Wp(C)/24872/2023 Of Muhammed Kallat v. Income Tax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 12 DAY OF JANUARY 2024 / 22ND POUSHA, 1945 WP(C) NO. 24777 OF 2023 PETITIONER: MUHAMMED KALLAT,KALLAT VILLA, NEAR MCF SCHOOL, BYE PASS ROAD, KALPETTA, WAYANAD, KERALA, PIN – 673121. BY ADVS. SRI. ANIL D. NAIR SMT. TELMA RAJU SMT. AADITYA NAIR RESPONDENTS: 1INCOME TAX OFFICER,WARD INTERNATIONAL TAXATION , AAYAKAR BHAVAN, NORTH BLOCK, NEW ANNEXE BUILDING, MANANCHIRA, KOZHIKODE, PIN – 673001. 2DISPUTE RESOLUTION PANEL-2, BENGALURU,'A' WING, 4TH FLOOR, KENDRIYA SADAN, KORAMANGALA, BANGALORE, PIN – 560034. BY ADVS. SRI. JOSE JOSEPH – SC - INCOME TAX DEPARTMENT SRI. KEERTHIVAS GIRI - SC SRI. P. G. JAYASHANKAR - SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON12.01.2024, ALONG WITH WP(C).24872/2023, THE COURT ON THE SAME DAYDELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAMPRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 12 DAY OF JANUARY 2024 / 22ND POUSHA, 1945WP(C) NO. 24872 OF 2023 PETITIONER: MUHAMMED KALLAT,KALLAT VILLA, NEAR MCF SCHOOL, BYE PASS ROAD, KALPETTA, WAYANAD, KERALA, PIN – 673121. BY ADVS. SRI. ANIL D. NAIR SMT. TELMA RAJU SMT. AADITYA NAIR RESPONDENTS: 1INCOME TAX OFFICER,WARD INTERNATIONAL TAXATION , AAYAKAR BHAVAN, NORTH BLOCK, NEW ANNEXE BUILDING, MANANCHIRA, KOZHIKODE, PIN – 673001. 2DISPUTE RESOLUTION PANEL-2, BENGALURU,'A' WING, 4TH FLOOR, KENDRIYA SADAN, KORAMANGALA, BANGALORE, PIN – 560034. BY ADVS. SRI. JOSE JOSEPH – SC - INCOME TAX DEPARTMENT SRI. KEERTHIVAS GIRI - SC SRI. P. G. JAYASHANKAR – SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSIONON 12.01.2024, ALONG WITH WP(C).24777/2023, THE COURT ON THESAME DAY DELIVERED THE FOLLOWING: DINESH KUMAR SINGH, J. -------------------------- W.P.(C) Nos. 24777 & 24872 of 2023 ------------------------- Dated this the 12[th] day of January, 2024 JUDGMENT 1.Petitioner/assessee is a Non Resident Indian (NRI). In respect ofthe relevant assessment years i.e. 2013-14 and 2014-15, the assesseedid not file return of his income. The petitioner/assessee along withMr. Aboobacker had constructed a Mall at Mananthavady in the nameand style of M/s. Mall of Kallat. In the said Mall, thepetitioner/assessee owns 75% share. ADIT Investigation wing,Kozhikode conducted verification on 18.04.2019 and information wasgathered relating to the information made by the petitioner in thesaid Mall. As per the details obtained, total investment in the Mallfrom 2012 to 2014 was Rs. 3.97 crores and the assessee had investedmore than Rs. 40,00,000/- in the assessment year 2013-14 and Rs.50,00,000/- during the assessment year 2014-15. 2.The petitioner being an NRI, he is an “eligible assessee” underSub-Section 15 (b) (ii) of Section 144 C of the Income Tax Act, 1961(hereinafter referred to as ‘the Act’ for short). The draft assessmentorder was prepared by the assessing authority and the same wasserved on the petitioner on 30.05.2023 online, giving thirty days time for him to file objection, if any, before the Disputes Resolution Panel against the said draft assessment order. It appears that thepetitioner filed objection to the draft assessment order on30.06.2023 but, the said objection was not filed in the correct form.The objections in respect of the two draft assessment orders withrespect to the assessment years 2013-14 and 2014-15 has not beentaken into consideration and the impugned assessment orders inExhibit P-9 have been passed. 3.Mr. Anil D. Nair, learned Counsel for the petitioner submits that for him to file objection, if any, before the Disputes Resolution Panel against the said draft assessment order. It appears that thepetitioner filed objection to the draft assessment order on30.06.2023 but, the said objection was not filed in the correct form.The objections in respect of the two draft assessment orders withrespect to the assessment years 2013-14 and 2014-15 has not beentaken into consideration and the impugned assessment orders inExhibit P-9 have been passed. 3.Mr. Anil D. Nair, learned Counsel for the petitioner submits that the petitioner had filed objection to the draft assessment orders inExhibit P-1 within thirty days. However, by inadvertent mistake, theobjection was not filed in the correct form but, this was a defectwhich could have been cured by the petitioner if it was pointed out tohim. Therefore, it cannot be said that the petitioner had not filed theobjection within thirty days as observed in the impugned assessmentorders. The petitioner should have been provided an opportunity forcuring the defects in filing the objections to the draft assessmentorder which was not done and no opportunity of hearing wasprovided to the petitioner on the said ground that no objectionagainst the draft assessment order under Section 144C(3) of the Actwas filed. He therefore, submits that the impugned assessment orders in Exhibit P-9 may be set aside and the matter may be remanded back for giving one opportunity to the petitioner to filefresh objection to the draft assessment orders in Exhibit P-1 orallowing him to cure the defect and file the objection to the draftassessment orders in correct form. 4.Mr. P. G. Jayashankar, learned Senior Standing Counsel for theIncome Tax Department has submitted that Form No. 35A is providedfor filing the objection to the draft assessment order under Section147(3). However, the objection was filed in Form 34BC and,therefore, the assessing authority has taken the view that noobjection was filed as mandated under Section 144C(3). 5.I have considered the submissions. It is not in dispute that thepetitioner had filed the objection on 30.06.2023. However, the saidobjection was filed in Form 34BC instead of 35A. The petitionerought to have been given an opportunity to cure the defects.However, this opportunity was not given to the petitioner for curingthe defects and the Disputes Resolution Panel considered that noobjection was filed within thirty days as it was not filed in the properform. 6.There was objection filed by the petitioner. The defect wascurable defect and the petitioner ought to have been given an opportunity to file objection in the correct form. Therefore, I am ofthe view that by not giving an opportunity to cure the defect in filingthe objection to the draft assessment order, the Dispute ResolutionPanel as well as the Assessing Officer have committed an error of lawand there has been a violation of the principles of natural justice.Thus, the present writ petition is allowed. The petitioner is permittedto file objection dated 30.06.2023 in respect of the assessment years2013-14 and 2014-15 within a period of two weeks and if theobjection dated 30.06.2023 is filed within two weeks in correct formi.e. Form 35A, the Disputes Resolution Panel shall consider theobjection and, thereafter, pass an order after hearing the petitioner.Once the Disputes Resolution Panel passes an order after takingobjection on the draft assessment order, the assessing authority shallproceed to finalise the assessment in respect of the assessment years2013-14 and 2014-15. With the aforesaid directions, the present writ petition is allowed. Svn Sd/- DINESH KUMAR SINGH JUDGE APPENDIX OF WP(C) 24777/2023 PETITIONER’S EXHIBITS With the aforesaid directions, the present writ petition is allowed. Svn Sd/- DINESH KUMAR SINGH JUDGE APPENDIX OF WP(C) 24777/2023 PETITIONER’S EXHIBITS EXHIBIT P1TRUE COPY OF DRAFT ASSESSMENT ORDER FOR THEASSESSMENT YEAR 2013-14 DATED 30.5.2023ISSUED BY THE 1ST RESPONDENTASSESSMENT YEAR 2013-14 DATED 30.5.2023ISSUED BY THE 1ST RESPONDENT EXHIBIT P2TRUE COPY OF THE PASSPORT OF THE PETITIONER EXHIBIT P3TRUE COPY OF THE LETTER DATED 30.06.2023ADDRESSED TO THE 2ND RESPONDENT BY THEPETITIONERADDRESSED TO THE 2ND RESPONDENT BY THEPETITIONER EXHIBIT P4TRUE COPY OF OBJECTION FILED BY THEPETITIONERPETITIONER EXHIBIT P5TRUE COPY OF THE REPLY FILED IN FORM 34BC BYTHE PETITIONERTHE PETITIONER EXHIBIT P6TRUE COPY OF THE E-MAIL ADDRESSED TO THEPETITIONER BY THE 2ND RESPONDENTPETITIONER BY THE 2ND RESPONDENT EXHIBIT P7TRUE COPY OF THE LETTER DATED 19.07.2023ADDRESSED TO THE 2ND RESPONDENT BY THEPETITIONERADDRESSED TO THE 2ND RESPONDENT BY THEPETITIONER EXHIBIT P8TRUE COPY OF THE LETTER DATED 20.07.2023ADDRESSED TO THE PETITIONER BY THE 2NDRESPONDENTADDRESSED TO THE PETITIONER BY THE 2NDRESPONDENT EXHIBIT P9TRUE COPY OF THE ASSESSMENT ORDER DATED19.07.2023 ISSUED BY THE 1ST RESPONDENT19.07.2023 ISSUED BY THE 1ST RESPONDENT 1ST RESPONDENT’S ANNEXURES ANNEXURE R1(A)TRUE COPY OF THE ACKNOWLEDGEMENT SLIP ANNEXURE R1(B)TRUE COPY OF THE SPEED POST TRACKINGPRINTOUTPRINTOUT ANNEXURE R1(C)TRUE COPY OF THE SCREEN SHOT ANNEXURE R1(D)TRUE COPY OF THE SCREEN SHOT APPENDIX OF WP(C) 24872/2023 PETITIONER’S EXHIBITS