Wp(C) v. Asst. Commissioner Of Income Tax[2016 (4) Klt 350

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN THURSDAY, THE 16TH DAY OF FEBRUARY 2017/27TH MAGHA, 1938 WP(C).No. 1702 of 2017 (K) --------------------------- PETITIONER : ---------------------- UNITAC ENERGY SOLUTIONS INDIA PVT. LTD., 32/8-B4/1, 2ND FLOOR, SURYA GAYATRI, N.H.BYPASS, PUTHIYAROAD, NEW JUNCTION, KOCHI-682 032. BY ADV. SMT.NISHA JOHN RESPONDENT(S): ---------------------------- 1. ASSISTANT COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 2(1), KOCHI, 3RD FLOOR, CENTRAL REVENUE BUILDING, I.S. PRESS ROAD, KOCHI-682 018. CORPORATE CIRCLE 2(1), KOCHI, 3RD FLOOR, CENTRAL REVENUE BUILDING, I.S. PRESS ROAD, KOCHI-682 018. 2. PRINCIPAL COMMISSIONER OF INCOME TAX, KOCHI, CENTRAL REVENUE BUILDING, I.S. PRESS ROAD, KOCHI-682 018. KOCHI, CENTRAL REVENUE BUILDING, I.S. PRESS ROAD, KOCHI-682 018. R1 & R2 BY SR STANDING COUNSEL SRI.P.K.R.MENON SRI.JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 16-02-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No. 1702 of 2017 (K) ---------------------------------------- APPENDIX PETITIONER(S)' EXHIBITS --------------------------------------- EXHIBIT P1: TRUE COPY OF NOTICE DATED 3.9.2015 ISSUED U/S. 143 (2) OF INCOME TAX ACT BY THE IST RESPONDENT.INCOME TAX ACT BY THE IST RESPONDENT. EXHIBIT P2: TRUE COPY OF THE NOTICE DATED 27.7.2016 U/S.142 (1) AND SERVED ON THE ASSESSE ON 23.8.2016.ON THE ASSESSE ON 23.8.2016. EXHIBIT P3: TRUE COPY OF THE NOTICE DATED 15.12.2016 ISSUED BY THE IST RESPONDENT.RESPONDENT. EXHIBIT P4: TRUE COPY OF THE DEMAND NOTICE ALONG WITH THE ASSESSMENTORDER AND NOTICE W/S. 274 R/W S.271 OF THE INCOME TAX ACT.ORDER AND NOTICE W/S. 274 R/W S.271 OF THE INCOME TAX ACT. EXHIBIT P5:TRUE COPY OF THE ACKNOWLEDGEMENT OF RECEIPT ISSUED BY RESPONDENT DATED 09/09/2016.RESPONDENT DATED 09/09/2016. RESPONDENT(S)' EXHIBITS ------------------------------------------ EXHIBIT R1(A): TRUE COPY OF THE SCREENSHOT TAKEN FROM THE ITD APPLICATION EVIDENCING THAT THE TYPE OF SCRUTINY IS 'COMPLETE', WHICH HAS BEEN GENERATED THROUGH THE SYSTEM. APPLICATION EVIDENCING THAT THE TYPE OF SCRUTINY IS 'COMPLETE', WHICH HAS BEEN GENERATED THROUGH THE SYSTEM. /TRUE COPY/ P.S.TO JUDGE K. Vinod Chandran, J ---------------------------------------- W.P.(C).No.1702 of 2017-K ----------------------------------------- Dated this the 16[th] day of February, 2017 JUDGMENT The petitioner is aggrieved with the assessment order passed for the assessment year 2014-15. The petitioner allegedprocedural irregularity in the assessment carried on by theAssessing Officer. The assessment order impugned is produced atExhibit P4. 2. The petitioner was issued with a notice underSection 143(2) of the Income Tax Act, 1961 [for brevity “the Act”] byExhibit P1. The petitioner is said to have appeared before theAssessing Officer. Subsequently a notice under Section 142(1) ofthe Act was issued as per Exhibit P2. The petitioner was alsoasked to furnish certain details as is found from Exhibit P3. TheAssessing Officer then finalised the assessment as per Exhibit P4. 3. The learned Counsel for the petitioner takes methrough Section 143(2) to contend that there is a requirement tointimate the assessee, in the notice issued under Section 143(2) of WP(C) No.1702 of 2017 2. The petitioner was issued with a notice underSection 143(2) of the Income Tax Act, 1961 [for brevity “the Act”] byExhibit P1. The petitioner is said to have appeared before theAssessing Officer. Subsequently a notice under Section 142(1) ofthe Act was issued as per Exhibit P2. The petitioner was alsoasked to furnish certain details as is found from Exhibit P3. TheAssessing Officer then finalised the assessment as per Exhibit P4. 3. The learned Counsel for the petitioner takes methrough Section 143(2) to contend that there is a requirement tointimate the assessee, in the notice issued under Section 143(2) of WP(C) No.1702 of 2017 the Act; the particulars of claim of loss, exemption, deduction,allowance or relief, to substantiate which the assessee has toproduce further evidence or particulars. It is contended that theCircular of Central Board of Direct Taxes [for brevity "CBDT"] asper Instruction No.20/2015 dated 29.12.2015 requires certainformalities to be followed, which have not been complied with. Theassessee has also not been served with a proper notice underSection 142(1) of the Act and the demand to furnish documentsmade as per Exhibit P3 was served on the assessee on the justprevious day. The learned Counsel relied on a Division Benchjudgment of this Court reported in Travancore Diagnostics (P)Ltd. v. Asst. Commissioner of Income Tax[2016 (4) KLT 350]. 4. The learned Standing Counsel for the Departmentwould contend that Computer Aided Scrutiny Selection (CASS), ashas been done in the present case, is a system generated notice;which has been issued to the petitioner by Exhibit P1. Thepetitioner appeared before the Assessing Officer through theauthorised representative after the notice was issued. The entireparticulars required was also intimated to the petitioner by way of questionnaire accompanying the notice under Section 143(2) ofthe Act. The questionnaire has not been produced in the presentcase. It is submitted that in the circumstance of an appearance bythe assessee or the authorised representative before theAssessing Officer the subsequent notices could be served on suchperson who appears and there could be no claim of the notice notbeing properly served or timely served in the teeth of theprovisions of Section 292BB. It is also contended that thelimitation was fast approaching on 31.12.2016 and the assesseehaving participated in the enquiry and also having sought foradjournment twice, the Assessing Officer concluded theassessment by Exhibit P4, the impugned order. 5. In the present case, it is also submitted by thelearned Standing Counsel for the respondent that the specificrequirements to be specified in the system generated notice underthe Computer Aided Scrutiny Selection had not been uploadedproperly and in such circumstance the impugned notice wasissued, as found in Exhibit P1. As of now the system generatednotices specify the particulars required as available under Section WP(C) No.1702 of 2017 143(2) and CBDT Circular. In such circumstances, without goinginto the merits of the matter and a declaration on whether theproceedings carried out were valid, it could as well be directed thatthe petitioner's assessment be completed after a proper notice isissued. 5. In the present case, it is also submitted by thelearned Standing Counsel for the respondent that the specificrequirements to be specified in the system generated notice underthe Computer Aided Scrutiny Selection had not been uploadedproperly and in such circumstance the impugned notice wasissued, as found in Exhibit P1. As of now the system generatednotices specify the particulars required as available under Section WP(C) No.1702 of 2017 143(2) and CBDT Circular. In such circumstances, without goinginto the merits of the matter and a declaration on whether theproceedings carried out were valid, it could as well be directed thatthe petitioner's assessment be completed after a proper notice isissued. 6. In the context of the notice at Exhibit P1 being onesystem generated and there is no possibility of a further generationof a similar notice under Section 143(2), the Assessing Officershall issue a notice to the petitioner showing the particulars whichare required and in such circumstance, the petitioner shall appearbefore the Assessing Officer with objections, if any. The learnedCounsel for the petitioner submits that the petitioner would requiresome time to collect the details. But since the assessment wasalready pending before the Department and the authorisedrepresentative was also appearing before the officer, the saidrequest is declined. Only due to the technical defect of theparticulars having not been supplied, this Court is interfering withthe procedure. It is made clear that no interference is made to thenotice under Section 143(2) or Section 142(1) of the Act especially when the entire particulars as required in the notice issued underSection 142(1) has not been produced. 7. In such circumstances, only to cure the defect of theentire particulars having not been put to the petitioner, thepetitioner or their authorised representative shall appear before theAssessing Officer on 03.03.2017; on which day the noticespecifying the particulars to be furnished shall be issued andpersonal acknowledgment taken. The Assessing Officer shall givethe petitioner three weeks time to file objections from that date andalso specify a date of hearing and on that fixed date the hearingshall be proceeded with and assessment completed. Exhibit P4 isset aside to facilitate fresh assessment. The writ petition is disposed of, specifically observingthat there is no order on the merits of the case. Parties are left tosuffer their respective costs. Vku/- Sd/-K.Vinod ChandranJudge. [ true copy ]