Wp(C)/5784/2021 Of Ayyappa Roller Flour Mills Ltd v. Income Tax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE A.M.BADAR FRIDAY, THE 05TH DAY OF MARCH 2021 / 14TH PHALGUNA, 1942 WP(C).No.5784 OF 2021(W) PETITIONER: AYYAPPA ROLLER FLOUR MILLS LTD.DOOR NO.V/679-C, INDUSTRIAL DEVELOPMENT AREA, MUPPATHADAM P.O., EDAYAR, COCHIN-683 110, REPRESENTEDBY THE PRINCIPAL OFFICER, S.K.GUPTA, MANAGING DIRECTOR, AGED 80 YEARS, S/O.B.D.GUPTA, RESIDING AT SAKET, JACOB VALLANAT ROAD, ERNAKULAM NORTH P.O., COCHIN, PIN-682 018. BY ADVS.SRI.P.SATHISANSMT.DONA AUGUSTINE RESPONDENTS: 1INCOME TAX OFFICERCORPORATE WARD-1(1), OFFICE OF THE JOINT COMMISSIONEROF INCOME TAX, CORPORATE RANGE I, KOCHI, 5TH FLOOR, C.R. BUILDING, IS PRESS ROAD, ERNAKULAM NORTH P.O., COCHIN-682 018. 2THE PRINCIPAL COMMISSIONER OF INCOME TAX,OFFICE OF THE PRINCIPAL COMMISSIONER OF INCOME TAX, KOCHI-1, CENTRAL REVENUE BUILDING, I.S.PRESS ROAD, ERNAKULAM NORTH P.O., COCHIN-682 018. SC- SRI. JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON05.03.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: JUDGMENT Dated this the 5th day of March 2021 Heard the learned counsel for the petitioner. 2.Learned counsel for the petitioner submits that thepetitioner has sold its properties as per registered sale deed during theassessment year 2012-2013. However, the registered sale agreementwas stating that the possession was handed over in the previous yearand therefore, the assessment was preponed to assessment year2011-2012. The learned counsel for the petitioner submits that theassessment order was made by the assessing officer and feelingaggrieved by the same, the petitioner preferred an appeal before theCommissioner of Income Tax. The assessment order was modified inappeal. However, the department has filed their appeal before theIncome Tax Appellate Commissioner and accordingly, the order atExt.P1 came to be passed. The learned counsel for the petitionersubmits that the learned Tribunal was pleased to direct the assessingofficer to get the valuation report for the impugned property from theDVO and to decide the issue afresh. My attention was drawn to theorder of the learned ITAT at Ext.P1. With this, it is argued that theorder of the Income Tax Appellate Commissioner was duly compliedand the assessment order at Ext.P2 was passed on 06/05/2020 by the Income Tax Officer by considering the report of the DVO. The learnedcounsel for the petitioner submits that without there being any reason,the 2[nd] respondent-Principal Commissioner of Income Tax has decidedto initiate suo motu revision by contending that the order of theIncome Tax Officer is erroneous as it is prejudicial to the interest ofthe Revenue. The learned counsel for the petitioner drew my attentionto the notice of suo motu revision proceedings issued by the 2[nd]respondent which is at Ext.P4. It is argued that the said notice is notin consonance with the powers of revision as stated in Section 263 ofthe Income Tax Act. The learned counsel for the petitioner arguedthat it is not a case of an order being passed without making anenquiry or verification which should have been made. The learnedcounsel argued that the assessment order is passed by the IncomeTax Officer on the basis of the Appellate Order passed by the learnedIncome Tax Appellate Tribunal and the valuation report was calledfrom the DVO. The same was considered and that is how, theassessment was done, vide order at Ext.P2. Therefore, in submissionof the learned counsel for the petitioner, the 2[nd] respondent-PrincipalCommissioner of Income Tax is not justified in taking up suo moturevisional proceedings by a show cause notice at Ext.P4. the petition by contending that the matter is only at the show-causenotice and no final order is passed. the petition by contending that the matter is only at the show-causenotice and no final order is passed. 4.I have considered the submissions so advanced and alsoperused the impugned order at Ext.P4. The impugned order at Ext.P4is merely a show-cause notice. It is averred in the show-cause noticethat the valuation report of the DVO, Thiruvananthapuram isreportedly incorrect as communicated by the Asst. Engineer and theChief Engineer vide letter dated 19.05.2020. 5.The learned counsel for the petitioner submits that the saidreport dated 19.05.2020 was not before the Assessment Officer whohas passed the Assessment order on 06.05.2020, and as such itcannot be relied upon for exercising revisional powers. However,though the said report might not be before the assessing officer, thePrincipal Commissioner can certainly use such report for exercising suomoto revisional jurisdiction. The matter is at the stage of show-causenotice. The 2[nd] respondent has proposed to revise the assessment orderat Ext.P2 and for that purpose, objections of the petitioner are invited.Opportunity of hearing is also to be granted to the petitioner vide show-cause notice at Ext.P4. Thus the petitioner shall have full opportunityto put up its case before the revisional authority. At this stage, itcannot be said that the 2[nd] respondent revisional authority is biased and is bent upon to decide the matter adversly. Official acts areregularly done in wise principle of law and hence without there beingany material on record, it cannot be said that issuance of show-causenotice reflects nothing but a biased attitude of the 2[nd] respondent. ThisCourt hope and expect that the 2[nd] respondent shall determine theissue in accordance with the provision of law without being influencedby the fact that the petitioner had approached this Court by filing writpetition. Hence, I do not feel it proper to interfere in the show-causenotice issued by the revisional authority, which has the power to revisethe assessment order suo motu. The petition therefore fails and thesame is accordingly dismissed. Nsd//true copy//PA to Judge Sd/- A.M.BADAR JUDGE APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ORDER DATED 09.05.2019 IN ITA NO.458/COCH/2018 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, COCHIN. EXHIBIT P2 TRUE COPY OF ASSESSMENT ORDER NO.AACCA684OM/CORP WARD I(1) EKM/2019-20 DATED 06.05.2020 PASSED BY THE 1ST RESPONDENT. EXHIBIT P3 TRUE COPY OF THE RELEVANT EXTRACT OF ASSESSMENT ORDER DATED 27.03.2014. EXHIBIT P4 TRUE COPY OF THE NOTICE F NO.PCIT01/CHN/R/263/17/2020-21 DATED 08.02.2021 ISSUED BY THE 2ND RESPONDENT.