Supreme Court in GKN Driveshafts (India) Ltd. (supra) is sacrosanct. In other words, where in response to notice issued under Section 147 by AO, Assessee seeks reasons to believe that prompted re-opening, and files objections thereto, those objections have to be considered on their merits and only reasoned order has to be passed thereon by AO. Importantly, this has to happen prior to AO proceeding with re-assessment. 4. In Sabh Infrastructure Ltd. v. ACIT, (2017) 398 ITR 198 (Del), in similar circumstances, this Court observed that held as under: 19. Before parting with case, Court would like to observe that on routine basis, large number of writ petitions are filed challenging reopening of assessments by Revenue under Sections 147and 148 of Act and despite W.P.(C) 593/2019 Page 2 of 4 numerous judgments on this issue, same errors are repeated by concerned Revenue authorities. In this background, Court would like Revenue to adhere to following guidelines in matters of reopening of assessments: ..... (iv) exercise of considering Assessee s objections to reopening of assessment is not mechanical ritual. It is quasi- judicial function. order disposing of objections should deal with each objection and give proper reasons for conclusion. No attempt should be made to add to reasons for reopening of assessment beyond what has already been disclosed. 5. In present case, AO has not chosen to dispose of objections, filed by Petitioner against reopening of assessment but has proceeded to stage of passing reassessment order itself. 6. In almost identical fact situation in Smt. Kamlesh Sharma v. B.L. Meena, Income-Tax Officer (supra), where AO did not pass any speaking order but straightaway passed assessment order, and simultaneously rejected contention of Petitioner, this Court observed: 3. We are of opinion that in view of language of Supreme Court in GKN Driveshafts [2003] 259 ITR 19 Assessing Officer should have rejected objections, if he thought it appropriate to do so, before passing final order and not simultaneously. 4. This position was reiterated by this Court in Sita World Travels (India) Ltd. v. CIT (2004) 140 Taxman 381 (Del). 5. We cannot appreciate how, in spite of clear language used by Supreme Court as well as this Court, Assessing Officer did not comply with requirement of law. W.P.(C) 593/2019 Page 3 of 4 7. This Court has, therefore, no hesitation in setting aside reassessment order dated 29th December, 2018 for Assessment Year AY 2011-12. Consequently, direction is issued to AO to once again take up for consideration, Petitioner s objections to reopening of assessment for aforementioned AY and dispose of those objections by reasoned order not later than four weeks from today. said order shall be communicated to Petitioner not later one week thereafter. 8. Thereafter, AO will proceed in accordance with law as far as reassessment proceedings are concerned. 9. It will be open to Petitioner to seek appropriate remedies if his objections to reopening of assessment are rejected by AO. 10. writ petition and application are disposed of in above terms. 11. Copy of this order be given dasti under signature of Court Master. S. MURALIDHAR, J. TALWANT SINGH, J. JULY 29, 2019/PB W.P.(C) 593/2019 Page 4 of 4 Surendra Kumar Jain v. Principal Commissioner of Income-tax (Central)-III, New Delhi & Anr