Learned Counsel Smt.vani H., Appearing Forthe Petitioner Placing Reliance On The Division Benchjudgment Of This Court In The Case Ofm/S. Deepakextrusion Put. Lt v. The Deputy Commissioner Ofincome Tax In W.a

IN THR HIGH COURT OF KARNATAKA AT BENGALURU DATBD THIS THER DAY OF FEBRUARY, 2019 BEFORE: THR HON’BLE MRS. JUSTICK S.SUJATHA WRIT PETITION No.1374/2019 (TIT) BETWEEN: M/s SWADESH TRADING CO., |A PARTNERSHIP FIRMD.NO.2-43, BADRIYA COMPOUND|KAMBALABETTU, VITTAL MUDNOOR |BANTWAL-974211,DAKSHINA KANNADA, KARNATAKAREP. BY IIS KRSTWHILE PARINERSMT.KADBBJA MOHAMMBD ANDHUNIW/O ANDHUNI MOHAMMEDAGED ABOUT 57 YEARS |_.. PETITIONER| IBY SMT.VANI H., ADV.| AND: 1]DBPUTY COMMISSIONBR OFINCOME TAX, CENTRAL CIRCLE-1,ALBUQUERQUE HOUSE,PANDESHWAR, MANGALORE-575001INCOME TAX, CENTRAL CIRCLE-1,ALBUQUERQUE HOUSE,PANDESHWAR, MANGALORE-575001 oD THE ADDITIONAL COMMISSIONEROF INCOME TAX, CENTRAL RANGE,ALBUQUERQUE HOUSE,GROUND FLOOR, PANDESHWARMANGALORE -57500 ~_ RESPONDENTS [BY SRI E.I.SANMATHI, ADV.) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND22/7 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THEASSESSMENTORDERDATED26.12.2018FORTHEASSEBSSMEBNT YRBAR 2011-12 PASSBD BY THERE R-1 U -9.- SECTION 143(2) R/W SECTION 147 OF THE INCOME-TAX ACT,|1961 VIDE ANNEX-P AND THE CONSEQUENTIAL DEMAND|NOTICK DATED 26.12.2018 VIDE ANNEX-P1. THIS PETITION COMING ON FOR PRELIMINARY HEARING|IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:- ORDER The present writ petition arises against theAssessment Order dated 26.12.2018 passed by therespondent No.1 under Section 143(2) read with Section147 of the Income Tax Act, 1961 (‘Act’ for short) relatingto the Assessment Year 2011-12 and the consequentialdemand notice dated 26.12.2018 as well as the’directions dated 28.11.2018 issued under Section 144A|of the Act by the respondent No.2. oD In order to appreciate the contentions of theparties, it is apt to refer to the relevant facts. | 3.|For the Assessment Year 2011-12, thepetitioner has filed return of income which wasprocessed under Section 143(1) of the Act. A surveyunder Section 133A oft the Act was conducted on -3- 24.11.2015 in the business premises of the petitioner. |Pursuant to the said survey, a notice dated 27.03.2018.under Section 148 of the Act was issued by therespondent No.1 proposing the reassessment. On therequest made by the petitioner, copy of the reasonsrecorded for initiating the reassessment proceedingswas made over to the petitioner on 05.10.2018. Thepetitionerfiled|objections|OTL15.10.2018and17.10.2018 to the notice issued by the respondent No.1.under Section 148 of the Act. Meanwhile, petitionermade representation under Section 144A of the Actbeforetherespondent.No.2seekingdirections. |Accordingly, respondent No.2 passed an order on28.11.2018 issuing directions to the respondent No.1,the relevant direction reads as under:- “The assessee has also credited otherreceiptsOTLVATIOUSdatesamountingtoRs.1,07,025/-, the sources of these receipts arenot known. Further, it is also not clear whether|the amount given was fully repaid or not. Allthe above facts leads to a conclusion that theassessee has arranged this fund out of the funds of the borrower. Since, the said loan has|already been assessed in the hands of Sri.M.A. Siddique, Supreme Industries, and theissue 1S before the Appellate Authority, the taxon the same addition in the hands of M/s.Swadesh Trading Co. may be kept in abeyancetill the issue reaches its finality. As regards|the other proposed addition is concerned, the|A.O. is directed to verify the same and|conclude the assessment as per law. Accordingly, the Assessing Officer ishereby directed u/s 144A of the IT. Act, toDassanappropriate order|aftergivingadequateopportunityof|hearing|tothe|assessee”. | 4In compliance of the directions issued by therespondent No.2, the respondent No.1 concludedassessment proceedings and an order has been passedon 26.12.2018 aiter providing an opportunity of hearingto the petitioner and considering the objections filed. Accordingly, the Assessing Officer ishereby directed u/s 144A of the IT. Act, toDassanappropriate order|aftergivingadequateopportunityof|hearing|tothe|assessee”. | 4In compliance of the directions issued by therespondent No.2, the respondent No.1 concludedassessment proceedings and an order has been passedon 26.12.2018 aiter providing an opportunity of hearingto the petitioner and considering the objections filed. 5.|Learned counsel Smt.Vani H., appearing forthe petitioner placing reliance on the Division Benchjudgment of this Court in the case ofM/s. DeepakExtrusion Put. Ltd., vs. The Deputy Commissioner ofIncome Tax in W.A.No.1725/2017 (T-IT) dated -5- 15.03.2017, would submit that the Assessing Officer.failed to dispose of the objections prior to passing there-assessment order whichis mandatory requirementand the same not having’ ~been followed,exercise of power can be said without jurisdiction. —Reliance is also placed on the order of this Court in the case oftM/s. Wartyhully Estates Limited vs. The Income|TaxOfficerandanother in|W.P.No.4679/2018 (T-IT) dated 21.03.2018. 6.|Learned counsel for the revenue supports|the impugned order. TS|I have carefully considered the arguments.advanced by the learned counsel for the parties andperused the material on record. 8.|It is not in dispute that the petitioner has|moved before the respondent No.2 under Section 144Aof the Act seeking directions to respondent No.1 during the pendency of the reassessment proceedings undersection 143(3) read with Section 147 of the Act. It ishardly required to be stated that the respondent No.1 isbound by the directions issued by the respondent No.2in terms of the order passed under Section 144A of theAct. That being the fact situation, the order impugnedis passed by respondent No.1. It is the grievance of thepetitioner that no decision has been taken by therespondent No.lon the objections relating to thejurisdiction prior to passing of the order impugned. —This argument of the learned counsel for the petitionercannot be countenanced for having invited an orderunder Section 144A of the Act by respondent No.2. QO In the circumstances, this Court is of theconsidered view that the judgments relied upon by thepetitioner are distinguishable for the reason that noorder under Section 144A of the Act was considered in the said cases. -~Tf- 1Q.|Be that as it may, without going into themerits or demerits of the order impugned, writ petitionstands disposed of with liberty to file an appeal beforean appropriate authority in accordance with law. If suchan appeal is filed within a period of two weeks from thedate of receipt of certified copy of the order, the sameshall be considered on merits without objecting to theperiod of limitation, subject to other procedures to befollowed by the petitioner/assessee. _ All rights and contentions of the parties are leit Open). PMR Sd/-—JUDGE