SREE ANJANEYA SEVA SAMIDHI V. THE INCOME TAX OFFICER

WP(C)/25086/2022

AI Insights

The case involves Sree Anjaneya Seva Samidhi, a trust registered under Section 12AA of the Income Tax Act, which filed a 'nil' income return for the assessment year 2014-2015. The Centralized Processing Centre (CPC) in Bangalore issued a notice to the petitioner for not accompanying the return with an audit report in Form No.10B, leading to a demand for tax. The petitioner contested this demand, arguing that the audit report was filed but not considered. The Income Tax Officer, the jurisdictional authority, had not responded to the petitioner's rectification application, leading to the filing of this writ petition. The court's decision aims to ensure that the petitioner's rectification application is addressed before any further action on the penalty and tax demand.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 750619 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 04-08-2022
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Applicant
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: DIVYA RAVINDRAN
• Keywords: Audit report; Form No. 10B; Income tax exemption; Penalty proceedings; Rectification Application
• Section: 143(1); 12AA

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. THURSDAY, THE 4TH DAY OF AUGUST 2022 / 13TH SRAVANA, 1944 WP(C) NO. 25086 OF 2022 PETITIONER: SREE ANJANEYA SEVA SAMIDHI 1, KADALEEVANAM, NEAR ICIC BANK, FORT ROAD, PALAKKAD, PIN - 678501 BY ADV DIVYA RAVINDRAN RESPONDENTS: 1 THE INCOME TAX OFFICER EXEMPTION WARD , AYAKAR BAHVAN, SHAKTHAN THAMPURAN NAGAR, MUNCIPAL OFFICE ROAD, THRISSUR, PIN - 680001 2 CENTRAL PROCESSING CENTER 1ST FLOOR, PRESTIGE ALPHA NO. 48/1, HOSUR ROAD, BANGALORE, PIN - 560100 3 THE PRINCIPAL COMMISSIONER OF INCOME TAX CENTRAL REVENUE BUILDING, I.S PRESS ROAD, KOCHI, PIN – 682018. OTHER PRESENT: JOSE JOSEPH , S/C THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 04.08.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P (C) No.25086/2022 -2- J U D G M E N T The petitioner is a trust registered under Section 12AA of the Income Tax Act. By virtue of such registration, the income of the trust is exempted from taxation. For the assessment year 2014-2015 the petitioner filed a return of income on 10-02- 2015 declaring 'nil' income. The copy of the return e-filed by the petitioner with acknowledgment No.479562050100215 is produced as Ext.P2. The Centralized Processing Centre (CPC) of the Income Tax Department, Bangalore issued a notice to the petitioner stating that the return filed by the petitioner was not accompanied with an audit report in Form No.10B of the Income Tax Rules. On receipt of that communication the petitioner uploaded Form No.10B audit report dated 17-02- 2016 vide acknowledgment No.9550135311710216 (see Ext.P4) along with a revised return. The revised return was processed creating Ext.P5 demand for payment of tax of Rs.43,20,990/-. It is submitted that the demand was raised only on account of the fact that according to the CPC, the petitioner had not filed Form No.10B audit report. On receipt of Ext.P5 the petitioner filed Ext.P6 application for rectification before the CPC which was rejected by Ext.P7 stating that the application can be considered only the jurisdictional Income tax officer. Accordingly the petitioner filed Ext.P8 on 05-02-2019 before the 1st respondent, who is jurisdictional Income tax officer. It is submitted that despite filing of Ext.P8 as early as on 05-02-2019 no orders have been passed on the same and in the meanwhile penalty proceedings have been initiated against the petitioner. The learned counsel for the petitioner states that a direction may be issued to the 1st respondent to consider and pass orders on Ext.P8 before a proceedings for penalty are finalized against the petitioner. W.P (C) No.25086/2022 -3- 2. The learned Standing Counsel appearing for the Department no objection to such a direction being issued. 3. Accordingly, this writ petition is disposed of directing the 1st respondent to consider and pass orders on Ext.P8 application for rectification after affording an opportunity of hearing to the petitioner within a period of 2 months from the date of receipt of a certified copy of this judgment. Till orders are passed on Ext.P8, the penalty proceedings initiated against the petitioner shall not be finalized. Needless to say any proceedings for recovery of amounts due under Ext.P5 shall also be kept in abeyance, pending consideration of Ext.P8 by the 1st respondent. Sd/- GOPINATH P. JUDGE AMG W.P (C) No.25086/2022 -4- APPENDIX OF WP(C) 25086/2022 PETITIONER EXHIBITS Exhibit P1 THE TRUE COPY OF THE REGISTRATION CERTIFICATE OBTAINED BY THE PETITIONER UNDER SECTION 12AA Exhibit P1(a) THE TYPED COPY OF THE EXHIBIT-P1 Exhibit2 TRUE COPY PF THE RETURN E-FILED BY THE PETITIONER FOR AY 2014-15 Exhibit3 THE TRUE COPY OF THE COMMUNICATION RECEIVED FROM THE CPC, BANGALORE, THE 2ND RESPONDENT HEREIN, DATED 17.11.2015. Exhibit4 THE TRUE COPY OF THE REVISED RETURN FILED FOR AY 2014-15 ALONG WITH THE AUDIT REPORT Exhibit5 THE TRUE COPY OF THE INTIMATION ORDER ISSUED UNDER SECTION 143(1) FOR AY 2014-15 DATED 16.3.2016 Exhibit6 THE TRUE COPY OF THE RECTIFICATION ACKNOWLEDGMENT FILED BEFORE THE 2ND RESPONDENT DATED 31.5.2016 Exhibit7 THE TRUE COPY OF THE SCREENSHOT OF REJECTION DATED 16.3.2016 Exhibit8 THE TRUE COPY OF THE RECTIFICATION APPLICATION FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT DATED 5.2.2019 FOR AY 2014-15 Exhibit9 THE TRUE COPY OF THE PENALTY NOTICE DATED 17.1.2020 Exhibit10 TRUE COPY OF THE REPLY DATED 27.01.2020 "