Wp/23757/2021 Of Mr Ramesh Thyagarajan v. The Additional/Joint/Deputy/Assistant Commissioner Of Income Tax/Income -Tax Officer

IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 2 DAY OF SEPTEMBER, 2022 BEFORE THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR -WRIT PETITION No.23757 OF 2021 (TIT) BETWEEN: MR. RAMESH THYAGARAJAN SON OF M.K. THYAGAR AGED 47 YEARS, #9A, JAYA DEVI NIVAS, MUNESHWARA TEMPLE STREET, LOTTEGOLLAHALLI, RMV II STAGE, BENGALURU-560094. (BY MS. BHAVANA B., ADVOCATE FOR SRI. SANDEEP HULIGOL, ADVOCATE) …PETITIONER AND: 1. THE ADDITIONAL/JOINT/DEPUTY/ ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME-TAX OFFICER, NATIONAL E-ASSESSMENT CENTRE (NOW CALLED NATIONAL FACELESS ASSESSMENT CENTRE), DELHI, INCOME-TAX DEPARTMENT, 2 FLOOR, JAWAHARLAL NEHRU STADIUM, NEW DELHI-110 003. 2. INCOME TAX OFFICER, WARD 2(2)(7), BANGALORE, BMTC BUILDING, 80 FEET ROAD, 6 BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU-560 095. 3. THE PRINCIPAL COMMISSIONER/ COMMISSIONER OF INCOME TAX-2, BANGALORE, BMTC BUILDING 80 FEET ROAD, 6 BLOCK, KORAMANGALA, BENGALURU-560 095. (BY SRI E.I. SANMATHI, ADVOCATE) …RESPONDENTS THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ASSESSMENT ORDER DATED 23.02.2021 PASSED BY THE R1 U/S. 143(3) R/W SECTION 143(3A) AND 143(3B) OF THE INCOME TAX ACT, 1961 FOR ASSESSMENT YEAR 2018-19 ANNEXURE-A1 AND ETC. THIS W.P. COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:- ORDER In this petition, the petitioner has sought for the following reliefs: (i) Stay the operation of the impugned assessment order dated 23.02.2021 bearing DIN No.ITBA/AST/S/143(3)/2020-21/1030910078(1) passed by the 1[st] Respondent under Section 143(3) read with Section 143(3A) and 143(3B) of the Income Tax Act, 1961, for assessment year 2018-19 (Annexure ‘A-1’); (ii) Stay the operation of the impugned computation sheet dated 23.02.2021 bearing DIN and Document No.ITBA/AST/S/183/2020-21/10309 10152(1) issued by the 1[st] Respondent under the provisions of the Income Tax Act, 1961, for the assessment year 2018-19 (Annexure-‘A2’); (iii) Stay the operation of the impugned notice of demand dated 23.02.2021 bearing DIN and Notice No.ITBA/AST/S/156/2020-21/10309101 18 (1) issued by the 1[st] Respondent under demand dated 23.02.2021 bearing DIN and Notice No.ITBA/AST/S/156/2020-21/10309101 18 (1) issued by the 1[st] Respondent under (iv) (v) (vi) (vii) Section 156 of the Income Tax Act, 1961, for the assessment year 2018-19 (Annexure-‘A3’). Quashing the impugned penalty order dated 12.11.2021 bearing DIN No.ITBA/PNL/F/270A/2021-22/1036903456 (1) passed by the 1[st] Respondent under Section 270A of the Income Tax Act 1961, for the assessment year 2018-19 (Annexure-‘B1’) Quashing the impugned penalty computation sheet dated 11.11.2021 bearing DIN No.ITBA/PNL/S/270A/2020-21/1030910192 (1) passed by the 1[st] Respondent under the provisions of the Income Tax Act 1961, for the assessment year 2018-19 (Annexure-A2); Quashing the impugned penalty demand notice dated 11.11.2021 bearing DIN No.ITBA/PNL/S/156/2021-22/1036902960(1) passed by the 1[st] Respondent under Section 156 of Income Tax Act 1961, for the assessment year 2018-19 (Annexure-B3); Pass such order or further orders as this Hon’ble Court may deem fit in the facts and circumstances of the case of the case, and in the interests of justice and equity. 2. Heard learned counsel for the petitioner, learned counsel for the respondents and perused the material on record. Quashing the impugned penalty computation sheet dated 11.11.2021 bearing DIN No.ITBA/PNL/S/270A/2020-21/1030910192 (1) passed by the 1[st] Respondent under the provisions of the Income Tax Act 1961, for the assessment year 2018-19 (Annexure-A2); Quashing the impugned penalty demand notice dated 11.11.2021 bearing DIN No.ITBA/PNL/S/156/2021-22/1036902960(1) passed by the 1[st] Respondent under Section 156 of Income Tax Act 1961, for the assessment year 2018-19 (Annexure-B3); Pass such order or further orders as this Hon’ble Court may deem fit in the facts and circumstances of the case of the case, and in the interests of justice and equity. 2. Heard learned counsel for the petitioner, learned counsel for the respondents and perused the material on record. 3. In addition to reiterating the various contentions urged in the Memorandum of Petition and referring to the documents produced by the petitioner, learned counsel for the petitioner submits that pursuant to the show-cause notice dated 18.09.2020 issued by respondent No.1 enclosing approved assessment order, the petitioner submitted his response requesting for an opportunity of hearing through video conferencing. Instead of considering the request made by the petitioner, respondent No.1 proceeded to issue notice dated 10.10.2020 under Section 142(1) of the Income Tax Act, 1961 (for short “the Income Tax Act”), to which the petitioner submitted a reply reiterating the request and also prayed for ten days time to file detailed submissions. It is the grievance of the petitioner that despite the aforesaid facts and circumstances, the request for personal hearing submitted by the petitioner was not acceded to by the respondents without assigning any reasons and respondent No.1 has proceeded to pass the impugned order, which deserves to be quashed on this ground alone. Learned counsel for the petitioner also submits that though several documents had been produced by the petitioner on 19.05.2022 and 17.07.2022 prior to passing the impugned order, respondent No.1 has neither considered nor appreciated the said documents and hence, the impugned order deserves to be quashed on this ground also. 4. Per contra, learned counsel appearing 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 material on record will indicate that pursuant to issuance of show-cause notice dated 18-09.2020 enclosing the draft assessment order, petitioner requested for an opportunity of personal hearing and reiterated the same, despite which respondent No.1 has proceeded to pass the impugned order, which is clearly violative of principles of natural justice. It is also relevant to state that despite the petitioner submitting documents, details etc., on 19.05.2022 and 17.07.2022, the same having not been considered or appreciated by respondent No.1 while passing the impugned order is vitiated on this ground also. Under these circumstances, I deem it just and appropriate to set aside the impugned assessment order at Annexure-A1 as well as all consequential notices and remit the matter back to respondent No.1 for reconsideration afresh in accordance with law. 6. In the result, I pass the following: ORDER (i) The petition is hereby allowed. (ii) The impugned assessment order dated 23.02.2021, computation sheet dated 23.02.2021, notice of demand dated 23.02.2021, penalty order dated 12.11.2021, penalty computation dated 11.11.2021 and demand notice dated 11.11.2021 passed by respondent No.1 vide Annexures-A1, A2, A3, 23.02.2021, computation sheet dated 23.02.2021, notice of demand dated 23.02.2021, penalty order dated 12.11.2021, penalty computation dated 11.11.2021 and demand notice dated 11.11.2021 passed by respondent No.1 vide Annexures-A1, A2, A3, B1, B2 and B3 respectively are hereby quashed. 6. In the result, I pass the following: ORDER (i) The petition is hereby allowed. (ii) The impugned assessment order dated 23.02.2021, computation sheet dated 23.02.2021, notice of demand dated 23.02.2021, penalty order dated 12.11.2021, penalty computation dated 11.11.2021 and demand notice dated 11.11.2021 passed by respondent No.1 vide Annexures-A1, A2, A3, 23.02.2021, computation sheet dated 23.02.2021, notice of demand dated 23.02.2021, penalty order dated 12.11.2021, penalty computation dated 11.11.2021 and demand notice dated 11.11.2021 passed by respondent No.1 vide Annexures-A1, A2, A3, B1, B2 and B3 respectively are hereby quashed. (iii) The matter is remitted back to respondent No.1 for reconsideration afresh in accordance with law after providing sufficient and reasonable opportunity to the petitioner. (iv) Respondent No.1 is also directed to give an opportunity of personal hearing to the petitioner and proceed thereafter in accordance with law. opportunity of personal hearing to the petitioner and proceed thereafter in accordance with law. Sd/- JUDGE Bmc