Delhi High Court
M/S Ester Industries Ltd vs The Asstt. Commissioner Of Income ... on 27 May, 2022
$~1
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 6861/2022
M/S ESTER INDUSTRIES LTD ..... Petitioner
Through: Mr. R. Santhanam, Advocate with Mr.
Arjun Prasad Sinha, Advocate.
versus
THE ASSTT. COMMISSIONER OF INCOME TAX & ANR.
..... Respondents
Through: Mr. Zoheb Hossain, Senior Standing
Counsel for Revenue with Mr. Vipul
Agrawal, Mr. Parth Semwal and Mr.
Aditya Chhajed, Advocates.
% Date of Decision: 27th May, 2022
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA
JUDGMENT
MANMEET PRITAM SINGH ARORA, J:(ORAL)
CM APPL. 20872/2022
Exemption allowed, subject to all just exceptions.
Accordingly, the application stands disposed of.
W.P.(C) 6861/2022 & CM APPL. 20873/2022
1. Present writ petition has been filed challenging order dated 31 st
March, 2022 passed under Section 148A(d) of the Income Tax Act, 1961
(hereinafter referred to as the 'Act') and notice dated 31st March, 2022
Signature Not Verified
Digitally Signed By:PRAMOD
Signing Date:03.06.2022
18:30:52
issued under Section 148 of the Act for the Assessment Year 2018-19 by the
respondent.
2. Learned counsel for the petitioner states that show cause notice under
Section 148A(b) of the Act was issued to the petitioner on 17 th March, 2022
and the petitioner was directed to file its reply by 24th March, 2022. The
said notice and the reply were handed over by the petitioner at the hearing
dated 2nd May, 2022 and were taken on record.
3. Learned counsel for the petitioner states that an application for
adjournment was filed by the petitioner on 24th March, 2022 seeking
extension of time to file a reply to the said notice. In the request, it was
stated that since the petitioner company is listed on the stock exchange, it
was then working to complete its statutory compliances scheduled to be
completed before 31st March, 2022. In the said request, it was further stated
that since the past financial records of the petitioner are stored in a factory in
Uttarakhand, the petitioner required additional time to collate the said
financial records.
4. The petitioner submits that, however, that though the request for
extension was duly registered on the online portal, the respondent has
proceeded to pass the impugned order under Section 148A(d) of the Act
wherein at paragraph No. 4, the order erroneously records that the petitioner
has filed a reply which has been found to be devoid of merit. The petitioner
submits that it is ex-facie contrary to request for adjournment sought vide
letter dated 24th March, 2022. He further contends that the impugned order
and the notice under Section 148 of the Act has been passed in violation of
principles of natural justice.
5. Issue notice. Mr Zoheb Hossain, learned Senior Standing Counsel for
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Digitally Signed By:PRAMOD
Signing Date:03.06.2022
18:30:52
respondent, accepts notice. He states that just because an adjournment
application has been filed, the petitioner could not have presumed that the
adjournment would be allowed. He further states that the request for
adjournment was made on 24th March, 2022 which was admittedly the last
date.
6. Having heard learned counsel for the parties, this Court is of the view
that the petitioner/assessee has the right to get adequate time in accordance
with the Act to submit its reply. It is pertinent to mention that Section
148A(b) permits the Assessing Officer to suo moto provide up to thirty
day's period to an assessee to respond to the show cause notice issued under
Section 148A(b), which period may in fact be further extended upon an
application made by the Assessee in this behalf, and such period given to the
petitioner-assessee is excluded in computing the period of limitation for
issuance of notice under Section 148A(d) of the Act in terms of the third
proviso to Section 149 of the Act.
7. In the present case, though the petitioner had filed an application for
adjournment immediately after receipt of notice dated 17th March, 2022, the
respondent had neither rejected the request for adjournment nor directed the
petitioner to file a reply within the original stipulated time.
8. By denying an opportunity of adequate time to the petitioner, the
mandate of Section 148A(b) has been violated. This Court in the Divya
Capital One Private Limited (earlier known as Divya Portfolio Private
Limited) vs. Assistant Commissioner of Income Tax Circle 7(1) Delhi &
Anr. in W.P.(C) 7406/2022 has observed as under:
"13. It is pertinent to mention that Section 148A(b) permits the
Assessing Officer to suo moto provide up to thirty days period to an
assessee to respond to the show cause notice issued under Section
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Digitally Signed By:PRAMOD
Signing Date:03.06.2022
18:30:52
148A(b), which period may in fact be further extended upon an
application made by the Assessee in this behalf, and such period
given to the assessee is excluded in computing the period of
limitation for issuance of notice under Section 148 of the Act in
terms of the third proviso to Section 149 of the Act."
9. Consequently, the impugned order dated 31 st March, 2022 issued
under Section 148A(d) of the Act and the notice dated 31 st March, 2022
issued under Section 148 of the Act are set aside.
10. The petitioner is directed to file its reply within a period of 02 (two)
weeks.
11. The respondent is directed to open the e-portal to enable the petitioner
to upload its reply. In the event, the Assessing Officer wants clarification or
would like the petitioner's response to any specific information received by
the revenue, it shall be open to give a supplementary notice. The respondent
is directed to pass a reasoned order within 08 (eight) weeks after duly
considering the reply filed by the respondent. This Court clarifies that it has
not commented on the merits of the controversy. The rights and contentions
of all the parties are left open.
12. With the aforesaid direction, the present writ petition along with
pending applications stands disposed of.
MANMEET PRITAM SINGH ARORA, J
MANMOHAN, J
MAY 27, 2022/msh
Signature Not Verified
Digitally Signed By:PRAMOD
Signing Date:03.06.2022
18:30:52
