SHRI HIREMAGALUR KRISHNAPRASAD V. THE ASSISTANT COMMISSIONER OF INCOME TAX

WP/3225/2020

AI Insights

The case involves Shri Hiremagalur Krishnaprasad, the petitioner, challenging the validity of an assessment order passed by the Income Tax Department under Section 144 of the Income Tax Act. The petitioner argued that the order was passed without waiting for the response to the notice under Sections 271F and 142, which was set to expire on 06.12.2019. The respondents contended that multiple notices had been issued previously, and substantial compliance with the principles of natural justice had been met. However, the court focused on the specific notice that granted additional time to the petitioner, leading to the conclusion that the assessment order was improperly passed.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 767634 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 30-06-2021
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: JEEVAN NEERALGI
• Assessee Lawyers: ARAVIND CHAVAN
• Keywords: Assessment; Income Tax; Natural Justice; Writ petition; Technical Contention
• Section: 144; 271F; 142

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 30TH DAY OF JUNE, 2021 BEFORE THE HON'BLE MR. JUSTICE S. SUNIL DUTT YADAV WRIT PETITION No.3225/2020 (T – IT) BETWEEN: Shri Hiremagalur Krishnaprasad S/o. Late Sri. Hiremagalur Srinivasaiyengar Narasimha Iyengar, Aged 73 years, R/at. No.112, Kingston Circle, Goldsboro, NC-27530 Rep. by SPA Holder Sri. G.R.Narasimhan, S/o. Late G.A.Ranghanathan, Aged 72 years, R/at. No.4143/D, 8th A Cross, B Block, Rajajinagar 2nd Stage, Subramanya Nagar, Bengaluru – 560021. …Petitioner (By Sri.Aravind V. Chavan, Advocate) AND: 1. The Assistant Commissioner Of Income Tax, International Taxation, Circle-1 (2), BMTC Building, 80 feet Road, Koramangala, Bengaluru – 560095. 2 2. Deputy Commissioner of Income Tax, International Taxation, Circle-1(2), BMTC Building, 80 feet Road, Koramangala, Bengaluru – 560095. 3. The Commissioner of Income Tax International Taxation, BMTC Building, 80 feet Road, Koramangala, Bengaluru – 560095. ...Respondents (Sri Jeevan J Neeralgi, Advocate) This Writ Petition is filed under Articles 226 and 227 of the Constitution of India praying to declaration that the sale consideration arising from the sale deed 23.12.2010 having been self-assessed in the hands of M/s.Daffodil Designers and Developers Pvt. Ltd., who received the consideration amount cannot be brought to Tax in the hands of the petitioner who has not received the consideration amount for assessment year 2011-12 and etc. This Writ Petition coming on for Orders this day, the Court made the following: 3 O R D E R The petitioner has called in question the validity of the order passed under Section 144 of the Income Tax Act by the respondent No.2 dated 05.12.2019 at Annexure-P. 2. The learned counsel for the petitioner submits that insofar as the proceedings initiated under Section 271F and also the assessment proceedings, the petitioner was notified by way of an e-mail copy of which is enclosed at Annexure-N and that time for responding to the notice under Sections 271F and 142 (wrongly mentioned as 242(1) of the Income Tax Act in the said email) has been communicated to him granting time till 06.12.2019 to reply to the notice under Section 271F and 142 failing which the order would be passed on the material available on record without affording any further opportunity. 4 3. It is further submitted that the assessment order came to be passed on 05.12.2019 itself without waiting for the extended time i.e., till 06.12.2019 as afforded at Annexure-N. Though other contentions are raised on merits including that there was no taxable income during the relevant period of time while contending that the income that was sought to be taxed in its hand relates to sale of a flat by a developer to whose share the flat had fallen and had been assigned. However such contention may not be relevant in the present proceedings in light of the contentions raised regarding passing of an order on 05.12.2019, while granting him time to respond to the notices till 06.12.2019. 4. Learned counsel for the Revenue, however, points out that as regards to the same tax period, earlier notices were issued on multiple times including on the various dates on 30.03.2018 at Annexure-H, 5 07.08.2019 at Annexure-K, 08.112019 at Annexure – L. It is further submitted that even as regards the proposed penalty notice was issued under Section 271F on 08.11.2019 and accordingly, the contention raised by the petitioner is technical in nature and as substantial opportunities has been provided to him by the notices referred to the above, the contention raised by relying on the notice at Annexure-N needs to be rejected as there has been substantial compliance with the principles of natural justice. 5. No doubt as pointed out by the learned counsel for the respondent that there have been multiple notices admittedly issued to the petitioner. However, the petitioner would contend that as he is not residing in India, in response to the earlier notices, there were difficulties in responding to the earlier notices. 6 6. Noting that admittedly as per Annexure-N time was granted till 06.12.2019, it is impermissible for the department to state that the earlier notices were sufficient and that the order passed on 05.12.2019 ought to be up held. Taking note of the notice at Annexure-N granting time till 06.12.2019, the order passed at Annexure-P on 15.12.2019 is liable to be set aside on the sole ground of having been passed within the time granted to the petitioner to respond. 7. Taking note that the petitioner is entitled for extension of time as granted by the respondent, the petitioner is permitted to appear before the Assessment Officer and make use of the opportunity of placing his case before the Assessing Officer. The impugned order is set aside. The asessee has to mark his presence before the Assessing Officer either personally or through representative on 16.07.2021. 7 8. The petitioner undertakes to co-operate with the Authorities to complete the assessment proceeding within the period not later than three months from the date of appearance. The petitioner also undertakes not to raise any contention on the ground of time prescribed for completion of the assessment proceedings. Accordingly, the petition is disposed of. Sd/- JUDGE GJM "