M/S. SHIKHA DEVELOPERS V. THE DEPUTY COMMISSIONER OF INCOME TAX

WP/12536/2022

AI Insights

In this case, M/s. Shikha Developers Partnership Firm, represented by partner Zulfiqar Ahmed Khan, filed a writ petition against the Deputy Commissioner of Income Tax and the Assistant Commissioner of Income Tax, challenging an assessment order and a notice of demand issued under the Income Tax Act, 1961. The petitioner contended that the impugned order was passed without providing sufficient opportunity to respond, violating the principles of natural justice. The court found that the petitioner was unable to respond due to health issues, which constituted a valid reason for not adhering to the deadlines set by the tax authorities. Consequently, the court set aside the assessment order and remitted the matter for fresh consideration, ensuring the petitioner would have the opportunity to present their case adequately.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 767589 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 16-12-2022
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M DILIP
• Assessee Lawyers: MALHAR K
• Keywords: Assessment Order; Income Tax; Natural Justice; Writ of Certiorari; Writ of Mandamus; Writ of prohibition
• Section: 147; 143(2)

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 16TH DAY OF DECEMBER, 2022 BEFORE THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR WRIT PETITION No.12536 OF 2022 (T – IT) BETWEEN: M/S. SHIKHA DEVELOPERS PARTNERSHIP FIRM, FORMED AS PER PARTNERSHIP ACT, 1932 #1/8, 1ST FLOOR, THE PRESIDENCY BUILDING, ST. MARKS ROAD, NEXT TO ST. MARKS HOTEL, BANGALORE – 560001. REP BY: ZULFIQAR AHMED KHAN PARTNER OF THE PETITIONER FIRM. ...PETITIONER (BY SRI. MALHAR RAO.K, ADVOCATE) AND: 1. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE – 2(4), QUEENS ROAD, BENGALURU – 560001. 2. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE – 2(4) QUEENS ROAD, BENGALURU – 560001. …RESPONDENTS (BY SRI. M. DILIP FOR SRI. K.V. ARAVIND, ADVOCATES) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, ALONG WITH THE NOTICE OF DEMAND VIDE DIN/ORDER NO: ITBA/AST/M/147/2021-2022/1042221504(1), BOTH DATED 30.03.2022 VIDE ANNX- E AND ETC. THIS W.P. COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:- 2 ORDER In this petition, petitioner has sought for the following reliefs: a. Issue a Writ of Certiorari or any other appropriate writ or order quashing the impugned order passed by the Deputy Commissioner of Income Tax, along with the notice of demand vide DIN/ORDER NO.: ITBA/AST/M/147/2021-2022/1042221504(1), both dated 30.03.2022, vide ANNEXURE – E; b. Issue a writ of Mandamus or any other appropriate writ or order directing the Respondents not to initiate any recovery based on the impugned order passed by the Respondent No.2 and the notice of demand vide Annexure – E dated 30.03.2022 and not to resort to such other measures pending disposal of this Writ petition. c. Issue a Writ of Prohibition or any other appropriate writ or order prohibiting the Respondents from initiating any recovery proceedings before the disposal of the petition before this Hon’ble Court; d. Grant such other orders of directions deemed fit in the circumstances of the case and in the interests of justice. 2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3 3. A perusal of the material on record including the impugned order will indicate that on 24.02.2022, respondent issued notice under Section 143(2) r/w 147 of the Income Tax Act, 1961 (for short, ‘the IT Act’) to the petitioner calling upon him to submit a reply on or before 28.02.2022. However, prior to 28.02.2022 itself, respondent issued a Show Cause Notice dated 26.02.2022, which has been recorded in the impugned order and accordingly, the respondent proceeded to pass the impugned order without providing sufficient and reasonable opportunity to the petitioner to submit a reply to the notice dated 24.02.2022 and Show Cause Notice 26.02.2022 thereby violating principles of natural justice. It is the specific contention of the petitioner that on account of health issues and ailments which required hospitalization as can be seen from the medical records produced by the petitioner, he was not in a position to submit his response / reply along with documents to the notice dated 24.02.2022 and Show Cause Notice dated 26.02.2022 which was due to bonafide reasons, unavoidable circumstance and sufficient cause. 4 Under these circumstances, I am of the considered opinion that the impugned assessment order deserves be set aside and matter remitted back to the respondents for reconsideration afresh in accordance with law after providing one more opportunity to the petitioner to submit his response / reply as well as provide an opportunity of personal hearing, in accordance with law. 4. In the result, I pass the following: ORDER (i) Petition is hereby allowed. (ii) The impugned Assessment Order at Annexure – E dated 30.03.2022 passed by the respondents are hereby set aside. (iii) Matter is remitted back to the concerned respondents for reconsideration afresh in accordance with law after providing an opportunity to the petitioner to submit his reply along with relevant documents and also providing an opportunity of personal hearing. 5 (iv) Liberty is reserved in favour of the petitioner to submit its reply / response to the Notice dated 24.02.2022 as well as Show Cause Notice dated 26.02.2022 and also to submit additional pleadings, documents, etc., before the respondents, who shall consider the same and proceed further in accordance with law, after providing opportunity of personal hearing to the petitioner. Sd/- JUDGE SV "