Hassan Co-operative Society Limited No.1 and H B Shivakumar V. Income Tax Officer Ward 1 and TPS, Hassan and National Faceless Assessment Centre

WP/15319/2024

AI Insights

The case involves the Hassan Co-operative Society Limited, which challenged the validity of an order under Section 143(3) of the Income Tax Act, 1961, issued by the Income Tax Officer, Ward 1 and TPS, Hassan, and the National Faceless Assessment Centre. The petitioner argued that the show cause notice issued on 01.03.2024 did not provide adequate time for a response, violating the standard operating procedure that requires at least seven days for such replies. The court found merit in the petitioner's argument, leading to the setting aside of the initial order and penalty notices, and remitting the case back to the stage of the show cause notice.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 814430 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 26-06-2024
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961, Co-operative Societies Act 1956
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M THIRUMALESH
• Assessee Lawyers: RAVISHANKAR
• Keywords: Assessment; Income Tax; Penalty; Show cause notice; Violation of SOP
• Section: 143(3)

Judgement Text

" - 1 - NC: 2024:KHC:23520 WP No. 15319 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26TH DAY OF JUNE, 2024 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 15319 OF 2024 (T-IT) BETWEEN: HASSAN CO-OPERATIVE SOCIETY LIMITED NO.1, SOCIETY ROAD, GANDHI BAZAR, HASSAN-573201. PAN. AAAAH7251F. ALSO AT: H B SHIVAKUMAR, AGED 55 YEARS, S/O BASAPPA, VISHWESWARAYYA EXTENSION, NEAR YASH INTERNATIONAL ACADEMY, SALAGAME ROAD, HASSAN-573201, REGISTERED UNDER CO-OPERATIVE SOCIETIES ACT 1956. …PETITIONER (BY SRI. RAVI SHANKAR S. V., ADV.) AND: 1. INCOME TAX OFFICER WARD 1 AND TPS, HASSAN-573201. 2. NATIONAL FACELESS ASSESSMENT CENTRE ADDITIONAL/JOINT/DEPUTY/ ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI-110003. …RESPONDENTS (BY SRI.M THIRUMALESH, ADV.) Digitally signed by VIDYA G R Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:23520 WP No. 15319 of 2024 THIS PETITION IS FIELD UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA, PRAYING TO I) QUASH THE ORDER UNDER SECTION 143(3) OF THE ACT DATED 26/03/2024, BEARING DIN NO. ITBA/AST/S/143(3)/2023-24/1063422820 (1) ISSUED BY THE R2 FOR THE ASSESSMENT YEAR 2022-23 HEREIN MARKED AS ANNEXURE-A AND ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER The petitioner has called in question the validity of the order under Section 143(3) of the Income Tax Act, 1961 (for short, ‘IT Act’) and has also sought for setting aside of the penalty notice at Annexures-A1 and A2. 2. It is the case of the petitioner that during the assessment proceedings, show cause notice on variation was issued on 01.03.2024 with reply to be made on 05.03.2024. It is submitted that such short time afforded is in violation of the SOP that requires at least seven days time being afforded for reply to show cause notice. The said aspect regarding time to be afforded to reply to show cause notice is not in dispute. Learned counsel for the petitioner has contended that in light of insufficient time afforded, they were not in a position to make out a reply to counter the proposed variation and addition. - 3 - NC: 2024:KHC:23520 WP No. 15319 of 2024 3. Such submission of prejudice resulting due to the short time made available to the reply requires acceptance. Accordingly, the order at Annexure-A is set aside. Matter is remitted to the stage of reply to the show cause notice dated 01.03.2024. The penalty notice at Annexures-A1 and A2 are also set aside. 4. It is the contention of the petitioner that the time for making out reply to the show cause notice to which stage the matter now stands remitted ought to be extended for at least fifteen days in the peculiar facts of the case. In the light of bulky records that has been produced and explanation made, if such request is made, same to be considered by the Assessing Authority, appropriately. Accordingly, writ petition stands disposed off. Sd/- JUDGE NC CT:bms List No.: 1 Sl No.: 13 "