MRS.LALITHA W/O GIRISH HATTARKI V. THE DY.DIRECTOR OF INCOME TAX (INVESTIGATIONS)

WP/110664/2019

AI Insights

The case involves Mrs. Lalitha, a partner in the firm M/s.Veerabhadrappa Sangappa and Co. (VESCO), who filed a writ petition against the Deputy Director of Income Tax (Investigations) seeking a mandamus to consider her representation regarding the non-provision of information and documents related to the firm's income tax returns post-2014. The petitioner contended that despite her 9% share in the firm's profits and a monthly remuneration, she was excluded from the firm's operations and denied access to essential financial documents after 2014. Following a search by the Income Tax Department in 2018 and her cooperation during the proceedings, she requested the necessary documents from the department, which were not provided, leading to her filing this writ petition.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 756500 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 26-09-2024
• Assessment Year: misc
• Laws Referred To: Articles 226 and 227 of the Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: Y V RAVIRAJ
• Assessee Lawyers: SANGRAM KULKARNI
• Keywords: Income Tax; Income Tax Returns; Mandamus; Manganese Ore; Mining leases; Partnership firm; Search proceedings; Writ petition
• Section: 131

Judgement Text

" - 1 - NC: 2024:KHC-D:14068 WP No. 110664 of 2019 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 26TH DAY OF SEPTEMBER, 2024 BEFORE THE HON'BLE MS. JUSTICE JYOTI MULIMANI WRIT PETITION NO. 110664 OF 2019 (T-IT) BETWEEN: MRS. LALITHA W/O GIRISH HATTARKI, AGE: 47 YEARS, OCC: BUSINESS, R/O: PLOT NO.10898, 1ST MAIN, 5TH CROSS, BEHIND SAIT PETROL PUMP, SADASHIV NAGAR, BELAGAVI. …PETITIONER (BY SRI. SANGRAM.S.KULKARNI., ADVOCATE) AND: THE DY. DIRECTOR OF INCOME TAX (INVESTIGATIONS), 2ND FLOOR, SURESH COMPLEX, SANJAY GANDHI NAGAR, BALLARI-583 101. …RESPONDENT (BY SRI. Y.V.RAVIRAJ., ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, SEEKING CERTAIN RELIEFS. THIS WRIT PETITION IS LISTED FOR HEARING- INTERLOCUTORY APPLICATION, THIS DAY, AN ORDER IS MADE AS UNDER: Digitally signed by THEJASKUMAR N Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC-D:14068 WP No. 110664 of 2019 ORAL ORDER Sri.Sangram S.Kulkarni., counsel for the petitioner and Sri.Y.V.Raviraj., counsel for the respondent have appeared in person. 2. The Writ Petition averments are stated as under: Mrs.Lalitha – the Petitioner is a partner of M/s.Veerabhadrappa Sangappa and Co., also known as VESCO. The firm is carrying on the business at Sandur, Bellary and having its office at Bellary. It is stated that the partnership firm was incorporated in the year 1970 and started its business of acquiring mining leases and contracts for sale and purchase of manganese ore or any other minerals from persons or Corporations. The partnership firm was reconstituted from time to time and new partners were added and so also some of the partners had retired. The deed of partnership was registered in the year 1992 wherein the firm had three partners namely K.S.Veerabhadrappa, Annapoornamma and K.S.Ratnamma. In the year 1995, the firm was reconstituted and sons and daughters of Veerabhadrappa were added as partners of the firm. The reconstituted partnership deed was also - 3 - NC: 2024:KHC-D:14068 WP No. 110664 of 2019 registered, wherein the profit and loss sharing ratio of each of the partners was mentioned. As per the partnership deed of the year 1995, the petitioner had 7% share in the profit and loss of the firm. In the year 2008, the partnership firm was reconstituted after the death of K.S.Veerabhadrappa. As per the registered reconstituted partnership deed dated 10.01.2008, the petitioner was entitled for 9% share in the profit and loss of the firm and so also entitled for a monthly remuneration of Rs.2,00,000/- (Rupees Two Lakh only). After the execution of partnership deed dated 10.01.2008, the activities of the firm were carried on by the brothers of the petitioner who were permanently residing at Sandur. It is said that the petitioner got married in the year 1996 and is permanently residing at Belagavi and therefore she could not participate in the day-to-day activities, management and business of the firm. Till the year 2014, the other partners of the firm had provided to the petitioner the information relating to the activities carried on by the firm and had also obtained - 4 - NC: 2024:KHC-D:14068 WP No. 110664 of 2019 her signature in the income tax returns till financial year 2014- 15. In the year 2014, the petitioner requested the managing partner of the firm Sri.K.S.Nagaraj to give the details regarding capital account of the petitioner, but the same was declined. After 2014, the partners of the firm have not provided any information to the petitioner relating to the business of the firm nor they gave copies of the books of accounts, balance sheet, profit and loss account and so also have not obtained the petitioner’s signature on the income tax returns filed on behalf of the firm. The income tax returns filed before the income tax department subsequent to the financial year 2014-15 do not bear the signature of the petitioner and the same are filed without the consent, knowledge and information of the petitioner. As the matter stood thus, in the year 2018, the income tax department conducted a search in the premises of the firm and so also the residence of the petitioner where she stayed with her husband. At the time of search proceedings, the petitioner fully cooperated with the department officials and - 5 - NC: 2024:KHC-D:14068 WP No. 110664 of 2019 had revealed the information which was readily available with her. In continuation of the search proceedings, the petitioner was also called upon to file her written statement before the department. The petitioner filed her written statement on 27.12.2018. However, the department issued summons under Section 131 of the Act and called upon her to appear personally before the respondent or through her authorized representative and give her statement. As per the summons issued by the department, the petitioner personally appeared before the respondent on 13.05.2019. The petitioner specifically contends that she received a life threat and hence she was compelled to lodge an oral complaint to the jurisdictional police station on 13.05.2019. The petitioner’s contention is that the department has called upon her to produce statement of account and other documents relating to the firm and she is unable to comply with the same as the said documents are not with her. Hence, she submitted a letter on 16.05.2019 and requested the respondent to provide the copies of income tax returns filed on behalf of - 6 - NC: 2024:KHC-D:14068 WP No. 110664 of 2019 the firm along with statement of account and other schedules and also copies of the audit report filed along with returns. The grievance of the petitioner is that the department has not considered her representation to enable her to respond to the department’s action. Hence, she has filed the captioned Writ Petition seeking Mandamus to consider her representation dated 16.05.2019. 3. Heard the contentions and perused the Writ papers with care. 4. A perusal of the Writ papers reveals that the Department has not suitably replied to the letter which has been addressed by the petitioner. Hence, this Court considers it proper to direct the Deputy Director of Income Tax (Investigation)/ jurisdictional officer to consider the letter and suitably reply to the same. Liberty is given to the petitioner to file a fresh representation along with documents within four weeks from the receipt of the certified copy of this order. If such a representation is submitted, the department/ jurisdictional officer shall consider Annexure-E and also the fresh - 7 - NC: 2024:KHC-D:14068 WP No. 110664 of 2019 representation that would be submitted by the petitioner in accordance with the law, within eight weeks thereafter. It is made clear that the department shall not precipitate the matter till the consideration of the letter/ representation of the petitioner. This Court has not expressed any opinion on the merits of the case. 5. Resultantly, the Writ Petition is disposed of. Sd/- (JYOTI MULIMANI) JUDGE TKN LIST NO.: 2 SL NO.: 11.1 "