In View Of The Decision Of Hon’ble Supreme Courtin The Case Of Union Of India & Ors v. After Considering The Reply And The Submissions The Impugned

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 8 DAY OF DECEMBER 2023 / 17TH AGRAHAYANA, 1945WP(C) NO. 20400 OF 2023 PETITIONER: SHAJU PACHELIL PATHROSE,AGED 57 YEARS, XI/276A, PACHELIL HOUSE, MUDAVOOR P. O., VAZHAPPILLY,MUVATTUPUZHA, PIN – 686669. BY ADVS. SRI. ABRAHAM JOSEPH MARKOS SRI. SHARAD JOSEPH KODANTHARA SRI. ISAAC THOMAS SRI. ALEXANDER JOSEPH MARKOS SRI. JOHN VITHAYATHIL SRI. P. G.CHANDAPILLAI ABRAHAM SRI. AIBEL MATHEW SIBY RESPONDENTS: 1THE ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX OFFICER, NATIONAL E-ASSESSMENT CENTRE, NEW DELHI, PIN – 110001.2THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, AYAKKAR BHAVAN, OLD RAILWAY STATION ROAD, KOCHI, PIN – 682018.3THE INCOME TAX OFFICER,MUVATTUPUZHA, PIN – 686669. BY ADV. SRI. CHRISTOPHER ABRAHAM – SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON08.12.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: DINESH KUMAR SINGH, J. -------------------------- W.P.(C) No.20400 of 2023 ------------------------- Dated this the 8[th] day of December, 2023 JUDGMENT 1.The present writ petition has been filed by the petitionersimpugning the assessment order dated 24.05.2023 in Exhibit P-11passed under Section 147 read with Section 144B of the Income TaxAct, 1961 and Exhibit P-14 penalty notice dated 24.05.2023 issuedunder Section 274 read with Section 271 (1) (c) of the Income TaxAct, 1961. 2.Information was flagged in the case of the petitioner inaccordance with the risk management strategy formulated by theCentral Board of Direct Taxes. The assessment in the case was re-opened by issuing notice under Section 148 dated 28.06.2021. Thereasons for re-opening of the assessment was assigned as under; “The assessee has made high value cashtransactions. Total credit during the period01.01.2015 to 31.12.2015 is amounted to Rs. 6.91crores out of which cash deposits is Rs. 5.88crore, clearing is Rs. 41.22 lakhs, RTGS is Rs.38.59 lakhs, NEFT is Rs. 19.55 lakhs. In view of the decision of Hon’ble Supreme Courtin the case of Union of India & Ors. v. AshishAggarwal [ 2022 SCC Online SC 543], the saidnotice was treated to be a notice under Section148A (b) of the IT Act, 1961. TheInformation/material relied upon for receiving thesaid notice was provided to the petitioner/assesseeby the Assessing Authority on 24.05.2022 and thepetitioner was asked to file reply to the saidnotice. In response to the said notice, thepetitioner has furnished his reply. Afterconsidering the reply furnished by the petitionerto the notice under Section 148A (b) of theIncome Tax Act, the Authority was of the opinionthat it was a fit case for reopening and the casewas reopened issuing notice under Section 148dated 29.06.2022.” 3.After considering the reply and the submissions the impugned assessment order has been passed and total taxable income hasbeen determined to be Rs. 6,48,29,2113/- with addition of Rs.6,36,70,393/- under Section 69A of the Income Tax Act. The demandnotice for payment of tax was also annexed with the assessmentorder and direction was issued to initiate penalty proceedings. 4.The learned Counsel for the petitioner submits that the ShowCause Notice issued to the petitioner on 03.05.2023 asking thepetitioner to file reply by 06.05.2023 was responded by the petitioner/assessee and request for time to file the reply was madeup to 20.05.2023. This fact is evident from Exhibit P-8, print outtaken from the website of the Department. The petitioner wasissued against a notice on 17.05.2023 and the petitioner asked forfurther time to 07.06.2023. In the meantime, the impugnedassessment order has been passed on 24.05.2023. 4.The learned Counsel for the petitioner submits that the ShowCause Notice issued to the petitioner on 03.05.2023 asking thepetitioner to file reply by 06.05.2023 was responded by the petitioner/assessee and request for time to file the reply was madeup to 20.05.2023. This fact is evident from Exhibit P-8, print outtaken from the website of the Department. The petitioner wasissued against a notice on 17.05.2023 and the petitioner asked forfurther time to 07.06.2023. In the meantime, the impugnedassessment order has been passed on 24.05.2023. 5.The petitioner admittedly did not filed reply even up to theextended time asked by him up to 20.05.2023. Though the secondShow Cause Notice was issued again the petitioner asked time anddid not filed reply. It is relevant to take note of the fact that inrespect of the first show cause notice the petitioner had asked timeup to 20.05.2023 and it was granted to him, which is evident from Exhibit P-8. The petitioner did not file reply and therefore, theAuthority was well within its power not to grant further time for thepetitioner. Therefore, I do not find much substance in thesubmission that there is violation of the principles of natural justice.Petitioner cannot go on asking for time one after another inresponse to the show cause notice issued one after another.Therefore I do not find any ground to interfere with the impugnedorder or notice. The petitioner has remedy of filing the appeal against the assessment order. Petitioner instead of filing the appealhas approached this Court in this writ petition. Considering the factthat this writ petition has remained pending on file of this Court,the petitioner is permitted to file the appeal within period of fifteendays from today before the Appellate Authority and if thepetitioner files the appeal against the assessment order withinfifteen days, the Appellate Authority shall proceed to examine theappeal on merit as well as the stay application if any, filed alongwith the appeal. It is made clear that the Appellate Authority willnot get into the question of limitation and the appeal should beheard and decided on merit inasmuch as this writ petition has beenremain pending in the file of this Court. For a period of fifteen daysno coercive steps shall be taken against the petitioner in pursuanceto Exhibit P-11 impugned assessment order. The stay applicationshould be decided expeditiously, preferably within a period of twomonths from the date of its filing. Svn Sd/- DINESH KUMAR SINGH JUDGE APPENDIX OF WP(C) 20400/2023 PETITIONER’S EXHIBITS EXHIBIT P1TRUE COPY OF THE NOTICE DATED 06.01.2023 ISSUED UNDER SECTION 143(2) READ WITH SECTION 147 OF THE INCOME TAX ACT, 1961 BY THE 1ST RESPONDENT TO THE PETITIONERISSUED UNDER SECTION 143(2) READ WITH SECTION 147 OF THE INCOME TAX ACT, 1961 BY THE 1ST RESPONDENT TO THE PETITIONER EXHIBIT P2TRUE COPY OF THE ACKNOWLEDGEMENT AND REPLY DATED 19.01.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENTDATED 19.01.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT EXHIBIT P3TRUE COPY OF THE NOTICE DATED 10.04.2023 ISSUED UNDER SECTION 142(1) OF THE INCOME TAX ACT, 1961 BY THE 1ST RESPONDENTISSUED UNDER SECTION 142(1) OF THE INCOME TAX ACT, 1961 BY THE 1ST RESPONDENT EXHIBIT P4TRUE COPY OF THE ACKNOWLEDGEMENT AND REPLY DATED 12.04.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENTDATED 12.04.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT EXHIBIT P5TRUE COPY OF THE NOTICE DATED 24.04.2023 ISSUED BY THE 1ST RESPONDENT TO THE PETITIONERISSUED BY THE 1ST RESPONDENT TO THE PETITIONER EXHIBIT P6TRUE COPY OF THE REPLY DATED 24.04.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENTFILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT EXHIBIT P3TRUE COPY OF THE NOTICE DATED 10.04.2023 ISSUED UNDER SECTION 142(1) OF THE INCOME TAX ACT, 1961 BY THE 1ST RESPONDENTISSUED UNDER SECTION 142(1) OF THE INCOME TAX ACT, 1961 BY THE 1ST RESPONDENT EXHIBIT P4TRUE COPY OF THE ACKNOWLEDGEMENT AND REPLY DATED 12.04.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENTDATED 12.04.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT EXHIBIT P5TRUE COPY OF THE NOTICE DATED 24.04.2023 ISSUED BY THE 1ST RESPONDENT TO THE PETITIONERISSUED BY THE 1ST RESPONDENT TO THE PETITIONER EXHIBIT P6TRUE COPY OF THE REPLY DATED 24.04.2023 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENTFILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT EXHIBIT P7TRUE COPY OF THE SHOW CAUSE NOTICE DATED 03.05.2023 ISSUED UNDER SECTION 144B OF THE INCOME TAX ACT BY THE 1ST RESPONDENT TO THE PETITIONER03.05.2023 ISSUED UNDER SECTION 144B OF THE INCOME TAX ACT BY THE 1ST RESPONDENT TO THE PETITIONER EXHIBIT P8TRUE COPY OF RESPONSE WITH ACKNOWLEDGEMENT OF THE PETITIONEROF THE PETITIONER EXHIBIT P9TRUE COPY OF THE SHOW CAUSE NOTICE DATED 17.05.2023 ISSUED BY THE ASSESSING OFFICER17.05.2023 ISSUED BY THE ASSESSING OFFICER EXHIBIT P10TRUE COPY OF THE RESPONSE DATED 18.05.2023 FILED BY THE PETITIONER AND DULY ACKNOWLEDGED BY THE DEPARTMENTFILED BY THE PETITIONER AND DULY ACKNOWLEDGED BY THE DEPARTMENT EXHIBIT P11TRUE COPY OF THE ASSESSMENT ORDER DATED 24.05.2023 ISSUED BY THE ASSESSING OFFICER24.05.2023 ISSUED BY THE ASSESSING OFFICER EXHIBIT P12 TRUE COPY OF THE JUDGMENT DATED 22.11.2021 OF THIS HONOURABLE COURT IN W.P. (C) NO.21524 / 2021 EXHIBIT P13TRUE COPY OF THE JUDGMENT DATED 08.06.2023 OF THIS HONOURABLE COURT IN W.P. NO.15590 / 2023OF THIS HONOURABLE COURT IN W.P. NO.15590 / 2023 OF THIS HONOURABLE COURT IN W.P. NO.15590 / EXHIBIT P14TRUE COPY OF THE PENALTY NOICE DATED 24.05.2023 ISSUED BY THE 1ST RESPONDENT TO THE PETITIONER24.05.2023 ISSUED BY THE 1ST RESPONDENT TO THE PETITIONER