SRI MANJUNATHA T V. PRINCIPAL COMMISSIONER OF INCOME TAX

WP/14582/2020

AI Insights

The case involves a writ petition filed by Sri. Manjunatha T. against the Principal Commissioner of Income Tax and the Assessing Officer, challenging a Best Judgment Assessment and a Demand Notice issued under the Income Tax Act, 1961. The petitioner contended that he was not properly served with the notices, which were sent to an incorrect email and an outdated physical address. The court found that the petitioner was indeed not given a reasonable opportunity to contest the assessment, which led to the decision to quash the assessment and the demand notice, and to restore the matter for reassessment.

• Counselvise Citation: [2020] 140 COUNSELVISE.COM (IT) 761142 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 23-12-2020
• Assessment Year: misc
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: GAUTAM BHARADWAJ
• Keywords: Best Judgment Assessment; Notice of demand; Reassessment; Capital Gain Scheme
• Section: 144; 156

Judgement Text

"IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 23RD DAY OF DECEMBER 2020 BEFORE THE HON’BLE MR. JUSTICE B. M. SHYAM PRASAD WRIT PETITION NO.14582/2020 (T/IT) BETWEEN : SRI. MANJUNATHA T. SON OF LATE THIMMAIAH H. N. AGED ABOUT 44 YEARS R/AT NO.154, 4TH CROSS RAILWAY LAYOUT, 2ND STAGE BANGALORE SOUTH, BENGALURU – 560 056. ... PETITIONER (BY SRI. GAUTAM S. BHARADWAJ., ADVOCATE) AND : 1. PRINCIPAL COMMISSIONER OF INCOME TAX 5TH FLOOR, BMTC COMPLEX, 6TH BLOCK, 80 FEET ROAD, KORAMANGALA, BENGALURU – 560 095. 2. THE ASSESSING OFFICER WARD3(2)(3), BMTC BUILDING 80 FEET ROAD, 6TH BLOCK NEAR KHB GAMES VILLAGE KORAMANGALA, BENGALURU – 560 095. ... RESPONDENTS (BY SRI.K.V. ARAVIND, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE 2 IMPUGNED ORDER DATED 21.10.2019 BEARING NO. ITBA/AST/S/144/2019-20/1019157116(1) PASSED BY THE ASSESSING OFFICER ANNEXED AS ANNEXURE ‘A’; QUASH THE NOTICE OF DEMAND DATED 21.10.2019 BEARING NO. ITBA/AST/S/156/2019-20/1019157181(1) PASSED BY THE ASSESSING OFFICER ANNEXED AS ANNEXURE ‘B’ THIS WRIT PETITION COMING ON FOR PRLIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: O R D E R The petitioner has filed this petition impugning the Best Judgment Assessment under Section 144 of Income Tax Act 1961 (for short, ‘the Act’) dated 21.10.2019 bearing No.ITBA/AST/S/144/2019-20/1019157116(1) vide Annexure – A and the subsequent Demand Notice under Section 156 of the Act dated 21.10.2019 in bearing No.ITBA/AST/S/156/2019-20/1019157181(1) vide Annexure-B. 2. The learned counsel for the petitioner submits that the impugned Best Judgment Assessment records that the petitioner is served with the notice but the petitioner has 3 not responded. However, the petitioner is not served with the notice. A physical copy of the notice is addressed to the petitioner’s earlier address and a soft copy of the notice is addressed to an incorrect Email address. The first respondent in arriving at the Best Judgment Assessment has considered the credit entry but not the corresponding debit entry. If the debit entry is considered, the petitioner would be entitled for the benefit under the prevailing Capital Gain Scheme without any further liability. 3. Sri K.V. Aravind, learned counsel for the respondent is unable to seriously controvert the submission that the petitioner is not served though he is emphatic that the second respondent has addressed the notice as per the details available with the authorities. If there is any change, the petitioner had to inform the authorities about the same in the next returns. 4 4. However, it remains indisputable that the petitioner did not have a reasonable opportunity before the second respondent, and it is possible that the petitioner could offer acceptable cause against the Best Judgment Assessment if an opportunity is given. Therefore, in the facts and circumstances of the case, and in the interest of justice, the impugned Best Judgment Assessment dated 21.10.2019 in No.ITBA/AST/S/144/2019-20/1019157116(1) and the Demand Notice dated 21.10.2019 in No.ITBA/AST/S/156/2019-20/1019157181(1) as per Annexures - A and B are quashed and the proceedings are restored to the second respondent for reassessment with opportunity to the petitioner. The petitioner shall appear before the second respondent without further notice on 18.01.2021. SD/- JUDGE SA/- Ct:sr "