Suresh Prasad Sah Son Of Shyam Lal Sah Resident Of Village- Phulhara Bazar,P.o.- Bidupur, P.s.- Raja Pakar, District- Vaishali At Hajipur v. The Union Of India Department Of Income Tax

IN THE HIGH COURT OF JUDICATURE AT PATNACivil Writ Jurisdiction Case No.9362 of 2021 ====================================================== Suresh Prasad Sah son of Shyam Lal Sah resident of Village- Phulhara Bazar,P.O.- Bidupur, P.S.- Raja Pakar, District- Vaishali at Hajipur- 844502. ... ... Petitioner/s Versus 1.The Union of India Department of Income Tax through the Commissioner ofIncome Tax, Revenue Building, Birchandra Patel Path, Patna (Bihar).Income Tax, Revenue Building, Birchandra Patel Path, Patna (Bihar). 2.The Commissioner of Income Tax, Revenue Building, Birchandra PatelPath, Patna (Bihar).Path, Patna (Bihar). 3.The Income Tax Officer, Ward Circle- 1(3) Vaishali, Dighi Kalan, Vaishali atHajipur (Bihar)- 844101.Hajipur (Bihar)- 844101. ... ... Respondent/s ======================================================Appearance :For the Petitioner/s: Mr.Nitesh Kumar, Advocate Mr. Lakshmi Kant Tiwary, Advocate For the Respondent/s: Mr.Dr.K.N.Singh (ASG) Mrs. Archana Sinha, Advocate ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE S. KUMAR ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE) (The proceedings of the Court are being conducted by Hon’ble the ChiefJustice/Hon’ble Judges through Video Conferencing from theirresidential offices/residences. Also the Advocates and the Staffs joined theproceedings through Video Conferencing from their residences/offices.) Date : 29-07-2021 Petitioner has prayed for the following relief(s): “For issuance of: (i) MANDAMUS for direction of respondent no-3to treat the petitioner as not being in default inrespect of the amount in dispute in the appealwhich is sub-judice in the appellate courtagainst the assessment order under section 144 of the Income tax Act 1961 dated 05.12.2019(Annexure-- 1) has passed by him and by whichhe has assessed the income of the petitioner forAssessment Year 2016-2017 amounting to Rs.12,70,100.00 (Twelve Lakh Seventy ThousandOne Hundred Rupees) as unexplained moneyunder section 69A of the Income Tax Act 1961and raised huge demand of Rs. 15,89,434.00(Fifteen Lakhs Eighty Nine Thousand FourHundred Thirty Four Rupees) and recoveredfrom the bank account of the petitioneramounting to Rs. 79,404.00 (Seventy NineThousand Four Hundred Four Rupees) againstthe aforesaid demand. Hence the rest amountshould be stayed till disposal of the appeal; (ii) Granting any other relief/relieves to which thepetitioner may be found entitled to.”petitioner may be found entitled to.” It is brought to our notice that vide impugned order dated 5[th] of December, 2019 passed by the Respondent No. 3namely the Income Tax Officer, Ward Circle- 9(3) Vaishali theincome of the petitioner has been assessed for Assessment Year2016-2017 amounting to Rs.12,70,100.00 and a demand ofRs.15,89,434.00 has been raised and an amount of Rs.79,404.00 hasbeen recovered against the aforesaid demand. Learned counsel for the Income Tax, states that he hasno objection if the matter is remanded to the Appellate Authorityfor deciding the case afresh. Also, the case shall be decided on merits. Also, during pendency of the case, no coercive steps shall betaken against the petitioner. Statement accepted and taken on record. It is brought to our notice that vide impugned order dated 5[th] of December, 2019 passed by the Respondent No. 3namely the Income Tax Officer, Ward Circle- 9(3) Vaishali theincome of the petitioner has been assessed for Assessment Year2016-2017 amounting to Rs.12,70,100.00 and a demand ofRs.15,89,434.00 has been raised and an amount of Rs.79,404.00 hasbeen recovered against the aforesaid demand. Learned counsel for the Income Tax, states that he hasno objection if the matter is remanded to the Appellate Authorityfor deciding the case afresh. Also, the case shall be decided on merits. Also, during pendency of the case, no coercive steps shall betaken against the petitioner. Statement accepted and taken on record. However, having heard learned counsel for the partiesas also perused the record made available, we are of theconsidered view that this Court, notwithstanding the statutoryremedy, is not precluded from interfering where, ex facie, weform an opinion that the order is bad in law. This we say so,for two reasons- (a) violation of principles of natural justice,i.e. Fair opportunity of hearing. No sufficient time wasafforded to the petitioner to represent his case; (b) order passedex parte in nature, does not assign any sufficient reasons evendecipherable from the record, as to how the officer coulddetermine the amount due and payable by the assessee. Theorder, ex parte in nature, passed in violation of the principlesof natural justice, entails civil consequences. As such, on thisshort ground alone, we dispose of the present writ petition inthe following mutually agreeable terms: (a) We quash and set aside the impugned order dated5[th] of December, 2019 passed by the Respondent No. 3 namelythe Income Tax Officer, Ward Circle- 9(3) Vaishali; (b) We accept the statement of the petitioner that ten per cent of the total amount, being condition prerequisite forhearing of the appeal, already stands deposited. If that were so,well and good. However, if the amount is not deposited forwhatever reason(s), same shall be done before the next date; (c) Petitioner undertakes to deposit additional sumof Rs. 1,00,000/- (one lac) with the Appellate Authority.The petitioner undertakes to deposit the amount within oneweek from today whereafter the appeal shall be decidedwithin two months. (d) With such deposit, we direct the AppellateAuthority i.e. Commissioner, Appeal, Income Tax, todecide the petitioner’s appeal on merits. While passing suchorder, we have taken notice of both the Circlular issued bythe Department as also the order passed by Hon’bleSupreme Court in Civil Appeal No.6850 of 2018, titled asPrincipal Commissioner of Income Tax Vs. L.G.Electronics of India Pvt. Ltd. clarifying the same. (e) This deposit shall be without prejudice to therespective rights and contention of the parties and subject tothe order passed by the Appellate Authority. However, if itis ultimately found that the petitioner’s deposit is in excess,the same shall be refunded within two months from the date of passing of the order; (f) We also direct for de-freezing/de-attaching ofthe bank account(s) of the writ-petitioner, if attached inreference to the proceedings, subject matter of presentpetition. This shall be done immediately. (g) Petitioner undertakes to appear before theAppellate Authority on 9[th] of August, 2021 at 10:30 A.M.,if possible through digital mode; (h) The Appellate Authority shall condone the delay in filing the appeal and decide the appeal onmerits after complying with the principles of naturaljustice; (i) Opportunity of hearing shall be afforded tothe parties to place on record all essential documentsand materials, if so required and desired; (j) During pendency of the appeal, no coercive steps shall be taken against the petitioner. (k) The Appellate Authority shall pass a freshorder only after affording adequate opportunity to allconcerned, including the writ petitioner; (l) Petitioner through learned counsel undertakes to (g) Petitioner undertakes to appear before theAppellate Authority on 9[th] of August, 2021 at 10:30 A.M.,if possible through digital mode; (h) The Appellate Authority shall condone the delay in filing the appeal and decide the appeal onmerits after complying with the principles of naturaljustice; (i) Opportunity of hearing shall be afforded tothe parties to place on record all essential documentsand materials, if so required and desired; (j) During pendency of the appeal, no coercive steps shall be taken against the petitioner. (k) The Appellate Authority shall pass a freshorder only after affording adequate opportunity to allconcerned, including the writ petitioner; (l) Petitioner through learned counsel undertakes to fully cooperate in such proceedings and not takeunnecessary adjournment; (m) The Appellate Authority shall decide the appealon merits expeditiously, preferably within a period of twomonths from the date of appearance of the petitioner; (n) Liberty reserved to the petitioner to challengethe order, if required and desired; (o) Equally, liberty reserved to the parties to takerecourse to such other remedies as are otherwise availablein accordance with law; (p) We are hopeful that as and when petitionertakes recourse to such remedies, before the appropriateforum, the same shall be dealt with, in accordance withlaw, with a reasonable dispatch; (q) We have not expressed any opinion on meritsand all issues are left open; (r) If possible, proceedings during the time ofcurrent Pandemic [Covid-19] be conducted throughdigital mode; The instant petition sands disposed of in the aforesaid terms. Interlocutory Application(s), if any, also stands disposed of. Learned counsel for the respondents undertakes tocommunicate the order to the appropriate authoritythrough electronic mode. (Sanjay Karol, CJ) ( S. Kumar, J) K.C.Jha/- AFR/NAFRCAV DATEUploading Date04.08.2021Transmission Date