NORTHLAND HOLDING COMPANY V. DEPUTY COMMISSIONER OF INCOME TAX

WP/21200/2022

AI Insights

The case involves Northland Holding Company Private Limited, which filed a writ petition against the Deputy Commissioner of Income Tax and the Principal Commissioner of Income Tax, challenging the assessment order and related notices issued for the assessment year 2020-21. The petitioner argued that they were unable to submit their response due to technical glitches and were not given a fair opportunity to present their case, which led to the impugned orders being passed without considering their submissions. The court found that the principles of natural justice were violated as the respondents did not consider the petitioner's submissions made physically due to technical issues with their online portal.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 764571 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 04-11-2022
• Assessment Year: misc
• Laws Referred To: Article 226 of the Constitution of India, Section 143(3) of the Income Tax Act, Section 144B of the Income Tax Act, Section 156 of the Income Tax Act, Section 274 of the Income Tax Act, Section 270A of the Income Tax Act, Section 271AAC(1) of the Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: SUDHEENDRA
• Keywords: Adjournment request; Assessment Order; Income Tax; Natural Justice; Technical glitches; Writ petition
• Section: 143(3); 274; 270A; 144B; 271AAC(1); 156

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF NOVEMBER, 2022 BEFORE THE HON’BLE MR.JUSTICE S.R.KRISHNA KUMAR WRIT PETITION No.21200/2022 (T-IT) BETWEEN: NORTHLAND HOLDING COMPANY PRIVATE LIMITED PRESTIGE FALCON TOWER NO.19, BRUNTON ROAD BANGALORE-560 025 A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956 WITH PAN AACCN9794P AND REPRESENTED BY ITS AUTHORIZED SIGNATORY MR.MANOJ KRISHNA J.V. … PETITIONER (BY SRI SUDHEENDRA B.R., ADVOCATE) AND: 1 . DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 5(1)(1), BANGALORE BMTC BUILDING, 80 FEET ROAD 6TH BLOCK, KORAMANGALA BANGALORE-560 095 2 . PRINCIPAL COMMISSIONER OF INCOME TAX BANGALORE-5 BANGALORE BMTC BUILDING 80 FEET ROAD, 6TH BLOCK KORAMANGALA BANGALORE-560 095. (REPRESENTING THE NATIONAL 2 FACELESS ASSESSMENT CENTRE) … RESPONDENTS (BY SRI E.I.SANMATHI, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASHING THE ASSESSMENT ORDER PASSED BY THE ASSESSMENT UNIT, INCOME TAX DEPARTMENT UNDER SECTION 143 (3) READ WITH SECTION 144B DATED 22.09.2022 BEARING DIN ITBA/AST/S/143(3)/2022- 23/1045805344(1) FOR THE AY 2020-21 (ANNEXURE-J) AND ETC. THIS PETITION COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING: ORDER 1. In this writ petition, petitioner seeks the following reliefs: \"(a) Quashing the assessment order passed by the Assessment Unit, Income tax department under section 143(3) read with section 144B dated: 22.9.2022 bearing DIN ITBA/AST/S/143(3)/2022- 23/1045805344(1) for the AY 2020-21 (Annexure-J). (b) Quashing the computation sheet dated 22.9.2022 sent along with the impugned assessment order by the Assessment Unit, Income tax department bearing DIN ITBA/AST/S/630/2022-23/1045805376(1) for the AY 2020-21 (Annexure K). (c) Quashing the notice of demand under section 156 dated 22.9.2022 bearing DIN ITBA/AST/S/156/2022-23/1045805362(1) for the AY 2020-21 (Annexure-L). 3 (d) Quashing the notice for penalty under section 274 read with section 270A dated 22.9.2022 for the AY 2020-21 with DIN ITBA/PNL/S/270A/2022-23/ 1045805369(1) (Annexure-M). (e) Quashing the notice for penalty under section 274 read with section 271AAC(1) dated 22.9.2022 for the AY 2020-21 with DIN ITBA/PNL/S/271AAC(1)/ 2022-23/1045805370(1) (Annexure N). (f) Passing such other or further orders as this Hon'ble High Court may think fit in the facts and circumstances of the case, in the interests of justice and equity. 2. Heard Sri Sudheendra B.R., learned counsel for the petitioner and Sri E.I.Sanmathi, learned counsel for the respondents and perused the material on record. 3. In addition to reiterating various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner invites my attention to the show-cause notice dated 02.09.2022 produced at Anneuxre-H1 in order to point out that the petitioner was granted time up to 07.09.2022 to submit 4 the reply/response to the said notice. It is submitted that due to bonafide reasons, unavoidable circumstances and sufficient cause, petitioner was not in a position to submit the reply/response along with relevant documents on or before 07.09.2022 and accordingly, petitioner submitted a request on 07.09.2022 seeking adjournment up to 09.09.2022. Subsequently, after compiling and collating all the documents, petitioner attempted to submit the reply/response to the respondents, which was not possible in view of technical glitches in the portal of the respondents. Accordingly, the petitioner submitted a detailed physical reply/response along with relevant documents on 10.09.2022 to the respondents. 4. It is the grievance of the petitioner that despite the aforesaid facts and circumstances, in particular, the adjournment request and the reply/response along with relevant documents being submitted physically to the respondents, respondents have proceeded to pass the impugned assessment order on the erroneous premise that the petitioner has not submitted its reply along with relevant documents and as such, petitioner is before this Court by way of the present petition. 5 5. Per contra, learned counsel for the respondents submits that there is no merit in the petition and same is liable to be dismissed. 6. As rightly contended by the learned counsel for the petitioner, the material on record discloses that on 07.09.2022, petitioner has made a specific request for adjournment up to 09.09.2022 on the ground that it was not in a position to collate and compile the documents and submit the same along with detailed response. So also on 09.09.2022, petitioner was not in a position to submit the same on account of technical glitches in the portal of the respondents. It was also seen that on 10.09.2022, a detailed response/reply along with relevant documents have been submitted by the petitioner physically to the respondents, all of which have not been considered or adverted to by the respondents while passing the impugned order subsequently on 22.09.2022. Thus, the impugned assessment order passed is clearly violative of principles of natural justice and by adopting a justice oriented approach, I am of the opinion that one more opportunity has to be given to the 6 petitioner to contest the proceedings by setting aside the impugned order and remitting the matter back the respondents for reconsideration afresh in accordance with love. 7. In the result, I pass the following: ORDER (i) Petition is hereby allowed. (ii) The impugned assessment order dated 22.09.2022 is set aside. (iii) The matter is remitted to the respondents with a direction to them to accept the reply/response along with documents produced by the petitioner and pass orders in accordance with law after giving opportunity of personal hearing to the petitioner. (iv) Liberty is reserved to the petitioner to produce additional pleadings/documents etc., before the respondents, who shall consider the same and proceed further in accordance with law. SD/- JUDGE PKS "