SRI BASAVARAJU MUNINARAYANA V. INCOME TAX OFFICER WARD NO 6(2)(4)

WP/4943/2023

AI Insights

The case involves two writ petitions filed by Sri Basavaraju Muninarayana against various income tax authorities, challenging the assessment orders and attachment orders issued for the assessment years 2015-16 and 2016-17. The petitioner argued that he was not given a proper opportunity to respond to the notices, which were sent to an outdated email address of his former auditor. The court found that the petitioner was not adequately notified and thus did not have a fair opportunity to contest the assessments, leading to the quashing of the orders and a directive for a re-assessment after considering the petitioner's submissions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 690251 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 17-04-2023
• Assessment Year: misc
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M DILIP
• Assessee Lawyers: SHESHASHALA; ARAVIND CHAVAN
• Keywords: Assessment Order; Attachment Order; Email notification; Income Tax; Jurisdiction; Satisfaction note
• Section: 153C; 226

Judgement Text

" - 1 - WP No. 4943 of 2023 C/W WP No. 4847 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16TH DAY OF MARCH, 2023 BEFORE THE HON'BLE MR JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 4943 OF 2023 (T-IT) C/W WRIT PETITION NO. 4847 OF 2023 (T-IT) IN WP NO. 4943/2023 BETWEEN: SRI BASAVARAJU MUNINARAYANA S/O BASAVARAJU AGED 38 YEARS R/AT NO 10 LAKSHMI NILAYA MUNESHWARA TEMPLE ROAD NAGASHETTIHALLI BANGALORE 560094. …PETITIONER (BY SRI. SHESHASHALA, SENIOR ADVOCATE FOR SRI.ARAVIND V CHAVAN.,ADVOCATE) AND: 1. INCOME TAX OFFICER WARD NO 6(2)(4) BMTC BUILDNG 80 FEET ROAD, KORAMANGALA BENGALURU 560095. Digitally signed by NARASIMHA MURTHY VANAMALA Location: HIGH COURT OF KARNATAKA - 2 - WP No. 4943 of 2023 C/W WP No. 4847 of 2023 2. PRINCIPAL COMMISSIONR OF INCOME TAX -6 BMTC BUILDING 80 FEET ROAD KORAMANGALA BENGALURU 560095. 3. ASSISTANT COMMISSIONER OF TAX CENTRAL CIRCLE 2(4) C R BUILDING QUEENS ROAD BANGALORE 560001. 4. PRINCIPAL COMMISSIONER OF TAX CENTRAL CIRCLE C R BUILDING QUEENS ROAD BANGALORE 560001. …RESPONDENTS (BY SRI.M. DILIP., ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECTING THE RESPONDENTS TO FURNISH THE SATISFACTION NOTE PREPARED IN THE CASE OF THE ASSESSEE BY THE TRANSFERRING ASSESSING OFFICER RESPONDENT NO.1 TO THE THIRD RESPONDENT WHICH IS MANDATORY U/S. 153C OF THE IT ACT; QUASH THE ATTACHMENT ORDER PASSED U/S. 226 OF THE IT ACT DATED 4.11.2022 BEARING NO. ITBA/COM/F/17/2022-2023/ 1046907033(1) ANNEXURE-E2 PASSED BY THIRD RESPONDENT FOR ASSESSMENT YEAR 2015-16. IN WP NO. 4847/2023 BETWEEN: BASAVARAJU MUNINARAYANA S/O BASAVARAJU, AGED ABOUT 38 YEARS, - 3 - WP No. 4943 of 2023 C/W WP No. 4847 of 2023 R/AT NO.10, LAKSHMI NILAYA, MUNESHWARA TEMPLE ROAD, NAGASHETTIHALLI, BANGALORE-560094. …PETITIONER (BY SRI. M.V. SHESHACHALA, SENIOR ADVOCATE FOR SRI. ARAVIND V CHAVAN.,ADVOCATE) AND: 1. INCOME TAX OFFICER WARD -6(2)(4), BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU-560095. 2. PRINCIPAL COMMISSIONER OF INCOME TAX-6 BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU 560095. 3. ASSISTANT COMMISSIONER OF TAX CENTRAL CIRCLE-2(4) C.R.BUILIDING, QUEENS ROAD, BANGALORE 560001. 4. PRINCIPAL COMMISSIONER OF TAX CENTRAL CIRCLE, C.R.BUILDING, QUEENS ROAD, BANGALORE-560001. …RESPONDENTS (BY SRI.M. DILIP., ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLE 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECTING THE RESPONDENTS TO FURNISH THE SATISFACTION NOTE PREPARED IN THE CASE OF THE ASSESSES BY THE TRANSFERRING ASSESSING - 4 - WP No. 4943 of 2023 C/W WP No. 4847 of 2023 OFFICER R-1 TO THE THIRD RESPONDENT WHICH IS MANDATORY U/S 153C OF THE IT ACT; QUASH THE ATTACHMENT ORDER PASSED U/S 226 OF THE IT ACT DATED 04.11.2022 BEARING NO.ITBA/COM/F/17/2022-23/1046907033(1) ANNX-D1 PASSED BY THIRD RESPONDENT FOR ASSESSMENT YEAR 2016-17; QUASH THE ASSESSMENT ORDER DATED 05.07.2021 BEARING NO.ITBA/AST/S/153C/ 2021-22/1034006267(1) ANNX-C PASSED BY THE R-3 FOR ASSESSMENT YEAR 2016-17. THESE PETITIONS, COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER These petitions are because the petitioner is aggrieved by the third respondent’s assessment order dated 05.07.2021 for two assessment years viz., 2015-16 and 2016-17 and the attachment orders issued on 04.11.2022 under Section 226 of the Income Tax Act 1961. Sri M.V.Sheshachala, the learned Senior Counsel for the petitioner, and Sri.M.Dilip, the learned standing counsel for the respondents, are heard for final disposal in the light of the petitioner’s principal grievance that he has not received due opportunity. - 5 - WP No. 4943 of 2023 C/W WP No. 4847 of 2023 Sri M.V.Sheshachala submits that the notice is issued under Section 153C of the IT Act for commencement of proceedings through email in [e-mail]. This email ID belongs to the petitioner’s erstwhile Auditor, Sri Lokesh Babu B.V., who, as ascertained later, is confined to bed and he has discontinued practice after falling ill during the second wave of Covid 19 pandemic in the month of the March 2021. The petitioner has appointed a new Chartered Accountant, Sri. Shivananda because he could not contact Sri Lokesh Babu B.V, and through him the petitioner has filed Returns for the year 2021-22 and 2022-23 with new email ID “[e-mail]”. The failure to respond to such show notice has resulted in the impugned assessment orders. If the petitioner is provided with due opportunity, he can demonstrate that the assessing officer [the third respondent] could not have - 6 - WP No. 4943 of 2023 C/W WP No. 4847 of 2023 assumed jurisdiction for initiation of proceedings under the provisions of Section 153C of the IT Act. Sri M.Dilip, the learned standing counsel for the respondents, does not controvert the circumstances pleaded by the petitioner to justify his non- participation consequent to the notice dated 16.04.2021 and failure to furnish details. As regards the petitioner’s contention that the assessing officer [the third respondent] could not have assumed jurisdiction for initiation of proceedings under section 153C of the IT Act, Sri M. Dilip submits that this grievance could be considered if the petitioner were to appear before the third respondent and file necessary submissions. In rejoinder, Sri M.V.Sheshachala submits that the petitioner would appear before the third respondent and file submissions with all the details on 17.04.2023. In the circumstances discussed, and the submissions now made, the petitions are allowed - 7 - WP No. 4943 of 2023 C/W WP No. 4847 of 2023 quashing the assessment orders dated 05.07.2021 and attachment order dated 04.11.2022 impugned in these writ petitions as Annexure-C and D1 respectively, and the penalty order in W.P.4943/2023 restoring the corresponding proceedings to the third respondent. The petitioner shall appear before the third respondent without further notice on 17.04.2023 and shall be at liberty to file detailed submissions, and it would be needless to observe that the third respondent shall consider these submissions and pass suitable orders. Sd/- JUDGE SA,NV ct:sr "