Wp/13324/2023 Of Mr. Gutharamamohanarao Krishnakishor v. Principal Commissioner Of Income Tax

Digitally signedby SUCHITRA M JLocation: HighCourt ofKarnataka IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 19 DAY OF JULY, 2023 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV -WRIT PETITION NO. 13324 OF 2023 (TIT) BETWEEN: MR. GUTHARAMAMOHANARAO KRISHNAKISHOR, SON OF MR. GUTHARAMA MOHANARAO, AGED ABOUT 56 YEARS, RESIDING AT NO.642, HARAGADDE, JIGANI, ANEKAL TALUK, BENGALURU RURAL - 560 105. …PETITIONER (BY SRI. SYED KHAMRUDDIN, ADVOCATE) AND: 1. PRINCIPAL COMMISSIONER OF INCOME TAX, BMTC BUILDING, 80 FEET ROAD, 6 BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU - 560 095. BMTC BUILDING, 80 FEET ROAD, 6 BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU - 560 095. 2. THE INCOME TAX OFFICER, WARD 4(3)(3) BANGALORE, BMTC BUILDING, 80 FEET ROAD, 6 BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU - 560 095. WARD 4(3)(3) BANGALORE, BMTC BUILDING, 80 FEET ROAD, 6 BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU - 560 095. …RESPONDENTS (BY SRI. SUSHAL TIWARI, ADVOCATE) THIS WP IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, 1950 PRAYING TO QUASH THE IMPUGNED ASSESSMENT ORDER BEARING NO. ITBA/AST/S/143(3)/2019-20/1021953269(1) DATED: 09/12/2019 (ANNEXURE-A) PASSED BY THE R-2 AND CONSEQUENT NOTICE BEARING NO. ITBA/AST/S/156/2019-20/1021953748(1) DATED 09/12/2019 ISSUED BY THE R-2 FOR THE AY 2017-18 (ANNEXURE-A1) AND ETC. - 2 - THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER The petitioner has sought for setting aside of the assessment order at Annexure-A dated 09.12.2019 passed by respondent No.2 and the consequent notice of demand at Annexure-A1. The petitioner has also sought for setting aside of the order dated 08.03.2022 passed under Section 264 of the Income Tax Act, 1961 (for short 'the Act') at Annexure-B. 2. Learned counsel appearing for the petitioner would submit that the notice is issued preceding the assessment order and has been issued to a wrong email-ID communications were sent to the email-ID of the Consultant, who has not kept the petitioner intimated. Accordingly, it is submitted that the Authority while passing the assessment order has treated that the petitioner is disentitled for exemption under Section 10(37) of the Act and added Rs.40,00,000/- to the returned income for the year 2017-18. Learned counsel for the petitioner further submits that if an opportunity is granted, they would be in a position to substantiate that the addition of Rs.40,00,000/- is in fact agricultural income. It is further submitted that the findings by the Revisional Authority under Section 264 of the Act, are also required to be interfered with while taking a broader look at the matter and affording a fresh opportunity to the petitioner to substantiate his case in light of the benefit conferred by way of exemption under Section 10(37) of the Act. 3. Learned counsel appearing for the respondents would point out that the Revisional Authority has recorded correct findings and no case as such is made out for interference. But however, he submits that the aspect of the violation of the principles of natural justice is a matter left for a Court to be considered appropriately. 4. Noticing the contention of the petitioner and also that if he was to be given an opportunity, the assertion that he would be able to demonstrate that Rs.40,00,000/- added is additional income ought to have been left out and hence, entitled for exemption under Section 10(37) of the Act is a matter that is to be taken note of, and an opportunity may be granted for the petitioner to file his reply to the notice dated 08.11.2019 under Section 142(1) of the Act. 3. Learned counsel appearing for the respondents would point out that the Revisional Authority has recorded correct findings and no case as such is made out for interference. But however, he submits that the aspect of the violation of the principles of natural justice is a matter left for a Court to be considered appropriately. 4. Noticing the contention of the petitioner and also that if he was to be given an opportunity, the assertion that he would be able to demonstrate that Rs.40,00,000/- added is additional income ought to have been left out and hence, entitled for exemption under Section 10(37) of the Act is a matter that is to be taken note of, and an opportunity may be granted for the petitioner to file his reply to the notice dated 08.11.2019 under Section 142(1) of the Act. 5. It is noticed that the Bank Account of the petitioner SB A/c No.656902010004359 and Gold Loan A/c No.654/2282 at UNION BANK OF INDIA has been frozen (Annexure-J). In light of the petition being allowed, freezing of Bank Account as a consequential relief would stand lifted and accordingly, the Bank Authorities to take note of the same. Accordingly, Assessment Order at Annexure-A and order at Annexure-B are set aside, the petitioner to deposit 10% of the demand to demonstrate his bonafides, which is to be made within a period of four weeks from the date of defreezing of the Bank Account. Accordingly, petition is disposed off. All contentions are kept open. Sd/- JUDGE