Assessee Not Informed AO about Income Tax Assessment Objections

The Bombay High Court imposed a cost of Rs 10,000 on a petitioner for failing to inform the Assessing Officer (AO) that their objections to a draft assessment order were pending before the Dispute Resolution Panel (DRP). Due to this communication lapse, the AO proceeded to pass a final assessment order, while the DRP proceedings were still active. The court noted that while the petitioner's failure to inform the AO led to the error, the final order passed by the AO was procedurally incorrect. To balance the equities, the court set aside the final assessment order, thereby allowing the DRP to proceed. However, it penalized the petitioner for their lapse, which caused procedural complications. The cost was directed to be paid to the High Court employees' medical welfare fund, sending a message about the importance of keeping all relevant authorities informed during tax proceedings.