Wp/17418/2022 Of Sri Narayanan Kollakkil Kutty v. The Principal Commissioner Of Income Tax

IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 9 DAY OF SEPTEMBER, 2022 BEFORE THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR -WRIT PETITION No.17418 OF 2022 (TIT) BETWEEN: SRI NARAYANAN KOLLAKKIL KUTTY S/O SRI MADHAVAN NAIR AGED ABOUT 64 YEARS NO.24/25, BYRAVESHWARA INDUSTRIAL ESTATE ANDRAHALLI MAIN ROAD VISWANEEDAM POST PEENYA 2 STAGE BENGALURU-560091 (BY MISS. JINITA CHATTERJEE FOR SRI. PARTHASARATHI, ADVOCATES) …PETITIONER AND: 1 . THE PRINCIPAL COMMISSIONER OF INCOME TAX, BENGALURU-1, BMTC BUILDING, 80 FEET ROAD 6 BLOCK, NEAR KHB GAMES VILLAGE KORAMANGALA BENGALURU-560 095. 2 . THE INCOME TAX OFFICER, WARD-6(2)(1) ROOM NO.310, 3 FLOOR BMTC COMMERCIAL COMPLEX 80 FEET ROAD, KORAMANGALA BENGALURU-560 095. …RESPONDENTS (BY SRI. DILIP FOR SRI. K.V. ARAVIND, ADVOCATES) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER OF THE R1 DTD 31.05.2022 PASSED U/S 119(2)(b) OF THE ACT FOR THE ASSESSMENT YEAR 2019-20 IN FILE F.NO.711/119(2)(b)/PCIT-1/BLR/2020-21 ANNEXURE-G AND ETC. THIS W.P. COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:- ORDER In this petition, petitioner has sought for the following reliefs: a. Issue a writ of certiorari or a direction in the nature of writ of certiorari, quashing the order of the 1[st] respondent dated 31.05.2022 passed under Section 119(2)(b) of the Act for the assessment year 2019-20 in file F.No.711/ 119(2)(b)/PCIT-1/Blr/2020-21 (Annexure-G); b. Issue a writ of mandamus or a direction in the nature of writ of mandamus, directing the 1[st]respondent to entertain the application dated 16.04.2021 u/s 119(2)(b) of the Act for AY 2019-20 and to condone the delay in filing the return of income for the said assessment year along with Audit Report u/s 44AB of the Act (Annexure-D); c. Issue a writ of mandamus or a direction in the nature of writ of mandamus to direct 1[st]respondent to give instructions to the 2[nd]respondent to rectify the defective return once the delay is condoned and to refund the amount of Rs.2,07,210/- due to the petitioner in pursuance of the order of the 1[st] respondent dated 31.05.2022 passed under Section 119(2)(b) of the Act for the assessment year 2019-20 in file F.No.711 / 119(2)(b) / PCIT-1 / Blr / 2020-21 (Annexure-G); d. Pass such other order, direction or writ as this Hon’ble Court deems fit; and Hon’ble Court deems fit; and e. Direct the respondents to award the costs of this writ petition. writ petition. 2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3. The material on record discloses that during November 2019, the respondents issued a notice to the petitioner intimating him that the return was defective and called upon him to rectify the defects. In this context, the petitioner contends that due to health reasons and non-availability of his auditor, the petitioner could not comply with the demands made in the said notice and within the stipulated period and subsequently, on 16.04.2021, the petitioner submitted a representation giving all the clarifications as sought for by the respondents. Subsequently, the petitioner also made an application seeking condonation of delay and in response to the same, the respondents issued a letter / communication dated 22.12.2021, to which the petitioner submitted his response 3. The material on record discloses that during November 2019, the respondents issued a notice to the petitioner intimating him that the return was defective and called upon him to rectify the defects. In this context, the petitioner contends that due to health reasons and non-availability of his auditor, the petitioner could not comply with the demands made in the said notice and within the stipulated period and subsequently, on 16.04.2021, the petitioner submitted a representation giving all the clarifications as sought for by the respondents. Subsequently, the petitioner also made an application seeking condonation of delay and in response to the same, the respondents issued a letter / communication dated 22.12.2021, to which the petitioner submitted his response on 01.02.2022. It is the grievance of the petitioner that despite the aforesaid facts and circumstances, the respondents have proceeded to reject the application for condonation of delay filed by the petitioner by incorrectly placing reliance upon the CBDT Circular No.9/2015 dated 09.06.2015 without appreciating that the said Circular does not prohibit / bar the respondents from condoning the delay. On the other hand, the said Circular infact permits the respondents to condone the delay as sought for by the petitioner. It is also submitted that the respondents have also come to the conclusion that the petitioner had not filed Audit Report in Form 3CB and in this context also, if the impugned order is set aside and matter is remitted back to the respondents, the petitioner would file Audit Report in Form 3CB before the respondents, who is to be directed to reconsider the claim of the petitioner afresh in accordance with law. 4. Per contra, learned counsel for the respondents submits that there is no merit in the petition and the same is liable to be dismissed. 5. As rightly contended by the learned counsel for the petitioner, a perusal of the CBDT Circular No.9/2015 dated 09.06.2015 will clearly indicate that the respondents was empowered / authorized to condone the delay in terms of the said Circular. 6. Under these circumstances, I am of the considered opinion that the respondents clearly fell in error in rejecting the application for condonation of delay without appreciating that the said CBDT Circular dated 09.06.2015 could not have been made the basis by the respondents to reject the application for condonation of delay and consequently, the impugned order passed by the respondents deserves to be quashed on this ground alone. 7. Insofar as the finding recorded by the respondents that the petitioner had not filed its Audit Report in Form 3CB, in view of the specific submission made by the learned counsel for the petitioner that the petitioner would submit the said Audit Report in Form 3CB in the event one more opportunity is granted to him, I deem it just and appropriate to set aside the impugned order and remit the matter back to the respondents for reconsideration afresh in accordance with law. 8. In the result, I pass the following: ORDER (i) Petition is hereby allowed. (ii) The impugned order at Annexure – G dated 01.06.2022 is hereby set aside. dated 01.06.2022 is hereby set aside. (iii) The application for condonation of delay filed by the petitioner hereby stands allowed and the delay stands condoned. delay filed by the petitioner hereby stands allowed and the delay stands condoned. (iv) Respondents are directed to reconsider the claim of the petitioner without reference to the issue of limitation, which stands concluded in favour of the petitioner by virtue of this order. reconsider the claim of the petitioner without reference to the issue of limitation, which stands concluded in favour of the petitioner by virtue of this order. SV (v) Petitioner is directed to submit / furnish Audit Report in Form 3CB as well as additional documents and pleadings to the respondents, who shall proceed further and reconsider the claim of the petitioner afresh and pass appropriate orders in accordance with law. Sd/- (iv) Respondents are directed to reconsider the claim of the petitioner without reference to the issue of limitation, which stands concluded in favour of the petitioner by virtue of this order. reconsider the claim of the petitioner without reference to the issue of limitation, which stands concluded in favour of the petitioner by virtue of this order. SV (v) Petitioner is directed to submit / furnish Audit Report in Form 3CB as well as additional documents and pleadings to the respondents, who shall proceed further and reconsider the claim of the petitioner afresh and pass appropriate orders in accordance with law. Sd/- JUDGE