Healthcare Global Enterprises Limited V. The Assessment Unit Income Tax Officer National Faceless Assessment Centre Income Tax Department and Deputy Commissioner of Income Tax Circle - 2 (2) (1) Bangalore

WP/1274/2023

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The case involves Healthcare Global Enterprises Limited, which filed a writ petition against the assessment order and related documents issued by the Income Tax Department. The petitioner contested the assessment order on the grounds of not being provided a complete opportunity to respond, particularly due to technical issues that prevented a scheduled personal hearing and the subsequent consideration of their emailed responses. The court found that the petitioner was not given a complete opportunity to present their case, which warranted the quashing of the assessment order and related documents.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 817215 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 03-03-2023
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: SANDEEP HUILGOL
• Keywords: Assessment Order; Faceless assessment; Personal hearing; Technical glitches; Email response
• Section: 143(3); 144B; 142

Judgement Text

" - 1 - WP No. 1274 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF MARCH, 2023 BEFORE THE HON'BLE MR JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 1274 OF 2023 (T-IT) BETWEEN: HEALTHCARE GLOBAL ENTERPRISES LIMITED A COMPANY INCORPORATED UNDER THE PROVISIONS OF THE COMPANIES ACT 1956 HCG TOWERS, NO 08 P KALINGA RAO ROAD SAMPANGIRAMANAGAR BENGALURU - 560026 REPRESENTED HEREIN BY ITS MANAGER - TAXATION MR B J RATHNARAJU. …PETITIONER (BY SRI. SANDEEP HUILGOL.,ADVOCATE) AND: 1. THE ASSESSMENT UNIT INCOME TAX OFFICER NATIONAL FACELESS ASSESSMENT CENTRE INCOME TAX DEPARTMENT 2ND FLOOR, JAWAHARLAL NEHRU STADIUM NEW DELHI - 110003. 2. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE - 2 (2) (1) BANGALORE BMTC BUILDING Digitally signed by NARASIMHA MURTHY VANAMALA Location: HIGH COURT OF KARNATAKA - 2 - WP No. 1274 of 2023 80 FEET ROAD,6TH BLOCK KORAMANGALA BANGALORE - 560095. …RESPONDENTS (BY SRI.E.I. SANMATHI., ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ASSESSEMENT ORDER DATED 29/11/2022 BEARING DIN NO. ITBA/AST/S/143(3)/2022-23/1048328513(1) PASSED BY THE 1ST RESPONDENT UNDER SECTION 143(3) READ WITH SECTION 144B OF THE INCOME TAX ACT, 1961, FOR ASSESSMENT YEAR 2021-22 (ANNEXURE-A- 1); QUASHING THE IMPUGNED COMPUTATION SHEET DATED 29/12/2022 BEARING DIN AND DOCUMENT NO. ITBA/ST/S/621/2022-23/1048328562(1) ISSUED BY THE 1ST RESPONDENT UNDER THE PROVISIONS OF THE INCOME-TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2021-22 (ANNEXURE-A-2) AND ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER The petitioner has called in question the assessment order dated 29.12.2022 [Annexure-A1] under Section 143(3) read with Section 144B of the Income Tax Act, 1961 [IT Act] and the consequential computation sheet/demand and notice [Annexures- - 3 - WP No. 1274 of 2023 A-2, A-3, and A-4]. The petitioner’s principal grievance in this petition is because of the alleged lack of due opportunity. Sri Sandeep Huilgol and Sri E.I.Sanmathi, the learned counsel for the petitioner and the respondents respectively are heard for final disposal given the short canvass. 2. Sri Sandeep Huilgol submits that the petitioner is issued with necessary notice under Section 142 and 143 of the IT Act and appropriate responses have also been filed. The petitioner is finally issued with the Show Cause Notice on 21.12.2022 along with the draft assessment order with opportunity to file response through its email account by 15.00 hours of 26.12.2022. The petitioner is also simultaneously served with the notice of personal hearing scheduled to be held on 22.12.2022, but the personal hearing could not be held either on 22.12.2022 or on the next date of - 4 - WP No. 1274 of 2023 hearing viz., 23.12.2022 because of certain technical glitches. 3. Sri Sandeep Huilgol further submits that the personal hearing was held on 26.12.2022, and during the course of the hearing certain queries were raised and the petitioner was specifically permitted to file certain additional clarifications/responses. The petitioner has sworn to an affidavit that the concerned officer permitted the petitioner to file and upload the responses/clarifications by the end of the day of 26.12.2022. The petitioner could not upload because the system was unresponsive but, ultimately the clarifications and the responses are sent by email on the same day. These have not been considered, and if the petitioner’s clarifications/responses are considered, the assessment order would not be justified. 4. Sri E.I.Sanmathi, the learned counsel for the respondents, does not contest the material - 5 - WP No. 1274 of 2023 assertion that the personal hearing which was scheduled to be held on 22.12.2022 was not held either on that day or on 23.12.2022 [the next day] and was held only on 26.12.2022. He also does not contest that the petitioner has sent clarifications/responses on email. Sri E.I. Sanmathi does not admit the affidavit, and he contends that during the course of the personal hearing on 26.12.2022, the petitioner is permitted to file responses/clarifications by the end of the day. 5. Be that as it may, it remains rather obvious and beyond dispute that the assessment order is passed without considering the petitioner’s responses sent on email and these responses are enclosed to this petition as Annexures-H1 and H2. In these circumstances, this Court must opine that the petitioner is able to demonstrate lack of complete opportunity, perhaps for reasons of inadvertence but lack of complete opportunity has resulted in failure to - 6 - WP No. 1274 of 2023 consider the petitioner’s responses/clarifications. The petitioner must succeed on this short ground. 6. Hence, the petition is allowed in part quashing the impugned assessment order [Annexure- A.1] and the consequential computation sheet/notice of demand [Annexures-A.2 to A.4], but with liberty to the first respondent to extend due opportunity to the petitioner to file responses/clarifications and re-file assessment. SD/- JUDGE nv "