Commissioner Of Income Tax-Ii Ludhiana v. M/S Patiala Carriers & Another

-|-SAILESH RANJAN2015.05.15 10:12I attest to the accuracy andintegrity of this document IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH CWP? No.867 of 2015Date of decision:13.05.2015 Commissioner of Income Tax-II LudhianaVersus — Petitioner M/s Patiala Carriers & another ......Respondents CORAM:HON'BLE MR.JUSTICE S.J.VAZIFDAR, ACTING CHIEF JUSTICEHON'BLE MR.JUSTICE G.S.SANDHAWALIA Present:Mr.Rajesh Katoch, Advocate, for the petitioner. None for the respondents. ,,,, S.J.Vazifdar, Acting Chief Justice(Oral): 1)Rule. Rule returnable and heard finally.2 Vide order dated 19.01.2015, notice of motion was issued for17.03.2015. Though the respondents were duly served, they were not present on17.03.2015. They are not present today also. We, accordingly, proceed to decidethe writ petition. 3)The petitioner has challenged the order of the Income TaxSettlement Commission, New Delhi (for short, the ‘ITSC'), calculating the totalincome at.430,96,000/- and directing the Assessing Authority to calculate the taxwith interest, accordingly. Certain other directions were also issued by the ITSC. 4 The hearing before the ITSC were held between 12.09.2000 to10.01.2014. Thereafter, the ITSC addressed a letter dated 25.04.2014 (wronglytyped as 25.04.2013). However, the contents of the letter itself indicate thetypographical error. The letter reads as under: “| am directed to refer to the subject mentioned above and to drawyour attention to the Hon'ble Punjab and Haryana High Court'sorder dated 03/02/1997 in C.\W.P. No.19303 of 1996 In which th Honbie Court nad given certain direction to the Income laxAutnorities wnicn Is reproduced below: “We direct the resoondent No.2 to send complete information ofthe payments made by M/s Patiala Carriers (Regd.) to theconcerned Income lax Authorities and we hope that appropriatesteps will be taken by the Income Tax Department for making athorough investigation regarding the source from which M/s PatialaCarriers has made payment of amount of penalty.| 2. in view of the Hon ble Punjab & Haryana High Courts order, youare directed to make an investigation regarding the source fromwhich M/s Patiala Carriers has made payments of amount ofpenalty and also to ascertain the capacity/status of the parties whoactually made payments of the penalties vide the copies of SalesTax Department's penalty/detention orders as forwarded by theAssessing Officer to ITSC vide letter dated 10/14/2014. In thisregard your report should reach this office by 15.5.2014 positively.” 5 The petitioner's grievance is that it was not granted adequate time tofurnish the necessary information. The grievance is justified, for more than onereason. Firstly, it is pursuant to the orders of this Court that the information wasdirected to be sent to the Income Tax authorities. The Division Bench expressedthe hope that appropriate steps would be taken by the Income Tax Department forconducting thorough enquiry regarding the source from which _ theassessee/respondents, had paid the penalty. The impugned order was passed on28.05.2014 (Annexure P15). In the facts and circumstances of the case, the ITSC ought to havegranted the petitioner adequate time to furnish the information. 6.Reliance upon Section 245D(3) of the Income Tax Act, 1961, is alsowell founded. The petitioner is entitled to at least 90 days to produce theinformation. Therefore, the observations of the ITSC, especially in paragraphsNo.16 & 17 of the impugned order were not justified. T Accordingly, the impugned order dated 28.05.2014 (Annexure P15),passed by the ITSC, is quashed and set aside. The matter is remanded to the -3-SAILESH RANJAN2015.05.15 10:12I attest to the accuracy andintegrity of this document ITSC, to pass a fresh order, after affording both the parties an opportunity ofbeing heard. The information sought vide the said letter dated 25.04.2014, shallbe furnished, latest by 13.08.2015. The writ petition is, accordingly, disposed of, (S.J.Vazifdar)Acting Chief Justice 13.05.2015sailesh | (G.S.Sandhawalia)Judge