DEVADARSHINI INFO TECHNOLOGIES V. UNION OF INDIA

WP/16707/2016

AI Insights

The case involves Devadarshini Info Technologies Private Limited challenging a show cause notice issued by the Deputy Commissioner of Income-tax, International Taxation, Circle-1(1), Bengaluru, under Section 133(6) of the Income Tax Act, 1961. The petitioner argued that the notice was without jurisdiction and sought to quash it. The primary contention was that the capital gain in question for the Financial Year 2014-15 should not be taxed, referencing a notification from the Ministry of Finance dated 01.11.2013. The court, however, decided not to interfere at this stage, given that the matter was still pending before the assessing authority and directed the authority to consider the objections and pass a speaking order within two months.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 722321 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 21-11-2017
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: K P KUMAR
• Keywords: Capital Gain; Income Tax; Jurisdiction; Notification; Null and void; Show cause notice
• Section: 133(6); 201(1); 201(1A)

Judgement Text

" 1/4 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF NOVEMBER, 2017 BEFORE THE HON’BLE Dr.JUSTICE VINEET KOTHARI W.P.No.16707/2016 (T-IT) BETWEEN DEVADARSHINI INFO TECHNOLOGIES PRIVATE LIMITED 23/2, 6TH FLOOR, VITTAL MALYA ROAD BENGALURU-560 001 REPRESENTED HEREIN BY ITS DIRECTOR Mr. DEEKSHITH K.M. ...PETITIONER (BY Mr. K.P. KUMAR, SENIOR COUNSEL FOR Mr. T. SURYANARAYANA, ADVOCATE) AND 1. UNION OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE REP. BY ITS SECRETARY ROOM No.46, NORTH BLOCK NEW DELHI – 110 001. 2. CENTRAL BOARD OF DIRECT TAXES REP. BY ITS CHAIRMAN NORTH BLOCK, NEW DELHI-110 001. 3. THE DEPUTY COMMISSIONER OF INCOME-TAX INTERNATIONAL TAXATION, CIRCLE-1(1) ROOM No.441, 4TH FLOOR BMTC BUILDING, 80 FEET ROAD KORAMANGALA, BENGALURU-560 095. ...RESPONDENTS (BY Mr. K.V. ARAVIND, ADVOCATE) Date of order 21-11-2017 W.P.No.16707/2016 Devadarshini Info Technologies Private Limited Vs. Union of India & others. 2/4 THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE SHOW CAUSE NOTICE ISSUED BY R-3 AND OR THEIR SUBORDINATES PURSUANT TO THE DATED 27-01-2016 AT ANNEX-N AS WITHOUT JURISDICTION AND THEREFORE NULL, VOID AND NON EST IN LAW & ETC., THIS PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER Mr. K.P. Kumar, Senior Counsel for Mr. T. Suryanarayana, Adv. for Petitioner. Mr. K.V. Aravind, Advocate for Respondents. The present petition has been filed by the petitioner- assessee challenging the impugned notice Annexure-N dated 27.01.2016 issued by the 3rd Respondent-Deputy Commissioner of Income-tax, International Taxation, Circle-1(1), Bengaluru, under Section 133(6) of the Income Tax Act, 1961 (Act) and further proceedings undertaken under Sections 201(1) and 201(1A) of the Act for the Financial Year 2014-15. 2. Learned counsel for the petitioner-assessee submitted that despite detailed objections filed before the said Authority, the said Authority has failed to decide the Date of order 21-11-2017 W.P.No.16707/2016 Devadarshini Info Technologies Private Limited Vs. Union of India & others. 3/4 objections. He also sought to submit on merits of the case that the Capital Gain in question could not be taxed in view of the Notification issued by the Ministry of Finance vide Annexure-Q dated 01.11.2013 and other relevant Notifications. 3. Since the proceedings are admittedly pending before the Assessing Authority, this Court is not inclined in its extraordinary jurisdiction to interfere and decide the issues prematurely and it is for the 3rd Respondent-Deputy Commissioner of Income-tax, International Taxation, Circle-1(1), Bengaluru, to decide all the objections of the petitioner by a speaking order after providing a reasonable opportunity of hearing to the petitioner. 4. The petitioner is free to file fresh representation besides the objections already filed by it along with relevant Notifications before the said Authority and the petitioner-assessee may appear before the concerned authority in the first instance on 14.12.2017. The said authority is given a period of two months time Date of order 21-11-2017 W.P.No.16707/2016 Devadarshini Info Technologies Private Limited Vs. Union of India & others. 4/4 thereafter to pass the appropriate speaking orders in the matter. With the above observations and directions, the petition is accordingly disposed of. No costs. Copy of this order be sent to the Respondents forthwith. Sd/- JUDGE TL "