Wp/3800/2018 Of Mr Sawarmal Agarwal v. The Deputy Commissioner Of Income Tax

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26 DAY OF NOVEMBER, 2019. BEFORE, THR HON’BLE MRS.JUSTICEK S.SUJATHA WRIT PETITION No.3800/2018 (TIT) BETWEEN : Mr. SAWARMAL AGARWALS/O LATE FAKIRCHAND AGARWALAGED ABOUT 64 YBARS|R/AT No.28, 4[‘T]CROSS,|LALBAGH ROAD, K.S.GARDENBANGALORE-560002 .. PETITTIONER (BY SRI PRADEEP KUMAR J., ADV. FOR SRI HARISH V.8S., ADV.) AND : THER DEPUTY COMMISSIONER OF INCOME TAXCIRCLE-7(2)(1), ROOM NO.318,, FLOOR, BMTC BUILDING,80 FEET ROAD, 6[‘T]BLOCK|KORAMANGALA, BANGALORE-o60090 .. RESPONDENT. (BY SRI K.V.ARAVIND, ADV.) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND22/7 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THEIMPUGNED|ASSESSMENTORDERPASSED|BY|THERESPONDENT UNDER SECTION 143(3) OF THE INCOME TAX,ACT, 1961, DATED 29.12.2017 FOR THE ASSESSMENT YEAR|2015-2016 1.e., ANNEXURE-C AND CONSEQUENTIAL NOTICE OFDEMAND ISSUBD BY THR RESPONDENT UNDER SBCTION 156)OF THE INCOME TAX ACT, 1961, DATED 29.12.2017 FOR THEASSESSMENT YEAR 2015-2016 1.e., ANNEXURE-C1. THIS PETITION COMING ON FOR PRELIMINARY HEARING|IN ‘B’ GROUPZTHIS DAY, THE COURT MADE THE FOLLOWING: -9.- ORDER The petitioner has assailed the assessment orderpassed by the respondent under Section 143(3) of theIncome Tax Act, 1961 (‘Act’ for short) relating to theassessment year 2019-16 and consequential notice ofdemand issued by the respondent under Section 156 ofthe Act. 2.Thepetitioner1S|allindividual.It|1S|submitted that during the relevant assessment year thepetitioner has sold equity shares of M/s PS(IT) Infra andservices Limited, had earned long term capital gain,accordingly claimed exemption under Section 10(38) ofthe Act. The relevant investments were made by thepetitioner way back in the year 2012 which were theshares in the DRBMAT form. The said shares were sold|by the petitioner in the stock exchange. The saleproceeds were received by the petitioner though bankingchannel. It is submitted that the Income Tax'§ Department selected the cases of all those individualsacross the Country who had claimed exemption undersection 10(38) of the Act. The petitioner’s case was alsoselected for scrutiny. Pursuant to the show causenotice issued, the petitioner has furnished all thedocuments /informationthat|WeTesoughtbythe.respondent in addition to demonstrating that theallegation of the respondent was contrary to thepetitioner’s case. 3.It is the contention of the petitioner that therespondent has hastily and arbitrarily concluded theassessment in violation of the principles of naturaljustice by failing to furnish the copy of the investigationreport, sworn statements that were relied upon by therespondent. Hence, the present writ petition. 4.Learned counsel for the Revenue would|submit that the background of investigation referred bythe Assessing Officer was only to tacilitate the -4- assessment proceedings. Marshalling of facts for betterunderstanding of the case would not be considered asthe reliance made by the Assessing Officer to arrive at aconclusion. Indeed, all the relevant materials weremadeavailableTOtheasSsSE€SSandadequateopportunityWaSprovided|TO putiorthhisreply/objections with all materials. After consideringthe same, the order impugned has been passed. Thepetitionerhasantefficacious,alternativeremedyavailable under the Act. However, circumventing thesame, the present writ petition is filed. 5.Having heard the learned counsel for theparties and perusing the material on record, this Courtis of the considered view that it would be appropriate torelegate the petitioner to file an alternative andefficacious statutory remedy of appeal available underthe Act since the disputed questions of facts and law |involved herein cannot be adjudicated in the writ -5- proceedings.|Indeed,reasonableopportunityWaSprovided to the petitioner to puttforth his case. If thepetitioner is aggrieved by the decision of the AssessingOfficer, hierarchy of authorities provided under the Act.are required to adjudicate upon the said issue. 5.Having heard the learned counsel for theparties and perusing the material on record, this Courtis of the considered view that it would be appropriate torelegate the petitioner to file an alternative andefficacious statutory remedy of appeal available underthe Act since the disputed questions of facts and law |involved herein cannot be adjudicated in the writ -5- proceedings.|Indeed,reasonableopportunityWaSprovided to the petitioner to puttforth his case. If thepetitioner is aggrieved by the decision of the AssessingOfficer, hierarchy of authorities provided under the Act.are required to adjudicate upon the said issue. 6.Without expressing any opinion on themerits or demerits of the case, the petitioner is relegatedto file the alternative remedy of appeal under the Act. Itsuch an appeal is preferred within a period of two weeks—from the date of receipt of certified copy of the order, thesame shall be considered by the Appellate Authority onmerits without objecting to the aspect of limitation. Allrights and contentions of the parties are leit open. TheAppellateAuthorityshall|decide|thematter|in.accordance with law in an expedite manner. Writ petition stands disposed of, in terms of the. above. Dvr: Sd/-.JUDGE.