Sri Krishnaswamy Sendilkumar, Proprietor V. Assessment Unit Rep. by Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income Tax Officer, National Faceless Assessment Centre, Income Tax Department, Ministry of Finance and The Income Tax Officer Ward-1, Kolar

WP/13159/2024

AI Insights

The case involves Sri Krishnaswamy Sendilkumar, the proprietor of M/s. Nik Enterprises, who challenged the validity of an assessment order and related documents issued by the Income Tax Department for the assessment year 2022-23. The petitioner argued that the time prescribed under the SOP for responding to the notices was not adhered to, referencing a similar case (Chowdapally Dattaprakash Ajay vs. Central Board of Direct Taxes). The court found that the department did not comply with the SOP, leading to the setting aside of all contested documents and remitting the matter back for proper procedure.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 808814 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 04-06-2024
• Assessment Year: misc
• Other Referred Cases: Chowdapally Dattaprakash Ajay vs. Central Board of Direct Taxes \\u2013 (2023) 157 taxmann.com 444 (Karnataka)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: Y V RAVIRAJ; M DILIP
• Assessee Lawyers: VENKATESH
• Keywords: Assessment Order; Income Tax; Penalty; Show cause notice; Standard Operating procedure; Writ petition
• Section: 143(3); 144B

Judgement Text

" - 1 - NC: 2024:KHC:19106 WP No. 13159 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF JUNE, 2024 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 13159 OF 2024 (T-IT) BETWEEN: 1. SRI KRISHNASWAMY SENDILKUMAR SON OF SRI. K. KRISHNASWAMY, AGED ABOUT 47 YEARS, PROPRIETOR, M/S. NIK ENTERPRISES, SY. NO. 100, CHOODAGONDANAHALLI, HOSUR MAIN ROAD, MALUR, KOLAR DISTRICT, KOLAR-563 130. … PETITIONER (BY SRI. VENKATESH. G., ADVOCATE) AND: 1. ASSESSMENT UNIT REP. BY ADDITIONAL/JOINT/DEPUTY/ ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE, INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI-110 003. Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:19106 WP No. 13159 of 2024 2. THE INCOME TAX OFFICER WARD-1, KOLAR, IT OFFICE, NEW EXTENSION, KOLAR-563 101. … RESPONDENTS (BY SRI. Y.V. RAVIRAJ., SENIOR STANDING COUNSEL SRI M. DILIP, JUNIOR STANDING COUNSEL) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ASSESSMENT ORDER PASSED BY THE R-1 UNDER SECTION 143(3) R.W.S 144B OF THE ACT DTD. 21.03.2024 BEARING DIN NO. ITBA/AST/S/143(3)/2023-24/1063069455(1) FOR THE ASSESSMENT YEAR 2022-23 BY THE R-1 HEREIN MARKED AS ANNEXURE-A1 AND ETC. THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, THE COURT MADE THE FOLLOWING: ORDER Sri. Y. V. Raviraj and Sri. M. Dilip, learned counsel accept notice for respondents. 2. Petitioner has called in question the validity of the assessment order dated 21.03.2024 passed under Section 143 (3)read with Section 144B of the Income Tax Act, 1961 (for short the Act’) for the assessment year 2022-23 by respondent No.1 at Annexure-A1. Petitioner has also sought for issuance of writ of certiorari to set - 3 - NC: 2024:KHC:19106 WP No. 13159 of 2024 aside the computation sheet at Annexure-A2, notice of demand at Annexure-A3, show cause notice for penalty at Annexure-A4 and the show cause notice for penalty at Annexure-A5. 3. It is the case of the petitioner that as regards the notice issued, time prescribed and contemplated under the Standard Operating Procedure (SOP) has not been adhered to. It is submitted that in case of proceedings under Section 144-B of the Act, the time stipulated in the SOP for reply to the notice ought to be adhered to. Reliance is placed on the order in the case of Chowdapally Dattaprakash Ajay vs. Central Board of Direct Taxes – (2023) 157 taxmann.com 444 (Karnataka). 4. In the present case, it is not in dispute that the show cause notice at Annexure-J came to be issued on 06.03.2024 at 17:10:02 hours. The time given for furnishing reply to the said notice was by 11:00 hours of 11.03.2024. No doubt, request for further time was made - 4 - NC: 2024:KHC:19106 WP No. 13159 of 2024 and the Department by its notice at Annexure-K granted further time for reply on or before 13.03.2024, 10.48 a.m. However, it must be noticed that the time prescribed as regards reply in case of assessment proceedings under Section 144-B as found in SOP at Clause N.1.3 is a period of 7 days from issuance of show cause notice. If that were to be so, the period of 7 days would expire on 17 hours 10 minutes on 13.03.2024 while time that is extended is only till 10.48 a.m. of 13.03.2024. 5. Taking note of the observations made by this Court in the case of Chowdapally Dattaprakash Ajay (supra) referred to above, petition deserves to be allowed and accordingly, assessment order dated 21.03.2024 at Annexure-A1, computation sheet at Annexure-A2, notice of demand at Annexure-A3, show cause notice for penalty at Annexure-A4 and the show cause notice for penalty at Annexure-A5, are set aside. The matter is remitted with a direction that the petitioner has to make out reply to the show cause notice at Annexure-J within a period of 7 days - 5 - NC: 2024:KHC:19106 WP No. 13159 of 2024 from the date of receipt of certified copy of this order. The department is to facilitate online filing of reply by taking appropriate steps. All contentions are kept open. 6. In light of the above, petition is disposed off. Sd/- JUDGE VP "