AZUGA TELEMATICS PRIVATE LIMITED V. THE ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER OF INCOME TAX / INCOME TAX OFFICER

WP/15073/2021

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The case involves Azuga Telematics Private Limited, which filed a writ petition against the final assessment order passed by the Income Tax Officer, National E-Assessment Centre, Delhi, and the Deputy Commissioner of Income Tax, Circle 1(1)(1), Bangalore. The petitioner challenged the assessment order dated 12.05.2021, arguing that it was passed prematurely before the extended deadline for filing objections, as granted by a CBDT circular due to the COVID-19 pandemic. The court found that the Assessing Officer acted arbitrarily and without jurisdiction by passing the order before the expiry of the extended period for objections, leading to the quashing of the assessment order and directions for reconsideration by the DRP.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 695674 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 09-12-2021
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: SANDEEP HUILGOL
• Keywords: Assessment Order; CBDT Circular; Income Tax; Writ petition; Extended Time for Filing Objections
• Section: 143(3); 144B; 144C(3)

Judgement Text

"IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9TH DAY OF DECEMBER, 2021 BEFORE THE HON’BLE MR.JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO.15073 OF 2021 (T–IT) BETWEEN: AZUGA TELEMATICS PRIVATE LIMITED UNIT NO.A2, 7TH FLOOR, DIVYASREE TECHNOPOLIS BUILDING 4, 77 TOWN CENTER, HAL AIRPORT ROAD YEMALUR, BANGALORE - 560 037 REPRESENTED HEREIN BY ITS DIRECTOR MR. BADRINATH ASODU KRISHNARAJ ... PETITIONER (BY SRI. SANDEEP HUILGOL, ADVOCATE) AND: 1. THE ADDITIONAL / JOINT / DEPUTY ASSISTANT/ COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, NATIONAL E-ASSESSMENT CENTRE, DELHI ROOM NO.401, 2ND FLOOR, E-RAMP JAWAHARLAL NEHRU STADIUM NEW DELHI-110003. 2. THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 1 (1)(1), BANGALORE BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU-560095. ... RESPONDENTS (BY SRI K V ARAVIND, ADVOCATE ) ----- THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED FINAL ASSESSMENT ORDER DATED 12.05.2021 PASSED BY THE R1 U/S 143(3) R/W SECTIONS 144C(3) AND 2 144B OF THE INCOME-TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2017-18 ANNEXURE-A AND ETC., THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING THROUGH VIDEO CONFERENCE : O R D E R In this petition, the petitioner seeks quashing of final impugned assessment order at Annexure-A dated 12.05.2021, computation sheet dated 12.05.2021 at Annexure-A1 and demand notice at Annexure-A2 dated 12.05.2021 and for other reliefs. 2. Heard learned counsel for petitioner and learned counsel for respondents and perused the material on record. 3. In addition to reiterating the various contentions urged in the petition and referring to the documents produced by the petitioner, learned counsel for the petitioner submits that subsequent to the Assessing Officer passing the draft Assessment Order on 07.04.2021, the Central Board of Direct Taxes (CBDT) issued a circular dated 30.04.2021 extending the time for filing objections to the draft Assessment Order up to 31.05.2021 as permitted under Section 144C(2)(b) of the Income Tax Act, 1961 (for short 'the I.T. Act') in view of the 3 second wave of Covid-19 pandemic exigency. It is submitted that despite the aforesaid extension of time granted/permitted by the CBDT up to 31.05.2021, the Assessing Officer has proceeded to pass the impugned Assessment Order on 12.05.2021 itself, much prior to the extended period, which was due to expire on 31.05.2021. It is further submitted that on 18.05.2021, the petitioner filed his objections to the draft Assessment Order with the DRP and also addressed several communications at Annexure-E series ventilating its grievances, which have not been considered by the respondents and as such, the petitioner is before this Court by way of the present petition. 4. Per contra, learned counsel for the respondents submits that there is no merit in the petition and the same is liable to be dismissed. 5. As rightly contended by the learned counsel for the petitioner, the undisputed material on record clearly indicates that subsequent to issuance of the draft Assessment Order dated 07.04.2021, the CBDT circular extended the time for filing objections to the said order up to 31.05.2021; in 4 other words, though the period prescribed for filing objections to the draft Assessment Order was supposed to expire on 06.05.2021, the same was extended up to 31.05.2021 up to which date the petitioner was entitled to submit his objections; in view of the extension of time up to 31.05.2021 by virtue of the CBDT circular, the Assessing Officer clearly committed an error in proceeding to pass the impugned order on 12.05.2021, much prior to expiry of the extended period of time, which was due to expire on 31.05.2021. It is also relevant to state that on 18.05.2021, the petitioner has filed his objections to the draft Assessment Order before the DRP and the same is pending. Under these circumstances, I am of the considered opinion that the impugned Assessment Order passed by respondent No.1- Assessing Officer without awaiting directions from the DRP, before whom the matter was pending pursuant to the petitioner filing his objections within the prescribed period is clearly arbitrary, illegal and without jurisdiction or authority of law and the same deserves to be quashed and necessary directions are to be issued to the DRP as well as the Assessing Officer in this regard. 6. In the result, I pass the following: 5 ORDER (i) The petition is hereby allowed. (ii) The impugned final assessment order bearing No.ITBA/AST/S/143(3)/2021-22/ 1032896847(1) at Annexure-A dated 12.05.2021, computation sheet bearing No.ITBA/AST/S/216/2021-22/1032896874 (1) dated 12.05.2021 at Annexure-A1 and demand notice at Annexure-A2 bearing No. ITBA/AST/S/156/2021-22/ 1032896875(1) dated 12.05.2021 are hereby quashed. (iii) The Dispute Resolution Panel (DRP) is directed to conclude the proceedings by considering the objections filed by the petitioner, in accordance with law and Section 144C of the Income Tax Act, 1961. (iv) Upon the DRP concluding the proceedings as provided under Section 144C referred to supra, respondent No.1 – Assessing Officer shall proceed further and pass appropriate orders in accordance with law. SD/- JUDGE nms "