M/S. Southern Petro Chemical Industries, Corporation Ltd.,Rep. By Its Authorized Signatoryspic House, 88 Mount Road,Gunidy, Chennai – 600 032 v. The Deputy Commissioner Of Income Tax/Acit

W.P.No.26838, etc. of 2024 IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 11.09.2024Coram The Honourable Mr.Justice Krishnan Ramasamy W.P.Nos.26838,,26843, 26844, 26855 & 26864 of 2024 and W.M.P.Nos.29355, 29357, 29362, 29363, 29360, 29361,29379, 29383, 29371 and 29372 of 2024 M/s. Southern Petro Chemical Industries, Corporation Ltd.,Rep. By its Authorized SignatorySPIC House, 88 Mount Road,Gunidy, Chennai – 600 032. ...Petitioner in all W.Ps. Vs. The Deputy Commissioner of Income Tax/ACIT, Central Circle -1 (3)Chennai,No.320, M.G.Road, Nungambakkam,Chennai – 600 034. ...Respondent in all W.Ps. Prayer in W.PNo.26838 of 2024 Writ Petitions filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorarified Mandamus to call for records of the Petitioner on the file of Respondent and quash the Impugned Order passed by the Respondent under section 271(1)(c) of the Income Tax Act 1961 dated 31.07.2024 in DIN ITBA/PNL/M/271(1)(c)/2024- 1/11 W.P.No.26838, etc. of 2024 25/1067202115(1) for the Assessment Year 2003-04 in PAN and direct the Respondent to pass fresh order after granting reasonable opportunity. Prayer in W.PNo.26843 of 2024 :- Writ Petition filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorarified Mandamus to call for records of the Petitioner on the file of Respondent and quash the Impugned Order passed by the Respondent under section 271(1)(c) of the Income Tax Act 1961 dated 31.07.2024 in DIN ITBA/PNL/M/271(1)(c)/2024-25/1067202155(1) for the Assessment Year 2004-05 in PAN and direct the Respondent to pass fresh order after granting reasonable opportunity . Prayer in W.PNo.26844 of 2024 :- Writ Petition filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorarified Mandamus to call for records of the Petitioner on the file of Respondent and quash the Impugned Order passed by the Respondent under section 271(1)(c) of the Income Tax Act 1961 dated 31.07.2024 in DIN.ITBA/PNL/F/271(1)(c)/2024-25/1067203303(1) for the Assessment Year 2007-08 in PAN. and direct the Respondent to pass fresh order after granting reasonable opportunity to the Petitioner. 2/11 W.P.No.26838, etc. of 2024 Prayer in W.PNo.26864 of 2024 :- Writ Petition filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorarified Mandamus to call for records of the Petitioner on the file of Respondent and to quash the quash the Impugned Order passed by the Respondent under section 271(1)(c) of the IncomeTaxAct1961dated31.07.2024inDIN. ITBA/PNL/F/271(1)(c)/2024-25/1067203297(1) for the Assessment Year 2008-09 in PAN: and direct the Respondent to pass fresh order after granting reasonable opportunity to the Petitioner. Prayer in W.PNo.26855 of 2024 :- Writ Petition filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorarified Mandamus to call for records of the Petitioner on the file of Respondent and quash the quash the Impugned Order under section 271(1)(c) of the Income Tax Act 1961 dated 31.07.2024 in DIN ITBA/PNL/ F/271(1)(c)/ 2024-25/ 1067203298(1) for the Assessment Year 2009-10 in PAN Appearance of the counsel in All W.Ps:- For Petitioner: Mr.Vikram Vijayaraghavan for M/s. Subbaraya Aiyar Padmanabhan M/s. Subbaraya Aiyar Padmanabhan For Respondent : Mr.A.N.R. Jayaprathap, Junior Standing Counsel Junior Standing Counsel 3/11 W.P.No.26838, etc. of 2024 COMMON ORDER With consent, the Writ Petitions are taken up for final disposal at the stage of admission itself. Appearance of the counsel in All W.Ps:- For Petitioner: Mr.Vikram Vijayaraghavan for M/s. Subbaraya Aiyar Padmanabhan M/s. Subbaraya Aiyar Padmanabhan For Respondent : Mr.A.N.R. Jayaprathap, Junior Standing Counsel Junior Standing Counsel 3/11 W.P.No.26838, etc. of 2024 COMMON ORDER With consent, the Writ Petitions are taken up for final disposal at the stage of admission itself. 2. The challenge in these Writ Petitions is to the impugned orders passed by the respondent under Section 271(1)(c) of the Income Tax Act 1961 (in short, 'the Act') dated 31.07.2024 for the Assessment Years 2003-04; 2004-05; 2007-08; 2008-09 and 2009-10 and to direct the respondent to pass fresh orders after granting reasonable opportunity to the petitioner. 3. For the sake of brevity, the facts of the case are being taken from W.P.No.26838 of 2024, which are as follows:- i)Aggrieved against the assessment orders passed by the Assessing Officer for the AYs 2003-04; 2004-05; 2007-08; 2008-09 and 2009-10, the present filed an Appeal before CIT (Appeals) NFAC on 27.01.2009 and the said Appeal was partly allowed vide order dated 14.12.2022, against which, the petitioner filed second Appeal before the Income Tax Appellate Tribunal (ITAT) and the ITAT vide order dated 4/11 W.P.No.26838, etc. of 202410.01.2024, partly allowed the Appeal; that consequent to the order passed by ITAT, the Assessing Officer issued notice dated 19.07.2024, and called upon the petitioner to show cause as to why, order imposing penalty should not be made under Section 271(1) (c) of the Act, the petitioner, on receipt of said notice sought for two weeks, however, without granting sufficient time to the petitioner, the respondent passed order dated 30.07.2024 and the consequential order on 31.07.2024. Hence, the present Writ Petitions. 4. Mr.Vikram Vijayaraghavan, learned counsel for the petitioner would submit that pursuant to the orders passed by ITAT on 09.10.2024 and 10.01.2024 for AYs 2003-04; 2004-05; 2007-08; 2008-09 and 2009-10 respectively, notice under Section 274 read with 271(1)(c) dated 19.07.2024 was issued to the petitioner stating that ITAT has partially allowed the Appeals filed against the order of CIT(A) NFAC, and called upon the petitioner to show cause as to why, order imposing penalty should not be made under Section 271(1) (c) of the Act, and also asked the petitioner to appear in person, pursuant to which, the petitioner appeared in person, filed reply on 22.07.2024 and requested the respondent to grant two weeks time 5/11 W.P.No.26838, etc. of 2024 for filing reply, to which, the respondent issued letters dated 24.07.2024, stating that due to paucity of time, as the case is getting time barred on 31.07.2024, granted 5 days time to submit documentary evidence and though the petitioner sought time, the respondent passed orders giving effect order to the directions issued by CIT (Appeals) and ITAT on 30.07.2024, by rejecting the submission and details filed by the petitioner and very next date, i.e. on 31.07.2024 passed orders imposing penalty under Section 271 (1) (c) of the Act, dated 31.07.2024, which necessitated the petitioner to file present Writ Petitions. Therefore, the learned counsel contended that the impugned orders are liable to be set aside as the same suffer from violation of principles of natural justice. 5. Mr.A.N.R.Jayaprathap, learned Junior Standing Counsel, who takes notice on behalf of the respondent would submit that in terms of provision of the Income Tax Act, 1961, the respondent is supposed to pass the penalty order on or before six months and in the petitioner's case, the Appeals filed by the petitioner were partly allowed by the ITAT on 09.01.2024 and 10.01.2024 and the date, on which, the order passed by 6/11 W.P.No.26838, etc. of 2024 5. Mr.A.N.R.Jayaprathap, learned Junior Standing Counsel, who takes notice on behalf of the respondent would submit that in terms of provision of the Income Tax Act, 1961, the respondent is supposed to pass the penalty order on or before six months and in the petitioner's case, the Appeals filed by the petitioner were partly allowed by the ITAT on 09.01.2024 and 10.01.2024 and the date, on which, the order passed by 6/11 W.P.No.26838, etc. of 2024 ITAT is reckoned, the time period prescribed under the Act was about to expire on 31.07.2024, and though the petitioner has sought for two weeks' time, the respondent vide letter dated 24.07.2024, citing paucity of time to pass penalty orders, granted 5 days time, however, since the petitioner failed to utilize the opportunity granted, the respondent passed the order giving effect order to the directions issued by CIT (Appeals) and ITAT on 30.07.2024, by rejecting the submission and the details filed by the petitioner and very next date, i.e. on 31.07.2024, passed the penalty order (viz., the impugned order). 6. I have given due considerations to the submissions made on either side and perused the materials available on record. 7. On perusal of records, it is seen that aggrieved against the assessment orders passed by the Assessing Officer for the AYs 2003-04; 2004-05; 2007-08; 2008-09 and 2009-10, the petitioner filed Appeals before CIT (Appeals) NFAC on 27.01.2009 and the said Appeals were partly allowed vide order dated 14.12.2022, against which, the petitioner filed 7/11 W.P.No.26838, etc. of 2024 second Appeals before the Income Tax Appellate Tribunal (ITAT) and ITAT vide orders dated 09.01.2024 and 10.01.2024, partly allowed the Appeal. 7.1 Thus, when the ITAT passed orders as early as on 09.01.2024 and 10.01.2024, it is not known as to what prevented the respondent from acting in consequent to the order passed by ITAT immediately, rather than to wait till the fag end of six months' expiry time and to issue notice on one fine day, i.e., 19.07.2024, by quantifying the penalty amount and calling upon the petitioner to pay the penalty amount, the petitioner, who has issued with such notice all of a sudden, sought for two weeks' time to putforth their contention and to file supportive documents, which the respondent refused to grant citing the expiry of time period as reason for such refusal. 7.2 Thus, it is clear that the respondent remained a mute spectator for nearly five months, right from the date, on which, the orders were passed by ITAT i.e. on 09.01.2024 and 10.01.2024 and at the eleventh hour, the respondent issued notice dated 19.07.2024 and called upon the petitioner to show cause to why, penalty should not be imposed and though the petitioner 8/11 W.P.No.26838, etc. of 2024 appeared in person and sought time on two occasions, the respondent, without acceding to any of such request made by the petitioner, proceeded to pass orders, thereby, giving effect order to the directions issued by CIT (Appeals) and ITAT on 30.07.2024, by rejecting the submission filed by the petitioner and very next date, i.e. on 31.07.2024 passed the impugned orders imposing penalty under Section 271 (1) (c) of the Act, dated 31.07.2024, which is in violation of principles of natural justice. Hence, this Court is inclined to set aside the impugned orders. 8.Accordingly, this Court passes the following orders:- i)The impugned orders dated 31.07.2024 are set aside and the matters are remanded back to the respondent for fresh consideration. ii)The petitioner is directed to file all the documents available with them along with any additional reply, if any, within a period of two (2) weeks from the date of receipt of a certified copy of this order. (iii) Thereafter, the respondent is directed to issue a notice granting 21 days for the personal hearing of the petitioner, on which date, it is made clear that the petitioner 9/11 W.P.No.26838, etc. of 2024 8.Accordingly, this Court passes the following orders:- i)The impugned orders dated 31.07.2024 are set aside and the matters are remanded back to the respondent for fresh consideration. ii)The petitioner is directed to file all the documents available with them along with any additional reply, if any, within a period of two (2) weeks from the date of receipt of a certified copy of this order. (iii) Thereafter, the respondent is directed to issue a notice granting 21 days for the personal hearing of the petitioner, on which date, it is made clear that the petitioner 9/11 W.P.No.26838, etc. of 2024 shall appear and produce the documents and thereafter, the respondent is directed to consider the same and pass final orders in accordance with law determining the penalty, in terms of the orders passed by the ITAT dated 09.01.2024 and 10.01.2024 respectively. 9. In the result, the Writ Petitions are allowed. No costs. Consequently, connected Miscellaneous Petitions are closed. 11.09.2024 sd Index : yes/noNeutral Citation : yes/no ToThe Deputy Commissioner of Income Tax/ACIT,Central Circle -1 (3)Chennai,No.320, M.G.Road, Nungambakkam,Chennai – 600 034. Krishnan Ramasamy,J., sd 10/11 11/11 https://www.mhc.tn.gov.in/judis W.P.No.26838, etc. of 2024 W.P.Nos.26838,,26843, 26844, 26855 & 26864 of 2024 11.09.2024