Monnappa Appaiah Bijjanda V. National Faceless Assessment Centre and The Income Tax Officer, Ward - Madikeri and The Principal Chief Commissioner of Income Tax, Karnataka and Goa

WP/8138/2023

AI Insights

In this writ petition, Monnappa Appaiah Bijjanda challenged the assessment order and related notices issued by the Income Tax Department for the assessment year 2015-16. The petitioner argued that the deposits in question, amounting to Rs.1,83,10,000, were made in a joint account with the Chief Executive Officer of Madapura PACS and were not personal funds. The court found merit in providing the petitioner another opportunity to present his case and gather necessary materials to respond to the show-cause notice.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 798532 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 28-06-2023
• 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: U A MADHUSUDHAN
• Keywords: Assessment Order; Deposit; Income Tax; Savings Bank account; Show cause notice
• Section: 147; 148; 144; 142(1); 144B; 226; 227

Judgement Text

" - 1 - NC: 2023:KHC:22373 WP No. 8138 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 28TH DAY OF JUNE, 2023 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 8138 OF 2023 (T-IT) BETWEEN: MONNAPPA APPAIAH BIJJANDA, SON OF SRI. B.M. APPAIAH, AGED ABOUT 60 YEARS, NO. 9, KADANDALU VILLAGE, KANDANKOLLY POST, SOMWARPET TALUK, KODAGU - 571 237. …PETITIONER (BY SRI. U A MADHUSUDHAN, ADVOCATE) AND: 1. NATIONAL FACELESS ASSESSMENT CENTRE, REPRESENTED BY ADDL/JOINT/ DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWARLAL NEHRU STADIUM, DELHI - 110 003. Digitally signed by SUCHITRA M J Location: High Court of Karnataka - 2 - NC: 2023:KHC:22373 WP No. 8138 of 2023 2. THE INCOME TAX OFFICER, WARD - MADIKERI, MADIKERI-SRIVALLI BUILDING, MADIKERI - 571 201. 3. THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, KARNATAKA AND GOA, CENTRAL REVENUE BUILDING, QUEEN'S ROAD, BANGALORE - 560 001. …RESPONDENTS (BY SRI. E I SANMATHI, ADVOCATE) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ASSESSMENT ORDER DATED 06.03.2023 PASSED U/S 147 R.W.S 144 R.W.S 144B OF THE ACT FOR THE ASSESSMENT YEAR 2015-16 BY THE R1 BEARING DIN NO. ITBA/AST/S/147/2022-23/1050458597(1) HEREIN MARKED AS ANNX-A1 AND ETC., THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: - 3 - NC: 2023:KHC:22373 WP No. 8138 of 2023 ORDER The petitioner has sought for setting aside of the Assessment Order dated 06.03.2023 passed under Section 147 read with Section 144 read with Section 144B of the Income Tax Act, 1961 (for short 'I.T.Act') for the Assessment Year - 2015-16 at Annexure-A1 and has challenged the computation sheet at Annexure-A2; Demand Notice at Annexure-A3 and Penalty Notice at Annexures-A4 and A5 and the Notice under Section 148 of the I.T.Act, at Annexure-B. 2. Learned counsel for the petitioner Sri. U.A.Madhusudhan would submit that as regards the time fixed for furnishing reply was 20.02.2023 and the petitioner had sought for adjournment till 19.03.2023 on 04.03.2023 on the ground that the petitioner was gathering material. It is submitted that the subject matter of the notice under Section 142(1) of the I.T.Act was with respect to the deposit of cash of Rs.1,83,10,000/- in the Savings Bank Account No.11032200004085 maintained with Madapur Branch of Syndicate Bank, which now stands merged with Canara Bank, which was opened by the petitioner and another person Sri. Kaverappa.B.S. It is further submitted that the petitioner - 4 - NC: 2023:KHC:22373 WP No. 8138 of 2023 was gathering information to make out reply to the said notice and that the deposits referred to above were that of the Madapura VSSSN (currently Madapura PACS - Madapura Primary Agricultural Cooperative Society Ltd.) which account was jointly operated by the President who is the petitioner herein and the Chief Executive Officer of VSSSN- Sri. Kaverappa.B.S. and does not pertain affairs of the petitioner in his personal capacity. 3. Learned counsel for the petitioner has relied on the certificate at Annexure-S as also the certificate of the VSSSN Bank at Annexure-T and submits that in support of Annexures- S and T, the petitioner was gathering information to be placed before the Assessing Officer and if the said information was placed and an opportunity given to the petitioner to make out reply to the show-cause notice dated 24.02.2023, the petitioner would have been in a position to convince the Assessing Officer to drop proposed addition. Taking note of the said contentions, it is a fit case to provide another opportunity to the petitioner to reply to the notice dated 24.02.2023. - 5 - NC: 2023:KHC:22373 WP No. 8138 of 2023 4. Accordingly, noticing that the addition relates to deposit found in the Account No.11032200004085 jointly operated by the petitioner-President and CEO. The case is made out for giving an opportunity to the petitioner in the course of assessment proceedings to make out the reply to the show-cause notice and put forth his explanation. 5. The materials at Annexures-S and T prima-facie would show that the petitioner is in the possession of some material which may have to be considered by the Assessing Officer. Accordingly, the Assessment order at Annexure-A1; Computation Sheet at Annexure-A2; Demand Notice at Annexure-A3 and Penalty Notice at Annexures - A4 and A5 are set aside and the matter is remanded to the stage post issuance of show-cause notice dated 24.02.2023. 6. The petitioner is at liberty to make out his reply to the aforesaid show-cause notice and place adequate material evidence and is also at liberty to request for an opportunity of personal hearing. The respondents to consider the same and pass orders in accordance with law. Accordingly, petition is disposed off. - 6 - NC: 2023:KHC:22373 WP No. 8138 of 2023 All contentions are kept open. Sd/- JUDGE SMJ List No.: 1 Sl No.: 32 "