SRI. A.S. CHINNASWAMY RAJU V. THE COMMISSIONER OF INCOME-TAX

WP/21477/2015

AI Insights

The case involves a writ petition filed by the legal heirs of Sri A.S. Chinnaswamy Raju and Sri C.S. Sunder Raju, directors of M/S Sunray Computers Pvt. Ltd., challenging the recovery orders issued under Section 179 of the Income Tax Act, 1961, for the assessment years 2000-01 to 2002-03. The petitioners argued that these orders were based on earlier proceedings under Section 201(1) and 201(1A) of the Act, which had been set aside by the Supreme Court. The respondents were the Commissioner and Deputy Commissioner of Income-Tax (International Taxation) in Bengaluru. The court's decision to quash the orders was influenced by the Supreme Court's judgment, which addressed similar issues and set a precedent that affected the petitioners' case.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 726753 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 07-07-2021
• Assessment Year: misc
• Other Referred Cases: Engineering Analysis Centre of Excellence (P) Ltd. v. Commissioner of Income Tax
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: ANNAMALAI
• Keywords: Assessment years; Income Tax; Legal heirs; Recovery proceedings; Writ petition
• Section: 201(1); 201(1A); 179

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 7TH DAY OF JULY 2021 BEFORE THE HON'BLE MR.JUSTICE S. SUNIL DUTT YADAV WRIT PETITION No.21477/2015 (T-IT) BETWEEN: 1. SRI A.S. CHINNASWAMY RAJU S/O LATE AKKALA RAJU, AGED ABOUT 85 YEARS DIRECTOR, M/S SUNRAY COMPUTERS PVT. LTD. NO.1, PALACE ROAD, BENGALURU - 560 001. (SINCE PETITIONER NO.1 DECEASED ON 31.03.2017) REPRESENTATIVE BY HIS LEGAL HEIRS, 1(A) SMT. INDIRAMMA WIFE OF LATE SRI A.S. CHINNASWAMY RAJU AGED ABOUT 78 YEARS # 294, 16TH CROSS, SADASHIVANAGAR, BENGALURU - 560 080. 1(B) SRI C.S. SUNDER RAJU SON OF LATE SRI A.S. CHINNASWAMY RAJU AGED ABOUT 59 YEARS # 294, 16TH CROSS, SADASHIVANAGAR, BENGALURU - 560 080. 1(C) SMT. REVATHI RAJU DAUGHTER OF LATE SRI A.S. CHINNASWAMY RAJU AGED ABOUT 55 YEARS # 294, 16TH CROSS, SADASHIVANAGAR, BENGALURU - 560 080. 2 2. SRI C.S. SUNDER RAJU SON OF LATE SRI A.S. CHINNASWAMY RAJU AGED ABOUT 59 YEARS DIRECTOR, M/S. SUNRAY COMPUTERS PVT. LTD., NO.1, PALACE ROAD BENGALURU - 560 001. … PETITIONERS (BY SRI ANNAMALAI S., ADVOCATE FOR SRI BHAIRAV K., ADVOCATE) AND: 1. THE COMMISSIONER OF INCOME-TAX (INTERNATIONAL TAXATION) R.P. BUILDING, NRUPATHUNGA ROAD, BENGALURU - 560 001. 2. THE DEPUTY COMMISSIONER OF INCOME-TAX (INTERNATIONAL TAXATION), CIRCLE - 1(1), R.P. BUILDING, NRUPATHUNGA ROAD, BENGALURU - 560 001. ... RESPONDENTS (BY SRI K.V. ARAVIND, ADVOCATE) ***** THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE IMPUGNED ORDERS DATED 31.03.2015 IN ANNEXURES-A1 & A2 PASSED ON THE PETITIONER NOS.1 & 2 UNDER SECTION 179 OF THE INCOME-TAX ACT, 1961 BY THE R2 AND ETC. THIS WRIT PETITION COMING ON FOR HEARING THIS DAY, THE COURT MADE THE FOLLOWING: 3 ORDER The petitioners have sought for quashing of the order dated 31.03.2015 passed under Section 179 of the Income Tax Act, 1961 (\"the Act\", for short) for the assessment years 2000-01, 2001-02, 2002-03 as regards petitioner no.1, vide Annexure-A1 and has also sought for setting aside of the order dated 31.03.2015 passed under Section 179 of the Act, for the assessment years 2000-01, 2001-02, 2002-03 as regards petitioner no.2 vide Annexure-A2. 2. It is submitted that the proceedings under Section 179 of the Act relates to recoveries pursuant to the orders passed under Section 201 (1) and 201 (1A) of the Income Tax Act as regards the petitioners. 3. It is further submitted that the order of the Division Bench in ITA Nos.756/2006 c/w 757/2006, 758/2006, 168/2004 and 170/2004, whereby the appeals of 4 the Department came to be allowed is stated to have been set aside as per the orders passed by the Apex Court in the judgment in Engineering Analysis Centre of Excellence (P) Ltd. v. Commissioner of Income Tax in Civil Appeal No.8733-8734/2018 and the Apex Court had clarified that this judgment would be applicable with respect to other matters including Civil Appeal Nos.10115-10117/2013. Accordingly, the order passed under Section 201 (1) and 201 (1A) of the Income Tax Act as regards the petitioners have been set aside. 4. In light of the same, the impugned order relating to recovery proceedings pursuant to the order under Section 201 (1) and 201 (1A) of the Income Tax Act referred to above are set aside. The contentions raised in the petition on its merits insofar as the order under Section 179 does not call for any adjudication. Sd/- JUDGE Np/- "