Mr. S. Jaganathan V. The Commissioner of Income Tax Bangalore-III and The Assistant Commissioner of Income Tax Central Circle III and The Income Tax Officer Company Ward 12(2)

WP/5911/2015

AI Insights

The case revolves around the petitioner, Mr. S. Jaganathan, who is the legal heir of the deceased A.S. Sengoda Gounder, contesting the recovery notices issued for the assessment year 1995-96. The petitioner sought to benefit from the KVS Scheme, claiming that a declaration made under the scheme should be accepted. However, the Commissioner of Income Tax rejected this claim, referencing a prior writ appeal (W.A. No. 996/2004) and a subsequent income tax appeal (ITA 1029/2006), where the revenue's success led to the revival of earlier assessment orders. The High Court's decision was influenced by the need to adhere to the finality of the ITA 1029/2006 judgment, which did not favor the petitioner's claims.

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 671469 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 05-08-2015
• Assessment Year: misc
• Other Referred Cases: WP.10603/1999, Writ Appeal 996/2004, ITA 1029/2006
• Laws Referred To: Articles 226 and 227 of the Constitution of India, Section 93 of the Kar Vivad Samadhan Scheme 1998, Section 92 of the Kar Vivad Samadhan Scheme 1998, Finance (No.2) Act, 1998
• Result in Favour of: Revenue
• Court: HIGH COURT
• Assessee Lawyers: BALRAM RAO
• Keywords: Assessment Year 1995-96; Income Tax; Kar Vivad Samadhan Scheme; Recovery notice; Writ petition
• Section: 92; 85; 226; 93; 227

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 5TH DAY OF AUGUST, 2015 BEFORE THE HON'BLE MR. JUSTICE RAM MOHAN REDDY WRIT PETITION NO. 5911 OF 2015 (T-IT) BETWEEN: MR.S.JAGANATHAN AGED ABOUT 59 YEARS LEGAL HEIR OF LATE A S SENGODA GOUNDER NO.6, BRIDGE ROAD, PALLIPALAYAM ERODE-638006. OUT OF STATE ... PETITIONER (By Sri. BALRAM R RAO, ADV.,) AND 1. THE COMMISSIONER OF INCOME TAX BANGALORE-III INCOME TAX DEPARTMENT FIRST FLOOR, C R BUILDING QUEENS ROAD, BANGALORE-560001. 2. THE ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE III INCOME TAX DEPARTMENT THIRD FLOOR, C R BUILDING QUEENS ROAD, BANGALORE-560001. 2 3. THE INCOME TAX OFFICER COMPANY WARD 12(2) IV FLOOR INCOME TAX DEPARTMENT NRUPATHUNGA ROAD BANGALORE-560001. ... RESPONDENTS THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO A] QUASH THE IMPUGNED RECOVERY NOTICE DATED 25.2.2013 AND 22.12.2014 PASSED BY THE R-3 VIDE ANN-T FOR THE ASSESSMENT YEAR 1995-96. B] RESTRAIN THE R-3 PROCEEDING FURTHER IN PURSUANCE OF THE IMPUGNED RECOVERY NOTICE DATED 25.2.2013 AND 22.12.2014 VIDE ANN-T FOR THE ASSESSMENT YEAR 1995-96. C] DIRECT THE R-1 TO GRANT THE CERTIFICATE IN TERMS OF SECTION 93 OF THE KAR VIVAD SAMADHAN SCHEME 1998 IN ACCEPTING THE FORM OF DECLARATION DATED 23.12.1998 FILED IN TERMS OF SECTION 92 OF THE KAR VIVAD SAMADHAN SCHEME 1998 ON BEHALF OF THE DECEASED ASSESSEE IN THE REGULAR ASSESSMENT PROCEEDINGS RELATING TO THE ASSESSMENT YEAR 1995-96 & ETC., THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING: 3 O R D E R The assessee named A.S.Sengoda Gounder, since deceased was represented by his son the petitioner, in a declaration dated 22.12.1988, under Section 85 of Finance (No.2) Act, 1998 (KVSS), in Form-1A for assessment year 1995-96. The question of entitlement of the assessee to claim benefit under Kar Vivad Samadhan Scheme, for short ‘KVS Scheme’, when rejected by order dated 19.2.1999 of the commissioner of Income Tax, was questioned in WP.10603/1999, which petition when rejected by order dated 8.1.2004, was considered, in Writ Appeal 996/2004, whence it was observed thus : “The above appeal is disposed of without answering the question of law by holding that the assessee/appellant would be entitled to claim the benefit accruing under the KVSS only in the event of ITA 1029/2006 pending before this Court is dismissed and reaches finality, in as much as the protective assessment orders passed on 31-3-1998 and demand raised thereunder would get revived. In such an 4 event the Designated Authority would consider the declarations filed by the appellants under Section 88 of the Finance Act dated 22-12-1998 Annexure ‘C’ and ‘H’ respectively in accordance with law subject to the assessees satisfying all other conditions under the Scheme. It is also made clear that, in the event the Revenue succeeds in the appeal i.e., ITA 1029/2006, the question of considering the declaration dated 22.12.1998 as per Annexure-‘C’ and ‘H’ would not arise. (emphasis supplied) 2. The miscellaneous petition to delete or modify the reference made to pending appeal i.e. ITA 1029/2006 in the Order dated 3.7.2009 in W.A.No.996/2004, was rejected by order dated 26.05.2011. 3. It appears ITA 1029/2006 filed by the revenue was allowed by order dated 31.3.2010 whereunder, the order of the tribunal was set-aside and the proceeding remitted to the assessing officer keeping all contentions open over substantial question of law No.3, which reads thus:- 5 “Whether the Tribunal failed to recorded a finding as to whether the conclusion drawn by the first Appellate Authority that after a return is filed if the search is conducted the income declared by the assessee in the return cannot be brought to tax under the regular assessment but should be brought to tax under Chapter XIV-B block assessments of the Act”. Therefore it is for the Assessing officer to decide the case afresh. 4. Petitioner filed W.P.No.31503/2013, whence, a learned single Judge by order dated 13.8.2014 recording the submission of learned counsel for revenue that the order dated 3.7.2009, in W.A. 996/2004, would be complied within eight weeks, petition was disposed of. 5. In compliance with the said order, the Commissioner of Income Tax-III Bangalore, having regard to the specific finding in W.A.No.996/2004, more 6 appropriately, that in the event, the revenue succeeds in ITA 1029/2006, there was no question of considering the declaration dated 22.12.1998 of late A.S.Sengoda Gounder, represented by the petitioner, accordingly, by order dated 29.09.2014, Annexure-V, rejected, the claim for benefit under the ‘KVS Scheme’. 6. The submission of the learned counsel for the petitioner that ITA 1029/2006 was in respect of assessment of the return filed by S. Jagannathan in his individual capacity and not as a legal representative of deceased A.S. Sengoda Gounder, is noticed to be rejected, since that plea ought to be advanced in WA 996/2004. Moreover the very same plea when advanced before the Commissioner of Income Tax, that authority had no jurisdiction to interfere with the Order in WA 996/2004. 7 7. In the circumstances, no exception can be taken to the finding and conclusion arrived at by the Commissioner of Income Tax in the order impugned calling for interference. 8. Sequentially, the reliefs to quash the recovery notice Annexure-T for the assessment year 1995-96 as also for a writ of prohibition to prohibit the 3rd respondent from proceeding further in pursuance of recovery notice Annexure-T and a writ of mandamus to the 1st respondent to grant a certificate in terms of Section 93 of ‘KVS Scheme’ by accepting the declaration dated 22.12.1998 of late A.S.Senagoda Gounder are unavailable to the petitioner. Petition rejected. Sd/- JUDGE Ia "