Oasys Green Tech Private Limited v. The Income Tax Officer, Ward 3(2), 4[Th] Floor, Main Building, Williams Road, Contonment, Thiruchirapalli-620 015

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT THE HONOURABLE MR.JUSTICE ABDUL QUDDHOSE W.P.(MD)No.2897 of 2020 and W.M.P.(MD)Nos.2445 and 2446 of 2020 Oasys Green Tech Private Limited,7, Allisalai, Annamalai Nagar,Thiruchirapalli- 620 018.: Petitioner Vs. 1.The Income Tax Officer, Ward 3(2), 4[th] Floor, Main Building, Williams Road, Contonment, Thiruchirapalli-620 015. 2.The Income Tax Officer, Ward 1(2), 4[th] Floor, Williams Road, Contonment, Thiruchirapalli-620 015. : Respondents Ward 1(2), 4[th] Floor, Williams Road, Contonment, Thiruchirapalli-620 015. : Respondents PRAYER:- Petition filed under Article 226 of the Constitution ofIndia seeking a Writ of Certiorari calling for the records of therespondents contained in its assessment order bearing LetterNo.ITBA/COM/F/17/2019-20/1023538193(1), dated 31.12.2019 passedunder Section 144 r/w Section 147 of the Income Tax Act, 1961 forPAN:AAFCK6406Q in AY-2012-13 and to quash the same as arbitrary,unjust and illegal. For Petitioner:Mr.Suhrith Parthasarathy for Mr.Arun Karthick MohanFor Respondents:Mr.N.Dilip Kumar**** For Respondents ORDER (This petition was heard through the Video Conferencing) This Writ Petition has been filed challenging the assessmentorder, dated 31.12.2019 passed under Section 144 r/w Section 147 ofthe Income Tax Act, 1961, for the assessment year 2012-13. https://hcservices.ecourts.gov.in/hcservices/ 2.Heard Mr.Suhrith Parthasarathy, learned Counsel for Mr.ArunKarthick Mohan, learned Counsel for the petitioner and Mr.N.DilipKumar, learned Counsel for the respondents. 3.The primary ground for challenge to the impugned assessmentorder is that the petitioner was not given any opportunity to seekthe reasons for reopening the assessment or submit his objections tothe reopening of the assessment in accordance with the principleslaid down by Honourable Supreme Court in the case of GKN Driveshaftsvs. Income Tax Officer, reported in (2003) 1 SCC 72, for reopeningof assessment. According to the petitioner, the respondents havewrongly stated in the assessment order that “the assessee has noteven attempted to file a return stating that the e-portal systemshown an error not allowing to file the return of income”. 4.It is the case of the petitioner that they have taken allefforts to upload the return of income for the assessment year 2012-13 in the manner suggested by the respondents in its own letter,dated 29.11.2019. It is also the case of the petitioner that the e-portal system maintained by the respondents does not permit acompany, which has been amalgamated with another company, to filetheir returns electronically. It is the case of the petitioner thatthey cannot file the returns on behalf of the company, namely,M/s.OAS Digital Infrastructure Private Limited, which has beenmerged with the petitioner under an amalgamation order passed by theMadras High Court. In such circumstances, on the ground ofviolation of principles of natural justice by the respondents whilepassing the impugned assessment order and on the ground that theimpugned assessment order has been passed without authority underlaw, the present Writ Petition has been filed. 5.A counter has been filed by the respondents denying theallegations of the petitioner. According to them, though severalopportunities were granted to the petitioner to file the returns,the petitioner has not filed the returns in the proceedingsinitiated under Section 147 of the Income Tax Act, 1961, forreopening of assessment. It is also their contention that at nopoint of time, the petitioner had requested the respondents to filethe returns manually. 5.A counter has been filed by the respondents denying theallegations of the petitioner. According to them, though severalopportunities were granted to the petitioner to file the returns,the petitioner has not filed the returns in the proceedingsinitiated under Section 147 of the Income Tax Act, 1961, forreopening of assessment. It is also their contention that at nopoint of time, the petitioner had requested the respondents to filethe returns manually. 6.It is also the contention of the respondents, as seen fromthe counter affidavit that even prior to the merger with thepetitioner's company, M/s.OAS Digital Infrastructure PrivateLimited, never filed their returns with the respondents. Accordingto the respondents, since the petitioner did not file any return ofincome, they are not entitled for any indulgence by this Court. Therespondents have passed the impugned assessment order against thepetitioner on the ground that M/s.OAS Digital Infrastructure PrivateLimited, received payments under various Sections of the Income TaxAct, 1961, as detailed hereunder:https://hcservices.ecourts.gov.in/hcservices/ “a.ContractreceiptsunderSectionRs.1,61,50,354/- 194C- b.Professional receipts under Section 194J-Rs.23,76,976/- and c.Interest receipts under Section 194J-Rs.5,040/- totalling to the tune of Rs.1,85,32,370/- which had escaped assessment. d.That apart there was an unexplained cash depositto the tune of Rs.12,59,140/- during the period from01.04.2011 to 31.03.2012.” 7.According to them, they have not violated the principles ofnatural justice and they have granted sufficient opportunity to thepetitioner to file their returns in the reopening of assessmentproceedings and therefore, principles of natural justice has notbeen violated under the impugned assessment order. 8.It is not in dispute that there is no provision for filing ofthe income tax returns electronically under the e-portal systemmaintained by the respondents in respect of a company, which hasbeen merged with another company pursuant to an amalgamation orderpassed by a Court. The respondents have reopened the assessmentunder Section 147 of the Income Tax Act, 1961, on the ground thatM/s.OAS Digital Infrastructure Private Limited, has suppressedcertain incomes before their merger with the petitioner company on01.02.2015. 9.It is settled law that the petitioner should be givensufficient opportunity and fair hearing to raise all objectionsavailable to them under law with regard to the reopening of anyassessment. The learned Counsel for the petitioner drew theattention of this Court to the attempts made by the petitioner tofile the returns electronically with regard to the allegedsuppression of income made by M/s.OAS Digital Infrastructure PrivateLimited. According to the petitioner, the returns filed by thepetitioner subsequent to the initiation of reopening of theassessment proceedings by the respondents were returned with anerror report, since the e-portal of the respondents does not permita company, which has been merged with another company pursuant to anamalgamation order passed by a Court, to submit its reportelectronically. 10.It is also an admitted fact that the current Income TaxRules does not permit filing of returns manually. While that be so,the benefit of doubt should be given to the assessee. It is thecase of the petitioner that they were unable to submit the returnsdue to the fact that the e-system portal of the respondents does notenable a company, which has been merged with another companypursuant to an amalgamation order passed by a Court, to file itsincome tax returns manually. The petitioner having produced theerror report of the respondents will clearly establish that thehttps://hcservices.ecourts.gov.in/hcservices/ 10.It is also an admitted fact that the current Income TaxRules does not permit filing of returns manually. While that be so,the benefit of doubt should be given to the assessee. It is thecase of the petitioner that they were unable to submit the returnsdue to the fact that the e-system portal of the respondents does notenable a company, which has been merged with another companypursuant to an amalgamation order passed by a Court, to file itsincome tax returns manually. The petitioner having produced theerror report of the respondents will clearly establish that thehttps://hcservices.ecourts.gov.in/hcservices/ attempts made by the petitioner to submit the returns for M/s.OASDigital Infrastructure Private Limited, due to the fact that the e-portal system of the respondents does not enable the said report tobe filed electronically, was a genuine one. 11.Even though the learned Standing Counsel for the respondentsvehemently argued that the reasons for non filing of the returns bythe petitioner cannot be believed in view of the fact that thepetitioner had contended before the respondents through theircommunication that they need not file returns on behalf of M/s.OASDigital Infrastructure Private Limited, the same cannot be acceptedby this Court, as there is no conclusive proof to show that theattempts made by the petitioner to file the returns was not agenuine one. As observed earlier, the benefit of doubt must also begiven to the assessee. Therefore, this Court is of the consideredview that principles of natural justice has been violated by therespondents while passing the impugned assessment order, as noopportunity has been given to the petitioner to file their returnspursuant to the notice issued by the respondents under Section 148of the Income Tax Act, 1961, for reopening of assessment. 12.For the foregoing reasons, the impugned assessment order,dated 31.12.2019 passed by the second respondent against thepetitioner for the assessment year 2012-13 is hereby quashed and thematter is remanded back to the second respondent for freshconsideration and the second respondent shall pass final assessmentorders after permitting the petitioner to file the returns underSection 147 of the Income Tax Act, 1961, on merits and in accordancewith law after giving adequate opportunity to the petitionerincluding granting them the right of personal hearing within aperiod of four weeks from the date of receipt of a copy of thisorder. The petitioner is directed to file their return manuallywithin a period of two weeks from the date of receipt of a copy ofthis order. 13.With the above directions, this Writ Petition is disposedof. No costs. Consequently, connected miscellaneous petitions areclosed. // True Copy // Sd/-Assistant Registrar (Crl Side) cmr / /2020Sub Assistant Registrar(CS) https://hcservices.ecourts.gov.in/hcservices/ To 1.The Income Tax Officer, Ward 3(2), 4[th] Floor, Main Building, Williams Road, Contonment, Thiruchirapalli-620 015. Ward 3(2), 4[th] Floor, Main Building, Williams Road, Contonment, Thiruchirapalli-620 015. 2.The Income Tax Officer, Ward 1(2), 4[th] Floor, Williams Road, Contonment, Thiruchirapalli-620 015. Ward 1(2), 4[th] Floor, Williams Road, Contonment, Thiruchirapalli-620 015. +1 CC to M/s.ARUN KARTHICK MOHAN, Advocate ( SR-23790[F] dated03/12/2020 )03/12/2020 ) +1 CC to M/s.N.DHILIP KUMAR, Advocate ( SR-23831[F] dated 03/12/2020 Order made inW.P.(MD)No.2897 of 202002.12.2020 MR(CO)KK(10.12.2020) 5 P 5C