M/S MABA CORPORATE SERVICES PVT LTD V. THE DEPUTY COMMISSIONER OF INCOME TAX

WP/13023/2022

AI Insights

The case involves M/S MABA Corporate Services Pvt. Ltd., which filed a writ petition against various income tax authorities, seeking directions for the adjudication of appeals for the assessment years 2007-08 to 2012-13. The appeals were previously remanded back by the Income Tax Appellate Tribunal due to issues concerning the recording of satisfaction notes as per Section 153C of the IT Act. The petitioner also sought to quash the assessment orders dated 30.3.2015, claiming they were without jurisdiction as the satisfaction notes were not recorded by the appropriate assessing officer. The court heard arguments from both sides and decided to dispose of the petition, allowing the petitioner to take further steps to expedite the process and recover impounded documents.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 760681 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 29-03-2023
• Assessment Year: misc
• Laws Referred To: Constitution of India, Income Tax Act
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: ARAVIND CHAVAN
• Keywords: Assessment years; Impounded documents; Income Tax; Jurisdiction; Satisfaction note; Writ petition
• Section: 153C; 132A; 226; 227

Judgement Text

"- 1 - WP No. 13023 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF MARCH, 2023 BEFORE THE HON'BLE MR JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 13023 OF 2022 (T-RES) BETWEEN: M/S MABA CORPORATE SERVICES PVT. LTD., NO.186/1, J. C. COMPLEX ANNEXE, SIRUR PARK ROAD, SESHADRIPURAM, BANGALORE - 560 020. REP. BY ITS MANAGING DIRECTOR, SRI. C. M. NARAYANA REGISTERED COMPANY REGISTERED UNDER COMPANIES ACT, 1956. …PETITIONER (BY SRI. ARAVIND V. CHAVAN, ADVOCATE) AND: 1. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE -2(3), C. R. BUILDING, QUEENS ROAD, BENGALURU - 560 001. 2. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, C. R. BUILDING, QUEENS ROAD, BENGALURU - 560 001. 3. INCOME TAX OFFICER, WARD -4(1) (3), BMTC BUILDING, 80 FEET ROAD, Digitally signed by NARASIMHA MURTHY VANAMALA Location: HIGH COURT OF KARNATAKA - 2 - WP No. 13023 of 2022 KORAMANGALA, BENGALURU - 560 095. 4. PRINCIPAL COMMISSIONER OF INCOME TAX-4 BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU -560 095. 5. COMMISSIONER OF INCOME TAX (APPEALS)-11 C. R. BUILDING, QUEENS ROAD, BANGALORE -560 001. …RESPONDENTS (BY SRI. E. I. SANMATHI, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE FIFTH RESPONDENT TO CONSIDER THE APPEAL FOR ASSESSMENT YEARS 2007-08 TO 2012-13 AND ADJUDICATE THE SAME WHICH HAS BEEN REMANDED BACK BY THE INCOME TAX APPELLATE TRIBUNAL UNDER ORDER DATED 12.05.2017 IN ITA.NOS. 1755 TO 1761/BANG/2016 ANNEXURE-G; TO QUASH THE ASSESSMENT ORDERS FOR THE ASSESSMENT YEARS 2007-08 TO 2012-13 ALL DATED 30.3.2015 ANNEXURE - C1, C2, C3, C4, C5 AND C6 PASSED BY THE FIRST RESPONDENT AS BEING WITHOUT JURISDICTION FOR NOT RECORDING OF SATISFACTION NOTE BY TRANSFEREE ASSESSING OFFICER AS PER SECTION 153C OF THE IT ACT; TO DIRECT THE FIRST RESPONDENT TO RETURN ALL THE - 3 - WP No. 13023 of 2022 IMPOUNDED DOCUMENTS IN THE SURVEY CONDUCTED ON 05.02.2013 U/S 132A OF THE IT ACT. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN \"B\" GROUP, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER The petitioner has filed this petition for direction to the fifth respondent to consider the appeal for Assessment Years 2007-08 to 2012-13 and adjudicate the same which has been remanded back by the Income Tax Appellate Tribunal under the order dated 12.05.2017 in ITA. Nos. 1755 to 1761/Bang/2016 [Annexure-G]. 2. The petitioner as an alternative relief, seeks quashing the first respondent’s assessment orders for the Assessment Years 2007-08 to 2012-13 all dated 30.3.2015 [Annexure - C1, C2, C3, C4, C5 and C6] on the ground that the first respondent [the transferee Assessing Officer] has not recorded the satisfaction note as per Section 153C of the IT Act - 4 - WP No. 13023 of 2022 with consequential requests. Sri. Aravind V Chavan, the learned counsel for the petitioner, and Sri. E I Sanmathi, the learned standing counsel for the respondents, are heard for final disposal. 3. It is undisputed that the petitioner's appeals before the Income Tax Appellate Tribunal in ITA Nos.1755-61/Bang/2016 are disposed of by Order dated 12.05.2017 restoring the proceedings to the concerned Commissioner of Income Tax [Appeals] [the fifth respondent] for a decision after verifying the relevant records and affording adequate opportunity. The restoration of the proceedings is in the light of the following reasons: \"4. We have considered the rival submissions. Regarding the first six assessment year i.e. A. Ys. 2007-08 to 2012 13, ITA Nos. 1755 to 1760(Bang) 2016, the first grievance of the assessee is about validity of the proceedings u/s 153C. This issue is raised by the assessee before the tribunal for the first and it was not raised before CIT (A). From the copy of the satisfaction note, it appears prima facie - 5 - WP No. 13023 of 2022 that it was not recorded by the A.O. of the searched person and it seems that it is recorded by the A. O. of the assessee because notice was issued on the same date on which the satisfaction was recorded. But this is not clear as to whether the A.O. of the assessee and the searched person was same or different. One more aspect has to been that even if the A. O. of the searched person and the assessee is same, whether the satisfaction was recorded by the A. O. in his capacity of the A. O. of the searched person or in his capacity of the A. O. of the assessee. If the A. O. is same, than there is a possibility that the recording of satisfaction by the A. O. in his capacity of A. O. of the searched person and issue of notice u/s 153C in his capacity of the A. O. of the assessee on same date is possible. Hence, we feel it proper to restore this matter to the file of CIT (A) in these sis years for a decision after verifying the relevant records and after providing adequate opportunity of being heard to both sides. If the assessee succeeds on this aspect, than no decision is required on merit of the addition but if the assessee fails on this aspect than the CIT (A) should decide the issue on merit afresh because the issue on merit should be decided after decision on legal aspect.\" - 6 - WP No. 13023 of 2022 4. The petitioner's grievance is that notwithstanding the aforesaid disposal five years back, the fifth respondent has not disposed of the appeals and in fact, it is contended that even notice is not issued. However, it remains undisputed that if the fifth respondent could take up the appeal for disposal, the ground that the transferee Assessing Officer has not recorded the satisfaction note as per Section 153C of the IT Act could be considered. 5. In fact, Sri E I Sanmathi submits that if a certified copy of this order is filed with the fifth respondent, notice of hearing shall be issued at the earliest and insofar as the pendency of the proceedings on restoration, Sri. E I Sanmathi submits the same could be for bonafide reasons. On the petitioner's request for return of the documents impounded in the survey proceedings, Sri E I Sanmathi submits that if another application is submitted with the jurisdictional Commissioner, the - 7 - WP No. 13023 of 2022 same will be considered. In the light of the above, the following: ORDER The petition stands disposed of reserving liberty to the petitioner to file a certified copy of this order with the fifth respondent calling upon the fifth respondent to issue notice of hearing within four [4] weeks from the date of receipt of a certified copy of this order. The petitioner is also reserved liberty to file appropriate application with the jurisdictional Commissioner for release of the impounded documents. Sd/- JUDGE AN/- "