Wp/23777/2024 Of Mr. Narayanasetty Srinivasa v. Assistant Commissioner Of Income Tax

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3 DAY OF SEPTEMBER, 2024 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR -WRIT PETITION NO. 23777 OF 2024 (TIT) BETWEEN: MR. NARAYANASETTY SRINIVASA SON OF LATE NARAYANA SETTY, AGED ABOUT 64 YEARS, RESIDING AT NO 296, 16 CROSS, SADASHIVANAGAR, BENGALURU – 560 080. (BY SRI.PRADYUMNA HEJIB, ADVOCATE) …PETITIONER AND: 1. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 6(2) (2), INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU - 560 095. CIRCLE 6(2) (2), INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU - 560 095. Digitally signed byLEELAVATHI S RLocation: HIGHCOURT OFKARNATAKA 2. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 6 (2) (1), INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, CIRCLE 6 (2) (1), INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU - 560 095. KORAMANGALA, BENGALURU - 560 095. 3. NATIONAL E-ASSESSMENT CENTRE INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO 401, 2 FLOOR, E - RAMP, JAWARHARLAL NEHRU STADIUM, DELHI – 110 003. REPRESENTED BY ITS ADDITIONAL / JOINT/ DEPUTY/ ASSISTANT COMMISSIONER OF INCOME TAX INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO 401, 2 FLOOR, E - RAMP, JAWARHARLAL NEHRU STADIUM, DELHI – 110 003. REPRESENTED BY ITS ADDITIONAL / JOINT/ DEPUTY/ ASSISTANT COMMISSIONER OF INCOME TAX 4. NATIONAL FACELESS ASSESSMENT CENTRE INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO 401, 2 FLOOR, E - RAMP, JAWARHARLAL NEHRU STADIUM, DELHI – 110 003. REPRESENTED BY ADDITIONAL / JOINT/ DEPUTY/ ASSISTANT COMMISSIONER OF INCOME TAX …RESPONDENTS (BY SRI.M. DILIP, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE IMPUGNED SHOW CAUSE NOTICE DATED 12.11.2019 BEARING NO. ITBA/AST/F/143(3) (SCN)/20/2019-20/1020244895(1) PASSED BY THE 2(ND) RESPONDENT (ANNEXURE A) AND QUASH THE IMPUGNED SHOW CAUSE NOTICE DATED 07.12.2019 BEARING NO. ITBA/AST/F/143(3) (SCN)/20/2019-20/1021886724(1) PASSED BY THE 2 RESPONDENT (ANNEXURE A1) AND ETC., THIS WRIT PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR ORAL ORDER In this petition, the petitioner seeks the following reliefs: i) Quash the impugned Show Cause Notice dated 12.11.2019 bearing No. ITBA/AST/F/143(3) (SCN)/20/2019-20/1020244895(1) passed by the 2[nd]Respondent (Annexure A); ii) Quash the impugned Show Cause Notice dated 07.12.2019 bearing No. ITBA/AST/F/143(3) (SCN)/20/2019-20/1021886724(1) passed by the 2[nd]Respondent (Annexure A1); iii) Quash the impugned Assessment Order bearing No.ITBA/AST/S/143(3)/2019-20/1023122595(1) dated 26.12.2019 passed by the 2[nd] Respondent (Annexure B); iv) Quash the impugned Notice of Demand passed by the 1[st] Respondent bearing No. ITBA/AST/S/156/2019- 20/1023122745(1) (Annexure B1) along with Computation Sheet bearing No. ITBA/AST/S/213/2019-20/1023122720(1), both dated 26.12.2019 passed by the 2[nd] Respondent (Annexure B2); v) Quash the impugned Notice for Penalty dated 26.12.2019 under Section 274 read with Section 270A of the Income Tax Act, 1961 bearing No. ITBA/PNL/S/270A/2019-20/1023122759(1) passed by the 2[nd] Respondent (Annexure C); vi. Quash the impugned Notice for Penalty dated 27.12.2019 under Section 274 read with Section 271AAC(1) of the Income Tax Act, 1961 bearing No. ITBA/PNL/S/271AAC(1)/2019-20/1023230965(1) passed by the 2[nd] Respondent (Annexure D) vii. Quash the impugned Show Cause Notice for Penalty dated 15.03.2021 under Section 270A of the Income Tax Act, 1961 bearing No. ITBA/PNL/F/270A/2020-21/1031494859(1) passed by the 3[rd]Respondent (Annexure E). v) Quash the impugned Notice for Penalty dated 26.12.2019 under Section 274 read with Section 270A of the Income Tax Act, 1961 bearing No. ITBA/PNL/S/270A/2019-20/1023122759(1) passed by the 2[nd] Respondent (Annexure C); vi. Quash the impugned Notice for Penalty dated 27.12.2019 under Section 274 read with Section 271AAC(1) of the Income Tax Act, 1961 bearing No. ITBA/PNL/S/271AAC(1)/2019-20/1023230965(1) passed by the 2[nd] Respondent (Annexure D) vii. Quash the impugned Show Cause Notice for Penalty dated 15.03.2021 under Section 270A of the Income Tax Act, 1961 bearing No. ITBA/PNL/F/270A/2020-21/1031494859(1) passed by the 3[rd]Respondent (Annexure E). viii. Quash the impugned Show Cause Notice for Penalty dated 15.03.2021 under Section 271AAC(1) of the Income Tax Act, 1961 bearing No. ITBA/PNL/F/271AAC(1)/2020-21/1031494887(1) passed by the 3[rd]Respondent (Annexure F). ix Quash the impugned Order under Section 270A of the Income Tax Act, 1961 dated 28.01.2022 bearing No. ITBA/PNL/F/270A/2021- 22/1039162856(1) passed by the 4[th] Respondent. (Annexure G) x. Quash the impugned Notice of Demand dated 28.01.2022 bearing No ITBA/PNL/S/156/2021-22/1039162437(1) Annexure H along with Computation Sheet bearing No. ITBA/PNL/S/157/2021-22/1038664104(1) both passed by the 4[th] Respondent. (Annexure H1). xi Quash the impugned Order under Section 271AAC (1) of the Income Tax Act, 1961 dated 04.02.2022 bearing No. ITBA/PNL/F/271AAC(1)/2021-22/1039385597(1) passed by the 4th Respondent. (Annexure J) xii. Quash the impugned Notice of Demand dated 03.02.2022 bearing No. ITBA/PNL/S/156/2021-22/1039383354(1) passed by the 4[th]Respondent (Annexure K). xiii. Pass such other or further order as this Hon’ble Court may deem fit in the facts and circumstances of the case, and in the interests of justice and equity.” 2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3. A perusal of the material on record will indicate that pursuant to exchange of notices and replies between the petitioner and the respondents, a show cause notice dated 07.12.2019 was issued to the petitioner, who submitted a reply dated 21.12.2019 - 5 - and sought for further time to submit additional reply and documents to the respondents. It is the grievance of the petitioner that despite making the aforesaid request in his reply dated 21.12.2019 and the subsequent, prevailing Covid-19 pandemic exigency, the respondents have proceeded to pass the impugned assessment order followed by the impugned notices, which are assailed in the present petition on the ground that there was violation of principles of natural justice, since sufficient and reasonable opportunity had not been granted/provided in favour of the petitioner, who is before this Court by way of the present petition. 4. Per contra learned counsel for the respondents submits that there is no merit in the writ petition and that the same is liable to be dismissed. 5. A perusal of the reply dated 21.12.2019 submitted by the petitioner will indicate that despite the specific request made by the petitioner seeking some more time to collate and submit additional reply along with relevant documents, the respondents have proceeded to pass the impugned assessment order at Annexure-B dated 26.12.2019 followed by consequential notices etc., without referring to the said reply dated 21.12.2019 and - 6 - NC: 2024:KHC:35750 WP No. 23777 of 2024 4. Per contra learned counsel for the respondents submits that there is no merit in the writ petition and that the same is liable to be dismissed. 5. A perusal of the reply dated 21.12.2019 submitted by the petitioner will indicate that despite the specific request made by the petitioner seeking some more time to collate and submit additional reply along with relevant documents, the respondents have proceeded to pass the impugned assessment order at Annexure-B dated 26.12.2019 followed by consequential notices etc., without referring to the said reply dated 21.12.2019 and - 6 - NC: 2024:KHC:35750 WP No. 23777 of 2024 without providing sufficient or reasonable opportunity to the petitioner in this regard, thereby violating principles of natural justice coupled with the prevailing Covid-19 pandemic exigency. Under these circumstances, by adopting a justice oriented approach and in order to provide one more opportunity to the petitioner to submit his replies/additional replies along with documents to the show-cause notices dated 12.11.2019 and 07.12.2019, I deem it just and appropriate to set aside the impugned order at Annexure-B dated 26.12.2019 and consequential notices etc., and remit the matter back to the respondents for reconsideration afresh in accordance with law. ORDER [a] The petition is hereby allowed. [b] The impugned order at Annexure-B dated 26.12.2019 as well as the impugned notices at Annexures-B1, B2 as well as the impugned notices at Annexures-B1, B2 and C, all dated 26.12.2019, the impugned notice at Annexure-D dated 27.12.2019, impugned notice at Annexure-E dated 15.03.2021, impugned notice at Annexure-F dated 15.03.2021, impugned order at Annexure-G dated 28.01.2022, impugned notice and computation sheet at Annexures-H and H1 both Annexure-D dated 27.12.2019, impugned notice at Annexure-E dated 15.03.2021, impugned notice at Annexure-F dated 15.03.2021, impugned order at Annexure-G dated 28.01.2022, impugned notice and computation sheet at Annexures-H and H1 both dated 28.01.2022, impugned order at Annexure-J dated 04.02.2022 and impugned notice at Annexure- K dated 03.02.2022, are all hereby set aside. [c] The matter is remitted back to the concerned respondent for reconsideration afresh to the stage of the petitioner submitting his replies/additional replies along with documents to the show-cause notices dated 12.11.2019 and 07.12.2019, in accordance with law. respondent for reconsideration afresh to the stage of the petitioner submitting his replies/additional replies along with documents to the show-cause notices dated 12.11.2019 and 07.12.2019, in accordance with law. [d] Liberty is reserved in favour of the petitioner to submit his response/reply along with the documents before the concerned respondents, who shall consider the same and provide sufficient and reasonable opportunity to the petitioner and hear him and proceed further in accordance with law. his response/reply along with the documents before the concerned respondents, who shall consider the same and provide sufficient and reasonable opportunity to the petitioner and hear him and proceed further in accordance with law. Sd/- (S.R.KRISHNA KUMAR) JUDGE