Wp(C)/18182/2022 Of Nambiar Balakrishnan Narendran v. The Income Tax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 25 DAY OF NOVEMBER 2022 / 4TH AGRAHAYANA, 1944 WP(C) NO. 18182 OF 2022 PETITIONER: NAMBIAR BALAKRISHNAN NARENDRANAGED 62 YEARSSATHYENDRAM, NEAR GANDHI MAIDAN, PAYYANNUR P. O., TALIPARAMBA, KANNUR - 670307. BY ADV S.ARUN RAJ RESPONDENTS: 1THE INCOME TAX OFFICER,WARD - 3, AAYAKAR BHAVAN, KANNUR – 670 006. 2THE PRINCIPAL COMMISSIONER OF INCOME TAX AAYAKAR BHAVAN, MANANCHIRA, KOZHIKODE - 673001. ADV. CHRISTOPHER ABRAHAM (SC) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON25.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: JUDGMENT The petitioner has approached this Court beingaggrieved by the fact that proceedings were taken againsthim under Section 148 of the Income Tax Act, 1961 ('the Act'for short) without following the procedure contemplated bythe provisions of Section 148A of the Act. It is the case of thepetitioner that after amendment to the provisions of IncomeTax Act in the year 2021 [by the Finance Act of 2021] beforereassessment proceedings are initiated under Section 148 ofthe Act, it was incumbent on the officer to serve a showcause notice as contemplated by Section 148A of the Act. Itwas also pointed out that a minimum of seven days is to begiven to the petitioner to reply to the same. The learnedcounsel for the petitioner submits that the notice underSection 148A of the Act was not actually served on thepetitioner prior to the issuance of notice under Section 148 ofthe Act and the notice under Section 148A of the Act wassubsequently served by messenger. It is submitted that thepetitioner did not get any time to respond to the notice underSection 148A of the Act and therefore, the proceedingsinitiated against the petitioner under Section 148 of the Act are incompetent and contrary to law. 2.The learned Standing Counsel appearing for therespondent Department refers to the counter affidavit filed bythe 1[st] respondent in this case where in paragraph 7 it isstated as follows: ”However, in view of the contention of the petitionerregarding the correctness of the information relied bythe Revenue as referred to in para.6 above, it isprayed that the Revenue may kindly be permitted toissue a fresh notice u/s 148A to verify the above factsand take further steps in this matter as providedunder law.” In response to the averment to the petitioner that thenotice under Section 148A of the Act was never served on thepetitioner before the issuance of notice under Section 148 ofthe Act, it is stated in paragraph 5 of the counter affidavit asunder: “In response to the above averments of thepetitioner, this deponent submits as under. Noticeu/s 148 A(b) was issued on 18.03.2022 allowing timeupto 24.03.2022 to the assessee to respond to thenotice. This means that including the date of issueof the notice, 7 days time was allowed to theassessee to respond to the notice. Therefore thecontention raised in this regard by the petitioner isnot correct. However, as per the details available inthe system, delivery of notice u/s 148 A(b) issued on 18.03.2022 is not verifiable and therefore electronicdelivery of notice cannot be proved. Though a hardcopy of the notice was also sent by post, it wasreturned undelivered” It is in these circumstances, that the 1[st] respondent hasstated that the Department may be permitted to issue freshnotice under Section 148A of the Act and continue with theproceedings in due compliance with the law. 18.03.2022 is not verifiable and therefore electronicdelivery of notice cannot be proved. Though a hardcopy of the notice was also sent by post, it wasreturned undelivered” It is in these circumstances, that the 1[st] respondent hasstated that the Department may be permitted to issue freshnotice under Section 148A of the Act and continue with theproceedings in due compliance with the law. 3.The learned counsel for the petitioner states thatthis Court may not grant any permission to the respondentDepartment to continue with the fresh proceedingscontemplated and the fresh proceedings may be permittedonly if they are authorized by law. Since it is clear that thereis no record to suggest that the procedure contemplated u/s148A of the Act were followed before issuing notice underSection 148 of the Act, this writ petition is allowed. Exts.P1and P4 are quashed without prejudice to the right of theDepartment to initiate fresh proceedings in accordance withlaw. The learned counsel for the petitioner states that Sd/-GOPINATH P.JUDGE APPENDIX OF WP(C) 18182/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE NOTICE DATED 18-3-2022 UNDER SECTION 148A(B) OF THE ACT FOR THE AY 2018-19 OF THE 1ST RESPONDENT WHICH WAS GIVEN BY HAND ON 18-4-2022. Exhibit P2 TRUE COPY OF THE SMS ALERT RECEIVED INTHE MOBILE PHONE FROM THE INCOME TAX DEPARTMENT ON 25-4-2022. Exhibit P3 TRUE COPY OF THE ORDER DATED 30-3-2022OF THE 1ST RESPONDENT U/S 148A(D) OF THE ACT FOR THE AY 2018-19 UPLOADED ON25-4-2022 IN THE INCOME TAX WEB PORTALACCOUNT. Exhibit P4 TRUE COPY OF THE NOTICE DATED 30-3-2022 OF THE 1ST RESPONDENT U/S 148 OF THE ACT FOR THE AY 2018-19 UPLOADED ON25-4-2022 IN THE INCOME TAX WEB PORTALACCOUNT. Exhibit P5Exhibit P6Exhibit P7 TRUE COPY OF THE LETTER DATED 26-4-2022 SENT BY THE PETITIONER TO THE 1STRESPONDENT FOR THE AY 2018-19. TRUE COPY OF THE JUDGMENT DATED 12-5-2022 IN WP(C) NO. 7385 OF 2022 PASSED BY THE HIGH COURT OF DELHI. TRUE COPY OF THE NOTIFICATION NO. 2/2016 DATED 3-2-2016 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES, NEW DELHI.