South India Steel Industries Ltd V. Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income Tax Officer National Faceless Assessment Centre and Income Tax Officer Ward 7(2)(1) Bangalore and Principal Commissioner of Income Tax-1 and State of Karnataka to Housing and Urban Development and Karnataka Industrial Area Development Board

WP/13157/2024

AI Insights

The case involves South India Steel Industries Ltd, which filed a writ petition against the order passed by the Revisional Authority under Section 263 of the Income Tax Act, 1961. The order set aside the exemption on compensation received for the assessment year 2018-19. The petitioner argued that the Revisional Authority's decision was made in violation of natural justice, as it was concluded before the deadline for response specified in the notice. The court agreed with the petitioner, noting that the premature closure of the revision proceedings denied them the opportunity to present their case adequately.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 796672 (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: TANMAYEE RAJKUMAR
• Keywords: Compensation received; Exemption; Limited scrutiny assessment; Natural Justice; Revisional Authority
• Section: 263; 226

Judgement Text

" - 1 - NC: 2024:KHC:25045 WP No. 13157 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. 13157 OF 2024 (T-IT) BETWEEN: 1. SOUTH INDIA STEEL INDUSTRIES LTD HAVING ITS OFFICE AT NO.54/28, K S GARDEN LALBAGH ROAD, 4TH CROSS, BANGALORE - 560 002 REPRESENTED BY ITS DIRECTOR MR PANKAJ GARG … PETITIONER (BY SRI. TANMAYEE RAJKUMAR., ADVOCATE) AND: 1. ADDITIONAL /JOINT /DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER NATIONAL FACELESS ASSESSMENT CENTRE, ASSESSMENT UNIT ROOM NO 401, II FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM DELHI - 110 003 2. INCOME TAX OFFICER WARD 7(2)(1) BANGALORE 80 FT ROAD, BMTC BUILDING, KORAMANGALA BENGALURU - 560 095 Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:25045 WP No. 13157 of 2024 3. PRINCIPAL COMMISSIONER OF INCOME TAX-1 80 FEET ROAD, BMTC BUILDING, KORAMANGALA, BENGALURU - 560 095 4. STATE OF KARNATAKA TO HOUSING AND URBAN DEVELOPMENT MS BUILDING, BANGALORE - 560 001 REPRESENTED BY ITS PRINCIPAL SECRETARY 5. THE KARNATAKA INDUSTRIAL AREA DEVELOPMENT BOARD NRUPATHUNGA ROAD, BANGALORE - 560 001 REPRESENTED BY ITS MANAGING DIRECTOR … RESPONDENTS (BY SRI. M. DILIP, JUNIOR STANDING COUNSEL) THIS W.P. IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ORDER DTD. 29.03.2023 BEARING NO. ITBA/REV/F/REV5/2022- 23/1051549581(1) (ANNEXURE-E) PASSED BY THE R-3 UNDER SECTION 263 OF THE ACT FOR THE ASSESSMENT YEAR 2018- 19 AND ETC. THIS PETITION COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING: ORDER Petitioner has sought for setting aside of the order at Annexure-E whereby the Revisional Authority in exercise of the power under Section 263 of the Income Tax Act, 1961 has set aside the order of the assessing authority - 3 - NC: 2024:KHC:25045 WP No. 13157 of 2024 insofar as the exemption extended on the compensation received. 2. Learned counsel for the petitioner submits that the order passed by the Revisional Authority is in violation of the principles of natural justice insofar as the notice was issued on 28.03.2023 to appear by 12.04.2023 at 11.00 a.m. and take stand insofar as the proceedings of limited scrutiny assessment, while without waiting for 12.04.2023, on 29.03.2023 itself suo motu revision has been disposed off. 3. Taking note of the admitted facts, once notice was given extending time till 12.04.2023, question of closing the revision proceedings on 29.03.2023 would be in violation of the time prescribed in the notice at Annexure-D and accordingly the order passed in violation of the principles of natural justice prejudicing the right of the petitioner to put forth their case before the Revisional Authority in light of the benefit of exemption having been extended to the petitioner in the assessment proceedings. - 4 - NC: 2024:KHC:25045 WP No. 13157 of 2024 Insofar as the merits of the matter, needless to state that though contentions have been advanced on both sides, that is a matter that requires reconsideration and once the petitioner is permitted to put forth their case, the Authority would be in a better position to appreciate the contentions and arrive at a conclusion in accordance with law. 4. Accordingly, the orders at Annexures-E and H are set aside and the matter is remitted to the Revisional Authority for fresh consideration in accordance with law. Contentions of both sides are kept open. 5. Petition is disposed off. Sd/- JUDGE VP "