Intellisys Technologies Andresearch Pvt. Ltd v. Assistant Commissioner Of Incometax (Tds), Circle 2/1, Kolkata Andors

O-81 APOT/123/2022IA No.GA/1/2022 IN THE HIGH COURT AT CALCUTTACivil Appellate JurisdictionORIGINAL SIDE INTELLISYS TECHNOLOGIES ANDRESEARCH PVT. LTD. -Versus- ASSISTANT COMMISSIONER OF INCOMETAX (TDS), CIRCLE 2/1, KOLKATA ANDORS. Appearance:Mr. Agnibesh Sengupta, Adv.Mr. Indranil Banerjee, Adv.Mr. subrata Mukherjee, Adv....for the appellant.Mr. Vipul Kumdalia, Adv.Mr. Amit Sharma, Adv.Mr. Anurag Roy, Adv....for the respondent. BEFORE: The Hon’ble JUSTICE T.S. SIVAGNANAM -And- The Hon’ble JUSTICE SUPRATIM BHATTACHARYA Date : 6[th] September, 2022. The Court : This intra-Court appeal filed by the appellant/writ petitioner is directed against the order dated 13[th]June, 2022 in WPO/2053/2022. The appellant had filed the writpetition challenging a notice issued by the respondent namely,Assistant Commissioner of Income Tax, Circle-2(1), Kolkata underSection 221 of the Income Tax Act, 1961. The writ petition wasdismissed without going into the merits of the matter and giving liberty to the appellant to go before the authority and agitateall points. The appellant is before us being aggrieved by suchorder.The learned Tribunal appearing for the appellant wouldstrenuously contend that the penalty notice issued under Section221 of the Income Tax Act is ex facie unsustainable as it isbarred by limitation. Secondly, it is contended that theauthority has no jurisdiction to issue notice under Section 221 ofthe Act without declaring the assessee as an ‘assessee indefault’. Furthermore, the learned Advocate would submit that onmerits they have substantially made a case and without consideringthis aspect, the learned single Bench had dismissed the writpetition. The learned standing counsel opposing the relief soughtfor, has drawn our attention to the conduct of the assessee andsubmitted that at least five communications have been sent to theassessee and, till date, the assessee has not given a properresponse. On more than five occasions of that, the assessee hassought for adjournments. Further, it is submitted that thelearned writ Court has sufficiently safeguarded the interest ofthe appellant by directing the appellant to go before theauthority and raise all contentions.Having elaborately heard the learned Advocates for theparties, we are in agreement with the view taken by the learnedwrit Court since the proceedings which are impugned in the writ petition was only a show cause notice issued proposing to levypenalty under Section 221 of the Act. If according to theappellant, the authority who issued the notice does not havejurisdiction, and that the show cause notice is barred bylimitation, nothing prevents the appellant from raising suchcontention before the very same authority who had issued the showcause notice who would be well within his jurisdiction to rule asto how the show cause notice is maintainable and how he hasjurisdiction to issue the same and as to how it is not barred bylimitation. Therefore, in such proceedings, the High Court shouldseldom interfere and interdict the process.We find that after receipt of the show cause notice, theappellant has sent a reply on 16[th] February, 2022 wherein they havestated that the conditions precedent for invoking the power underSection 221 of the Act have not been satisfied and they havedenied and disputed the liability to pay penalty. We find thatthe reply dated 16[th] February, 2022 does not clearly set out thefactual position and appears to be a very brief reply. Therefore,we are of the view, that while affirming the order passed by thelearned Single Bench by directing the appellant to go before thevery same authority, we are inclined to issue certain otherdirections so that an effective adjudication is done by theconcerned authority. For the above reasons, the appeal (APOT/123/2022) standsdisposed of by directing the appellant/assessee to submit a freshreply to the show cause notice within a period of 15 days from thedate of receipt of a server copy of this order. On receipt of thereply, the authority concerned shall fix a date for personalhearing either virtually or through physical mode for hearing theassessee or their authorized representative and thereafter pass areasoned order on merits and in accordance with law. While takinga decision, the authority shall specifically deal with the issuesrelating to jurisdiction and limitation that is being canvassed bythe appellant/assessee. Till such orders are passed in terms ofthe above direction, no coercive action shall be initiated againstthe appellant.Consequently, the connected application for stay (IANo.GA/1/2022) also stands disposed of. (SUPRATIM BHATTACHARYA, J.) S.Das/As.