III. Judicial Pronouncement
1. KANUBHAI M PATEL HUF Vs. HIREN BHATT OR HIS SUCCESSORS TO OFFICE & 4, SPECIAL CIVIL APPLICATION No. 5295 of 2010, Date: 13/07/2010, HIGH COURT OF GUJARAT
For purposes of s. 149, the expression “notice shall be issued” means that the notice should go out of the hands of the AO. On facts, though the notice was signed on 31.3.2010, it was sent to the speed post center for booking only on 7.4.2010. Considering the definition of the word “issue”, merely signing the notices on 31.3.2010 cannot be equated with “issuance of notice” as contemplated u/s 149. The date of issue would be the date on which the same was handed over for service to the proper officer, which in the present case would be the date on which the notices was actually handed over to the post office for the purpose of booking for the purpose of effecting service on the assessee. Till the point of time the envelopes are properly stamped with adequate value of postal stamps, it cannot be stated that the process of issue is complete. As the notice was sent for booking to the Speed Post Center on 7.4.2010, the date of “issue” of the notice would be 7.4.2010 and not 31.3.2010, which is beyond the limitation period. Consequently, the reassessment cannot be sustained.
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2. Hyundai Heavy Industries Ltd Vs. The Union of India and others, Civil Writ Petition No. 1778 of 2010 (M/S), HIGH COURT OF UTTARAKHAND, Dated 21st July, 2011
Pursuant to s. 147 reopening and a draft assessment order u/s 144C, the assessee filed objections before the Dispute Resolution Panel (DRP). As the Director of Income Tax (International Taxation)-II (DIT-IT) who had granted approval to the reopening and had supervised the passing of the draft assessment order was a member of the DRP, the assessee requested him to recuse himself from the panel on the ground that there was a “conflict of interest”. As the DIT-IT declined to do so and participated in the proceedings and finalized the draft assessment order, the assessee filed a Writ Petition contending that the jurisdictional CIT should not be a part of the DRP.
Held : As the DIT-II was exercising supervisory functions over the AO, the real likelihood of “official bias” cannot be ruled out. Even if the officer is impartial and there is no personal bias or malice, nonetheless, a right minded person would think that in the circumstances, there could be a likelihood of bias on his part. In that event, the officer should not sit and adjudicate upon the matter. He should recuse himself. This follows from the principle that justice must not only be done but seen to be done. In order to ensure that no person should think that there is a real likelihood of bias on the part of the officer concerned, the CBDT is directed to ensure that a jurisdictional Commissioner is not nominated as a member of the DRP under Rule 3 (2) of the Rules. By doing this, the principle that justice must not only be done but seen to be done would be ensured.
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