Mumbai High Court holds that assessment order passed with only three days’ response time to show cause notice issued under Section 144B(6)(xvi) violates natural justice and is liable to be quashed notwithstanding time-barring assessment plea; Court remands the matter to Revenue with the direction to consider the objections to the SCN issued under Section 144B, which shall be filed by the Assessee within two month from date of passing of this order and to enable the system accordingly, after giving Assessee an opportunity of being heard in terms of Section 144B(6)(vii); Notes that it is disputed fact that show cause notice was issued on 24.03.2022 and merely gave 3 days’ time to the Assessee to file its response on the premise that the assessment proceedings were getting time barred, however, the time limit for completion of assessment for relevant Assessment year was subsequently extended up to 30.09.2022; High Court remarks that even after assuming that time limit extended subsequently, the Assessing Officer was mandated to comply with CBDT SOP by granting atleast 7 days to the Assessee to reply to SCN once the aforesaid time limit stood extended; Thus, Court opines that Assessing Officer had adequate time not only to pass the assessment order but also comply with CBDT SOP by giving 7 days’ time to Assessee; Assessee, for the Assessment year 2020-21, was issued a show cause notice under Section 144B(6)(vii) on 24.03.2022, requiring Assessee to file the response by 27.03.2022, giving Assessee 3 days’ time to file the response; Assessee preferred the present writ petition challenging the assessment order on the ground that the above stated SCN was issued on violation of CBDT SOP mandating atleast 7 days’ time period and did not provide Assessee a reasonable opportunity of filing the response; High Court rejects Revenue’s contention that SOP was issued on 03.08.2022 i.e., after passing of assessment order and applies prospectively and opines that giving only 3 days’ time to respond to show cause notice would be highly inadequate and a bare minimum of seven days out to be given to the Assessee and the subsequent issuance of CBDT SOP would not make any difference, thereby allowing Assessee’s writ petition.

[In favour of assessee] 
[Dhiraj Lakhamshi Shah v. Assessing Authority National Faceless Assessment Centre, Delhi & Ors. [TS-1717-HC-2025(BOM)] – Date of Judgement : 17.12.2025 (Bom.)]