Gujarat High Court
Tatvartha Health Private Ltd vs The Assessment Unit, Income Tax ... on 6 October, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 6741 of 2024
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
==================================================
Approved for Reporting No Yes
✔
==================================================
TATVARTHA HEALTH PRIVATE LTD
Versus
THE ASSESSMENT UNIT, INCOME TAX DEPARTMENT
==================================================
Appearance:
DARSHAN R PATEL(8486) for the Petitioner(s) No. 1
KARAN G SANGHANI(7945) for the Respondent(s) No. 1
==================================================
CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 06/10/2025
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE PRANAV TRIVEDI)
1. Heard learned advocate Mr. Darshan Patel for the
petitioner and learned Senior Standing Counsel Mr. Karan
Sanghani for the respondents.
2. Rule returnable forthwith. Learned Senior Standing
Counsel Mr. Karan Sanghani waives service of notice of rule on
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
behalf of the respondents.
3. Having regard to the controversy involved which is in a
narrow compass, with the consent of the learned advocates for
the parties, the matter is taken up for hearing.
4. By this petition under Articles 226/227 of the Constitution
of India, the petitioner has prayed to quash and set aside the
impugned order passed by the respondent under Section 143(3)
read with Section 144B of the Income Tax Act, 1961 (For Short
"the Act") dated 31.08.2024 along with demand notice dated
23.03.2024 under Section 156 of the Act and notice for penalty
under Section 274 read with Section 217AAC of the Act for the
Assessment Year 2022-23.
5. The brief facts of the case are as under :-
5.1. The petitioner is a Private Limited Company and filed its
return of income for the Assessment Year 2022-23 on
18.10.20222 declaring total income of Rs.3,43,36,165/-.
Subsequently the case of the petitioner was selected for
scrutiny of Computer-Assisted Scrutiny Selection (CASS) and
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
notice under Section 142(1) of the Act was issued on 01.08.2023
requesting to furnish several details.
5.2. In response to the notice dated 01.08.2023, the petitioner
filed its reply dated 28.03.2023 along with computation of total
income, MAT computation, financial, ITR forms etc. However,
the respondent issued another notice on 26.02.2024 under
Section 142(1) of the Act which was again replied by the
petitioner on 28.02.2024. The petitioner also filed additional
reply on 04.03.2024.
5.3. Subsequently, the respondent issued third show cause
notice on 13.03.2024 calling for further details from the
petitioner. The petitioner filed its reply to the show cause notice
on 15.03.2024. It was the case of the petitioner that the last
show cause notice was issue to the petitioner on 15.03.2024
calling for several details and also directing the petitioner to file
its response on or before 18.03.2024 i.e. within three days. It
was further the case of the petitioner that out of three days i.e.
16.03.2024 and 17.03.2024 were Saturday and Sunday and
therefore, practically the petitioner was not given any time to
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
file the reply.
5.4. As the petitioner could not file any reply, the respondent
passed the final Assessment Order under Section 143(3) read
with Section 144B of the Act on 23.03.2024 as well as raised
demand notice under Section 156 of the Act as well as notice
for penalty under Section 274 read with Section 271AAC of the
Act on the same date i.e. on 23.03.2024, which are not
impugned in the present writ petition.
6. Learned advocate Mr. Darshan Patel for the petitioner
submitted that the final Assessment Order passed by the
respondent is in gross violation of the principles of natural
justice. In the show cause notice dated 15.03.2024, the
respondent granted time of less than three days to file its reply.
Two days out of the three days were Saturday and Sunday and,
therefore, practically the petitioner was not granted any time to
file its reply and the final Assessment Order was passed on
23.03.2024. It was further submitted that non-granting
minimum 15 days time is contrary to the decision of this Court
in case of M/s. Advance Reality Developers v. National E-
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
Assessment Centre, Delhi rendered in Special Civil
Application No. 7731 of 2021 dated 20.12.2021 wherein this
Court has observed that minimum 15 days' time is a reasonable
time.
6.1. It was further submitted by learned advocate Mr. Darshan
Patel that if the respondent had not granted sufficient time, the
respondent ought to have granted personal hearing through
video conference as per Section 144B(6)(vii) of the Act. In wake
of such submissions, learned advocate Mr. Darshan Patel has
contended that the respondent has violated the basic principles
of natural justice and fair play and therefore, the illegality has
crept in the final Assessment Order.
7. Per contra, learned Senior Standing Counsel Mr. Karan
Sanghani for the respondent could not controvert the
submissions made by learned advocate Mr. Darshan Patel. After
relying upon the affidavit-in-reply filed on behalf of the
respondent, it was submitted that the respondent earlier had
granted time on many occasion to file its reply, however, the
same were not filed by the petitioner. However, learned Senior
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
Standing Counsel Mr. Karan Sanghani could not controvert the
fact that the final Assessment Order was passed on 15.03.2024
and only three days; time was granted to the petitioner to file its
reply, and two days out of three days were Saturday and
Sunday. It was therefore submitted that this Court may pass
appropriate order.
8. Having heard the learned counsel for the respective
parties and having gone through the material placed on record,
it is not in dispute that the respondent had given only three
days' time to file the reply. It is a fundamental proposition of
law that the other side should be heard before any order is
passed. The maxim of Audi Alteram Partem is broad enough to
include the rule against bias since a fair hearing is must for it to
be unbiased hearing. In the instant case, the fact is not in
dispute that the petitioner was not given appropriate time to
respond to the notice issued under Section 142(1) of the Act and
the final Assessment Order was passed without hearing the
petitioner.
9. In view of the same, the impugned Assessment Order
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
passed by the respondent under Section 143(3) read with
Section 144B of the Act, dated 23.03.2024 along with demand
notice dated 23.03.2024 under Section 156 of the Act and
notice for penalty under Section 274 read with Section 217AAC
of the Act for the Assessment Year 2022-23 are not tenable and
the same are required to be quashed and set-aside.
10. Considering the facts of the case, the petition succeeds
and is accordingly allowed. The impugned Assessment Order
dated 23.03.2024 passed by the respondent under Section
143(3) read with Section 144B of the Act, and notice for
demand under Section 156 of the Act and penalty under section
274 read with Section 217AAC of the Act, of the same date are
hereby quashed and set aside.
11. The matter is remanded to the respondent - Assessing
Officer to pass a fresh de novo order, in accordance with law
after considering the reply of the petitioner as well as after
providing an opportunity of hearing to the petitioner.
12. Such exercise shall be completed within 12 weeks from
the date of receipt of copy of this order.
NEUTRAL CITATION
C/SCA/6741/2024 JUDGMENT DATED: 06/10/2025
undefined
13. Rule is made absolute to the aforesaid extent. No order as
to costs.
(BHARGAV D. KARIA, J)
(PRANAV TRIVEDI,J)
phalguni
