Rangasaimaiah Ravikumar V. Income Tax Officer Ward No - 5 (3) (4) and National Faceless Assessment Centre and Principal Chief Commissioner of Income Tax

WP/14654/2024

AI Insights

The case revolves around a writ petition filed by Rangasaimaiah Ravikumar challenging the validity of several notices and orders issued by the Income Tax Department concerning the assessment year 2015-16. The primary contention was the inadequate time provided to respond to the notice under Section 148-A(b) of the Income Tax Act, 1961, which allegedly violated the statutory requirement of a minimum seven-day notice period. The petitioner argued that this short notice period led to prejudice, affecting the ability to respond and contest the subsequent orders and penalties imposed. The court examined the procedural compliance of the notices and found them lacking, leading to the setting aside of all related orders and notices.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 820567 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 03-07-2024
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M DILIP
• Assessee Lawyers: RAVISHANKAR
• Keywords: Assessment; Capital Gains; Income Tax; Notice; Prejudice
• Section: 147; 148; 144; 144B; 148A(b); 148A(d); 149(1)(b)

Judgement Text

" - 1 - NC: 2024:KHC:25043 WP No. 14654 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF JULY, 2024 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 14654 OF 2024 (T-IT) BETWEEN: 1. RANGASWAMAIAH RAVIKUMARA AGE 60 YEARS NO.96/6, 1ST FLOOR, MALLESHWARAM 10TH CROSS (ALSO AT) BANGALORE - 560 003 PAN: AQFPR6446A … PETITIONER (BY SRI. RAVI SHANKAR S V., ADVOCATE) AND: 1. INCOME TAX OFFICER WARD NO - 5 (3) (4) BANGALORE - 560 032 2. NATIONAL FACELESS ASSESSMENT CENTRE ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER OF INCOME TAX INCOME TAX OFFICER INCOME TAX DEPARTMENT, MINISTRY OF FINANCE ROOM NO.401, 2ND FLOOR, E RAMP, JAWAHARLAL NEHRU STADIUM DELHI - 110 003 Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:25043 WP No. 14654 of 2024 3. THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX THE OFFICE OF THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX C R BUILDING BANGALORE - 560 001 … RESPONDENTS (BY SRI. M. DILIP, JUNIOR STANDING COUNSEL) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO i) DIRECT, QUASH THE NOTICE UNDER SECTION 148A(b) OF THE ACT, DTD 23.03.2022 BEARING DIN NO. ITBA/AST/F/148A(SCN)/2021- 22/1041316744(1), ISSUED BY THE R-1 FOR THE ASSESSMENT YEAR 2015-16 HEREIN MARKED AS ANNEXURE-A AND ETC. THIS PETITION COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING: ORDER Petitioner has called in question the validity of the notice under Section 148-A(b) of the Income Tax Act, 1961 (for short 'the Act') at Annexure-A as well as the order under Section 148-A(d) at Annexure-A1; notice under Section 148 of the Act at Annexure-A2; order under Section 147 read with Section 144, 144B of the Act at Annexure-A3 and the penalty orders at Annexures-A4 to A6. - 3 - NC: 2024:KHC:25043 WP No. 14654 of 2024 2. It is the contention of the learned counsel for the petitioner that the notice under Section 148-A(b) is issued on 23.03.2022 with a direction for furnishing reply on or before 29.03.2022 which is in violation of the mandate of time of 7 days that is required to be afforded for making out reply to the notice under Section 148-A(b). 3. It is contended that in light of the inability of the petitioner to respond to such notice due to short time made available, the petitioner has been prejudiced and consequently, the order under Section 148-A(d) and other proceedings leading to passing of the assessment order, are required to be set aside. 4. Section 148-A(b) of the Act reads as follows: \"(b) provide an opportunity of being heard to the assessee, by serving upon him a notice to show cause within such time, as may be specified in the notice, being not less than seven days and but not exceeding thirty days from the date on which such notice is issued, or such time, as may be extended by him on the basis of an application in this behalf, as to why a notice under section 148 should not be issued on the basis of information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year and results of enquiry conducted, if any, as per clause (a).\" - 4 - NC: 2024:KHC:25043 WP No. 14654 of 2024 5. Admittedly, the time afforded in the notice is less than 7 days as required to be afforded. If that were to be so, the contention of prejudice being caused due to non-adherence to the time period under Section 148-A(b) requires to be accepted. 6. Learned counsel for the Revenue would contend that the matter may be remitted to the stage of reply to Section 148-A(b) notice, as, if the notice itself is set aside, the question of initiating fresh proceedings may be difficult in light of permissibility to issue fresh proceedings at this point of time. 7. Learned counsel for the petitioner submits that even on merits, as the requirement under Section 149(1)(b) is for income having escaped assessment and if the income is less than Rs.50,00,000/- the question of applicability on the extended time does not arise and accordingly, the arguments of the learned counsel for the Revenue is to be rejected. - 5 - NC: 2024:KHC:25043 WP No. 14654 of 2024 8. Perusal of the returns filed by the petitioner at Annexure-B1 and perusal of the calculation made would reveal that the consideration taken is Rs.60,00,000/- while calculation of capital gains would include deduction under Section 48 as well and if that is to be so, the value would fall below Rs.50,00,000/-. 9. In light of the same, the question of reserving liberty as sought for by the Revenue does not arise. 10. Accordingly, notice under Section 148-A(b) of Act at Annexure-A as well as the order under Section 148- A(d) at Annexure-A1; notice under Section 148 of the Act at Annexure-A2; order under Section 147 read with Section 144, 144B of the Act at Annexure-A3 and the penalty orders at Annexures-A4 to A6, are all set aside. 11. Writ petition is disposed off accordingly. Sd/- JUDGE VP "