Wp(Md)/1952/2020 Of Kalidoss Bharath v. The Asst. Commissioner Of Income Tax

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT THE HONOURABLE MRS.JUSTICE J.NISHA BANU Kalidoss Bharath... Petitioner The Assistant Commissioner of Income Tax,Income Tax Circle 2(1) Trichy,3[rd] Floor, Trichy Main Building,Williams Road, Cantonment,Tiruchirappalli-620 001. Petition filed under Article 226 of the Constitution of India,for issuance of Writ of Certiorari, to call for the records of therespondent in PAN vide Order No.ITBA/AST/S/143(3)/2019-20/1022872487(1) dated 22.12.2019 and raised a demand under Section156 of the Income Tax Act in No.ITBA/AST/S/156/2019-20/1022872526(1)dated 22.12.2019 and quash the same as ex-facie illegal, arbitrary,without jurisdiction and against the principles of natural justice. ORDER This writ petition has been filed for issuance of a Writ ofCertiorari, to call for the records of the respondent in PANAFVPB1366G vide Order No.ITBA/AST/S/143(3)/2019-20/1022872487(1)dated 22.12.2019 and raised a demand under Section 156 of the IncomeTax Act in No.ITBA/AST/S/156/2019-20/1022872526(1) dated 22.12.2019and quash the same as ex-facie illegal, arbitrary, withoutjurisdiction and as against the principles of natural justice. 2.The petitioner is a dealer in Petroleum products and for theassessment year 2017-18, the petitioner filed audit report underSection 44AB of the Income Tax Act and on that basis, assessment hasbeen completed. Subsequently, a notice was issued by the DeputyCommissioner of Income Tax, Thanjavur, on 04.09.2019 under Section142(1) of the Act, for which, a reply was filed on 15.11.2019enclosing the statement showing the month-wise purchase and saleseffected during the year. Subsequently, the respondent had issued ahttps://hcservices.ecourts.gov.in/hcservices/ notice under Section 142(1) of the Act seeking fresh detailsincluding the details for the assessment year 2016-2017 even thoughthe assessment year is 2017-18. The petitioner sent further replyon 09.12.2019 and thereafter vide letter dated 12.12.2019 soughtfurther time to file the voluminous details upto 26.12.2019. Therespondent did not consider the letter dated 12.12.2019 but referredthe letter dated 09.12.2019 and passed the assessment order andclosed the Portal on 17.12.2019 and therefore, the petitioner hasfiled the present writ petition stating that the impugned order hasbeen passed against the principles of natural justice and alsoagainst the circular issued by the Directorate of Income Tax on26.12.2019 in which it was informed that the facility for electronicsubmission of documents shall be automatically closed on 29.12.2019. 3.The learned counsel for the petitioner would state that therespondent has no jurisdiction to assess under e-proceedings whenadmittedly Section 143(3A) of the Income Tax Act was amended witheffect from 01.04.2020 giving the right to make e-assessmentproceedings under Section 144 and therefore, the e-assessment orderpassed by the respondent is bad in law. The learned counsel for thepetitioner would further state that the respondent has assessed theincome under the amended Section 115BBE of the Act when admittedlythe amendment came into effect on 01.04.2017 i.e., from the previousyear 2017-2018 i.e., from the assessment year 2018-2019 and not forthe assessment year 2017-2018. According to the petitioner, becauseof the wrong application of the amended provision, huge liabilitywas raised by the respondent and the petitioner is put to greathardship and mental agony and therefore, the petitioner is beforethis Court. 4.He would further state that even on similar occasion inW.P.No.1178 and 1182 of 2020 dated 27.01.2020, the assessmentorders made without granting further time as requested by theassessee, were set aside and the matter was remitted to therespondent for making de nova assessment. Subsequently, therespondent in his proceedings dated 26.03.2021, has passed an orderaccepting the claim of the assessee and therefore, the learnedcounsel for the petitioner would state that the assessment orderspassed by the respondent herein without giving opportunity to thepetitioner herein in spite of his request for adjournment, is aclear violation of the principles of natural justice and therefore,the impugned orders are liable to be set aside on the said ground. 5.The learned Senior Standing Counsel for the respondent wouldstate that when there is an effective statutory appeal available tothe petitioner, he cannot bypass the same. He would further statethat the petitioner's case was selected for scrutiny throughComputer Aided Scrutiny Selection(CASS) in Income Tax BusinessApplication Module and a notice under Section 143(2) of the Act wasissued on 09.08.2018 by the Assistant Commissioner of Income Tax,https://hcservices.ecourts.gov.in/hcservices/Circle-1, Thanjavur. Further notice under Section 142(1) was issued on 04.09.2019 calling for details in connection with cash depositsmade during demonitization period to be submitted on or before12.09.2019 electronically. According to the respondent, thepetitioner had submitted details on 15.11.2019 partially andthereafter further notice under Section 142(1) read with Section 129was issued on 03.12.2019 to furnish accounts and documents to besubmitted on or before 07.12.2019. He would further state that thatpetitioner has filed adjournment petition dated 10.12.2019 seekingfurther extension of time upto 26.12.2019 and the Assessing Officerdid not entertain the adjournment petition because the time limit tocomplete the assessment expired on 31.12.2019 and therefore, theassessment order was concluded under Section 144 of the Act i.e.,best judgment assessment and the impugned orders came to be passed. 6.Heard the learned counsel for the petitioner as well as thelearned Senior Standing Counsel for the respondent. 7.Admittedly, the assessment order has been concluded in spiteof the petitioner's request seeking further time for making hisreply. Admittedly, the petitioner was not given opportunity by therespondent by not considering his adjournment petition dated10.12.2019, but has referred to only the letter dated 09.12.2019 andhas closed the Portal on 17.12.2019. The main contention raised inthe counter is that the Assessing Officer did not entertain theadjournment petition of the petitioner, because the time limit tocomplete the assessment expired on 31.12.2019. The petitioner hasnot submitted the details as called for through the notice dated03.12.2019. Since the petitioner has failed to discharge the burdenof proof for the cash deposit of SBN note to the tune ofRs.1,84,87,858/-, the respondent had no other option except toconclude the assessment under Section 144 of the Act i.e., bestjudgment assessment. The said contention cannot be accepted for thesimple reason that the petitioner has filed adjournment petition on12.12.2019 seeking further time upto 26.12.2019. Admittedly, theAssessing Officer did not entertain the said adjournment petition. 8.This Court in similar matters cited by the petitioner whereassessment orders passed without granting further time, set asidethe assessment orders therein and remitted the matter to theauthority concerned for fresh consideration. Admittedly, here also,the petitioner's petition for adjournment has not been consideredand therefore, it is a case of violation of principles of naturaljustice. No personal hearing was also granted. If atleast personalhearing is granted to the petitioner, the petitioner would haveexplained his case. Though the respondent has raised many othercontentions, since the impugned orders have been passed withoutconsidering the petitioner's adjournment petition, without advertingto the other merits of the case, only on the ground of violation ofprinciples of natural justice, I am inclined to set aside theimpugned orders.https://hcservices.ecourts.gov.in/hcservices/ 9.Accordingly, the impugned orders of the respondent in PANAFVPB1366G vide Order No.ITBA/AST/S/143(3)/2019-20/1022872487(1)dated 22.12.2019 and the demand under Section 156 of the Income TaxAct in No.ITBA/AST/S/156/2019-20/1022872526(1) dated 22.12.2019 areset aside and the matter is remitted back to the respondent to passfresh order after giving opportunity to the petitioner for makinghis detailed reply and after affording opportunity of personalhearing, within a period of three months from the date of receipt ofa copy of this order. 10.With the above direction, this Writ Petition is allowed. Nocosts. Consequently, connected miscellaneous petitions are closed. // True Copy // Assistant Registrar / /2021 Sub Assistant Registrar(CS) bala To The Assistant Commissioner of Income Tax,Income Tax Circle 2(1) Trichy,3[rd] Floor, Trichy Main Building,Williams Road, Cantonment,Tiruchirappalli-620 001. ORDER MADE INW.P(MD)No.1952 of 2020DATED : 23.07.2021 cm(CO)TR(06.08.2021) 4P 2C https://hcservices.ecourts.gov.in/hcservices/