M/S. MANGALORE CHEMICALS AND FERTILIZERS LTD., V. THE PRINCIPAL COMMISSIONER OF INCOME TAX

WP/1767/2019

AI Insights

The case involves M/s. Mangalore Chemicals and Fertilizers Ltd., represented by its managing director, who filed a writ petition against the Principal Commissioner of Income Tax, challenging an order that denied their request for a waiver of interest under Section 220(2A) of the Income Tax Act, 1961, for the assessment year 2008-09. The petitioner argued that the interest payment would cause genuine hardship and that the default was due to circumstances beyond their control, including delays on the part of the respondent. The High Court found that the respondent's order was cryptic and did not provide a reasonable opportunity for the petitioner to present their case, thus violating principles of natural justice.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 758414 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 12-08-2022
• 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: C P RAMASWAMI
• Keywords: Certiorari; Certiorari; Cryptic order; Natural Justice; Reconsideration; Waiver of interest
• Section: 220(2A)

Judgement Text

"1 IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 12TH DAY OF AUGUST, 2022 BEFORE THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR WRIT PETITION No.1767 OF 2019 (T-IT) BETWEEN: M/S. MANGALORE CHEMICALS AND FERTILIZERS LTD., UB TOWERS, LEVEL II, UB CITY, 24 VITTAL MALLYA ROAD, BENGALURU – 560 001. REPRESENTED BY ITS MANAGING DIRECTOR MR. N. SURESH KRISHNAN AGED 54 YEARS. …PETITIONER (BY SRI.DR.C.P. RAMASWAMI., ADVOCATE FOR SRI. BALARAM RAO., ADVOCATE) AND: THE PRINCIPAL COMMISSIONER OF INCOME TAX BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, KORAMANGALA BENGALURU – 560 095. …RESPONDENT (BY SRI. E.I. SANMATHI., ADVOCATE) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH AS FAR AS THE PETITIONER IS CONCERNED BY AN APPROPRIATE WRIT OR ORDER IN THE NATURE OF CERTIORARI OR OTHERWISE, THE IMPUGNED ORDER PASSED U/S. 220(2A) OF THE INCOME TAX ACT, 1961 DATED 13.06.2018 VIDE ANNEXURE.A AND ETC. THIS W.P. COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING:- 2 ORDER In this petition, petitioner seeks quashing of the impugned order at Annexure-A dated 13.06.2018 passed by the respondent, whereby the petition filed by the petitioner seeking waiver of interest under Section 220(2A) of the Income Tax Act, 1961 (for short ‘the I.T.Act’), for the assessment year 2008-09 was rejected by the respondent. 2. Heard learned counsel for the petitioner and learned counsel for the respondent and perused the material on record. 3. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner invites my attention to the sequence of events including the proceedings before the respondent in order to contend that on 08.01.2018, petitioner submitted the aforesaid petition for waiver of interest by enclosing all relevant documents and pointed out that payment of interest would cause genuine hardship to the petitioner and that the same deserves to be waived. It is submitted that alternatively, petitioner contended that 3 the default in payment of the amount, on which, the interest was payable was due to circumstances beyond the control of the petitioner – assessee and that on this ground also, the interest payable by the petitioner deserves to be waived. It was further submitted that the interest payable by the petitioner was on account of the delay on the part of the respondent and the same was not attributable to the petitioner and the impugned order passed by the respondent refusing to waive the interest deserves to be quashed on this score also. Lastly, it is submitted that the impugned order passed by the respondent is cryptic, laconic, unreasoned and non-speaking order and the same being contrary to the provisions contained in Section 220(2A) of the I.T.Act apart from being vitiated on account of not providing sufficient or reasonable opportunity to the petitioner to put forth his claim and hearing him and consequently, the impugned order is violative of principles of natural justice and the same deserves to be quashed. 4. Per contra, learned counsel for the respondent, in addition to reiterating the various contentions urged in the 4 statement of objections submit that there is no merit in the petition and the same is liable to be dismissed. 5. I have given my anxious consideration to the rival submissions and perused the material on record. 6. Though several contentions have been urged by both sides in support of their respective claims, a perusal of the impugned order will clearly indicate that the respondent has not correctly or properly considered the claim of the petitioner for waiver of interest under Section 220(2A) of the I.T.Act in the light of the requirements / ingredients contained in the said provision. Further, the various contentions urged by the petitioner in support of its claim for waiver of interest including the contentions urged in the present petition have not been considered in their proper perspective by the respondent while passing the impugned order. So also, in view of the specific assertion on the part of the petitioner that he requires one more opportunity to put forth its claim for waiver, without expressing any opinion on the merits / demerits of the rival contentions, I deem it just and appropriate to set aside the impugned order and 5 remit the matter back to the respondent for reconsideration afresh in accordance with law. 7. In the result, I pass the following:- ORDER (i) Petition is hereby allowed. (ii) The impugned order dated 13.06.2018 at Annexure-A passed by the respondent is hereby quashed. (iii) The matter is remitted back to the respondent for reconsideration afresh in accordance with law. (iv) All rival contentions are kept open and no opinion is expressed on the same. (v) Liberty is reserved in favour of the petitioner to submit and produce additional pleadings, documents, judgments etc., before the respondent, who shall consider the same and pass appropriate orders in accordance with law. Sd/- JUDGE Srl. "