MR. GUTHARAMAMOHANARAO KRISHNAKISHOR V. PRINCIPAL COMMISSIONER OF INCOME TAX

WP/13359/2023

AI Insights

The case involves Mr. Gutharamamohanarao Krishnakishor, the petitioner, who challenged several orders and notices issued by the Income Tax Department concerning the assessment year 2016-17. The petitioner argued that the assessment order was based on incorrect communication to a wrong email ID and that he was not given a fair opportunity to present his case. The main contention was regarding the addition of Rs. 22,50,000 to his income, which he claimed was agricultural income entitled to exemption under Section 10(37) of the Income Tax Act. The respondents defended the correctness of their findings, but acknowledged the issue of natural justice as a matter for the court's consideration.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 760634 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 27-07-2023
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: SUSHAL TIWARI
• Assessee Lawyers: SYED KHAMRUDDIN
• Keywords: Agricultural income; Assessment Order; Exemption; Notice of demand; Violation of natural justice
• Section: 142(1); 264; 10(37)

Judgement Text

" - 1 - NC: 2023:KHC:26421 WP No. 13359 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27TH DAY OF JULY, 2023 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 13359 OF 2023 (T-IT) BETWEEN: 1. MR. GUTHARAMAMOHANARAO KRISHNAKISHOR S/O MR. GUTHARAMA MOHANARAO, AGED ABOUT 56 YEARS, RESIDING AT NO.642, HARAGADDE, JIGANI, ANEKAL TALUK BENGALURU RURAL-560 105 … PETITIONER (BY SRI. SYED KHAMRUDDIN., ADVOCATE) AND: 1. PRINCIPAL COMMISSIONER OF INCOME TAX BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU-560 095 2. THE INCOME TAX OFFICER WARD 4(3)(5) BANGALORE, BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, Digitally signed by VIJAYA P Location: High Court of Karnataka - 2 - NC: 2023:KHC:26421 WP No. 13359 of 2023 NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU-560 095 … RESPONDENTS (BY SRI. SUSHAL TIWARI., ADVOCATE) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE IMPUGNED ASSESSMENT ORDER BEARING NO. ITBA/AST/S/144/2018-19/1014252339(1) DTD 13/12/2018 (ANNEXURE-A) PASSED BY THE R-2 AND NOTICE OF DEMAND DTD 13/12/2018 PASSED BY THE R-2 AND FURTHER, FOR THE ASSESSMENT YEAR 2016-17 BEARING NO. ITBA/AST/S/156/2018-19/1014252375(1) (ANNEXURE-A1) AND ETC. THIS W.P. COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER The petitioner has sought for setting aside of the assessment order at Annexure-A dated 13.12.2018, consequent notice of demand at Annexure-A1, order dated 25.06.2019 at Annexure-B, consequent notice of demand at Annexure-B1, order dated 08.03.2022 passed under Section 264 of the Income Tax Act, 1961 (for short 'the Act') at Annexure-C, rectification order dated 22.12.2022 at Annexure-D and notice of demand dated 22.12.2022 at Annexure-D1 passed by the respondent No.2. - 3 - NC: 2023:KHC:26421 WP No. 13359 of 2023 2. Learned counsel appearing for the petitioner would submit that the notice is issued preceding the assessment order and has been issued to a wrong email-ID, that communications were sent to the email-ID of the Consultant, who has not kept the petitioner intimated. Accordingly, it is submitted that the Authority while passing the assessment order has treated the petitioner as disentitled for exemption under Section 10(37) of the Act and added Rs.22,50,000/- to the returned income for the year 2016-17. Learned counsel for the petitioner further submits that if an opportunity is granted, they would be in a position to substantiate that the addition of Rs.22,50,000/- is in fact agricultural income. It is further submitted that the findings by the Revisional Authority under Section 264 of the Act, are also required to be interfered with while taking a broader look at the matter and affording a fresh opportunity to the petitioner to substantiate his case in light of the benefit conferred by way of exemption under Section 10(37) of the Act. 3. Learned counsel appearing for the respondents would point out that the Revisional Authority has recorded correct findings and no case as such is made out for interference. But - 4 - NC: 2023:KHC:26421 WP No. 13359 of 2023 however, he submits that the aspect of the violation of the principles of natural justice is a matter left for a Court to be considered appropriately. 4. Noticing the contention of the petitioner and also that if he was to be given an opportunity, the assertion that he would be able to demonstrate that Rs.22,50,000/- added as additional income ought to have been left out and hence, entitled for exemption under Section 10(37) of the Act is a matter that is to be taken note of, and an opportunity may be granted for the petitioner to file his reply to the notice dated 08.11.2019 under Section 142(1) of the Act. 5. It is noticed that the Bank Account of the petitioner SB A/c No.656902010004359 and Gold Loan A/c No.654/2282 at UNION BANK OF INDIA has been frozen (Annexure-N). In light of the petition being allowed, freezing of Bank Account as a consequential relief would stand lifted and accordingly, the Bank Authorities to take note of the same. 6. Accordingly, the assessment order at Annexure-A dated 13.12.2018, consequent notice of demand at Annexure-A1, order dated 25.06.2019 at Annexure-B, - 5 - NC: 2023:KHC:26421 WP No. 13359 of 2023 consequent notice of demand at Annexure-B1, order dated 08.03.2022 at Annexure-C, rectification order dated 22.12.2022 at Annexure-D and notice of demand dated 22.12.2022 at Annexure-D1 passed by the respondent No.2 are set aside, the petitioner to deposit 10% of the demand to demonstrate his bonafides, which is to be made within a period of four weeks from the date of defreezing of the Bank Account. 7. Accordingly, petition is disposed off. All contentions are kept open. Sd/- JUDGE NP "