MSOURCE (INDIA) PRIVATE LIMITED V. ASSISTANT COMMISIONER OF INCOME TAX

WP/22411/2024

AI Insights

The case involves MSOURCE (India) Private Limited, which filed a writ petition against the Assistant Commissioner of Income Tax and the Commissioner of Income Tax (Appeals) challenging an appellate order that confirmed a penalty imposed by the tax authority for the assessment year 2016-17. The petitioner argued that the appellate authority did not consider their submissions nor provided a personal hearing, leading to a decision that lacked reasoning and violated principles of natural justice. The respondents contended that the petition was not maintainable as the petitioner had an alternative remedy by way of an appeal against the impugned order. However, the court found merit in the petitioner's arguments regarding the violation of natural justice and set aside the impugned order, remitting the case back for a fresh decision.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 764138 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 18-09-2024
• Assessment Year: misc
• Laws Referred To: Constitution of India, IT Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: SUSHAL TIWARI
• Assessee Lawyers: PAI DHUNGAT ANKUR DEEPAK
• Keywords: Appellate order; Income Tax; Natural Justice; Penalty order; Writ petition
• Section: 250; 226; 227

Judgement Text

" - 1 - NC: 2024:KHC:38195 WP No. 22411 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF SEPTEMBER, 2024 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 22411 OF 2024 (T-IT) BETWEEN: 1. MSOURCE (INDIA) PRIVATE LIMITED BAGMANE WORLD TECHNOLOGY CENTRE DODANEKUNDI OUTER RING ROAD, DODDANEKKUNDI B O BENGALURU NORTH BENGALURU - 560 037 PAN NO AACCM 2097G A PRIVATE LIMITED COMPANY INCORPORATED UNDER THE COMPANIES ACT 1956 REPRESENTED BY MR ARJIT GANGULY S/O AMITAVA GANGULY AGED ABOUT 52 YEARS OCCUPATION: SENIOR VICE PRESIDENT AND GROUND HEAD - TAXATION RESIDING AT BAGMANE TECHNOLOGY PARK LAUREL BUILDING C V RAMAN NAGAR BENGALURU - 560 003 …PETITIONER (BY SRI. PAI DHUNGAT ANKUR DEEPAK, ADVOCATE) AND: 1. ASSISTANT COMMISIONER OF INCOME TAX CIRCLE 4 (1) (1) BMTC BUILDING 80 FEET ROAD, 6TH BLOCK NEAR KHB GAMES VILLAGE KORAMANGALA BENGALURU - 560 095 2. THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEALS CENTRE Digitally signed by REKHA R Location: High Court of Karnataka - 2 - NC: 2024:KHC:38195 WP No. 22411 of 2024 INCOME TAX DEPARTMENT MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK NEW DELHI - 110 001 …RESPONDENTS (BY SRI. SUSHAL TIWARI, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE FOLLOWING ANNEXURE-F, IMPUGNED APPELLATE ORDER DATED 25.04.2024 PASSED BY THE R-2 UNDER SEC 250 OF THE IT ACT FOR THE AY 2016-17 IN DIN AND ORDER NO. ITBA/NFAC/S/250/2024-25/1064344325(1) PASSED IN APPEAL NO. CIT(A), BENGALURU - 4/10030/2019-20, GRANT AN INTERIM ORDER TO PENDING THE HEARING AND FINAL DISPOSAL OF THIS PETITION AND ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR ORAL ORDER In this petition, the petitioner seeks the following reliefs: “(i) Issue writ of certiorari or any other writ as the Hon'ble High Court may deem fit and quash Annexure 'F' impugned appellate order dated 25.04.2024 passed by the respondent No.2 under Section 250 of the IT Act for the AY 2016-17 in DIN & Order No.ITBA/NFAA/S/250/2024- 25/1064344325(1) passed in Appeal No.CIT(A), Bengaluru-4/10030/2019-20. (ii) Issue any other writ, order or direction to which the Petitioner is found entitled to in the present facts and circumstances.” - 3 - NC: 2024:KHC:38195 WP No. 22411 of 2024 2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3. A perusal of the material on record will indicate that aggrieved by the penalty order dated 29.03.2019 passed by respondent No.1, the petitioner filed an appeal before respondent No.2 First Appellate Authority on 29.04.2019. In pursuance of the same, respondent No.2 issued a notice to the petitioner on 24.01.2021 to which the petitioner submitted duly written submissions vide Annexure - E dated 08.02.2021 in which he made a request for personal hearing. It is the grievance of the petitioner that despite putting forth duly written submissions and asking for opportunity for personal hearing, respondent No.2 First Appellate Authority has proceeded to pass the impugned order Annexure - F dated 25.04.2024 summarily dismissing the appeal without recording any reasoned order, which deserves to be set aside. 4. Per contra learned counsel for respondents supports the impugned order and submits that there is no merit in the petition and the same is liable to be dismissed. It is also submitted that the petitioner has an alternative remedy by way of an appeal - 4 - NC: 2024:KHC:38195 WP No. 22411 of 2024 against the impugned order and as such the present petition is not maintainable and liable to be dismissed on this ground also. 5. As rightly contended by the learned counsel for the petitioner and Annexure - E dated 08.02.2021 alone not only indicate the petitioner has put forth various grounds, submission, contentions, documents, etc., in support of his claim, but also sought for opportunity of personal hearing, which is undisputedly not been granted by respondent No.2. It is also pertinent to note that the impugned order is clearly non-speaking order without assigning proper and cogent reasons as to why respondent No.2 dismissed the appeal confirming the penalty order passed by respondent No.1 and consequently, in view of violation of principles of natural justice noted supra, I am of the considered opinion that the impugned order Annexure - F deserves to be set aside and the matter has to be remitted back to respondent No.2 for reconsideration afresh in accordance with law. 6. In the result, pass the following: ORDER (i) The petition is hereby allowed. - 5 - NC: 2024:KHC:38195 WP No. 22411 of 2024 (ii) The Impugned order at Annexure - F is hereby set aside. (iii) Matter is remitted back to respondent No.1 First Appellate Authority for reconsideration afresh in accordance with law. (iv) Liberty is reserved in favour of the petitioner to submit replies, responses, pleadings, documents, etc., to the respondent, who shall consider the same, provide sufficient and reasonable opportunity to the petitioner and also grant personal hearing and proceed further in accordance with law. In view of disposal of writ petition, pending applications does not survive for consideration and the same are also disposed of. Sd/- (S.R.KRISHNA KUMAR) JUDGE RR List No.: 1 Sl No.: 50 "