Karnataka High Court
Sri. S S Sathyamurthy (Huf) vs Assistant Commissioner Of Income ... on 13 July, 2023
Bench: S.Sunil Dutt Yadav
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NC: 2023:KHC:24398
WP No. 10632 of 2023
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 13TH DAY OF JULY, 2023
BEFORE
THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV
WRIT PETITION NO. 10632 OF 2023 (T-IT)
BETWEEN:
1. SRI. S S SATHYAMURTHY (HUF)
S/O S.N. SHIVASHANKAR,
AGED 55 YEARS,
R/AT NO.11, 1ST CROSS,
2ND STAGE, NEAR SHANKARMUTT,
BASAVESHWARANAGAR,
BENGALORE-560 079.
REP. BY ITS KARTHA
SRI.S.S. SATHYAMURTHY
... PETITIONER
(BY SRI. ARAVIND V CHAVAN., ADVOCATE)
AND:
1. ASSISTANT COMMISSIONER OF INCOME TAX
CENTRAL CIRCLE-2(1),
Digitally signed C.R.BUILDING,
by VIDYA G R QUEENS ROAD,
Location: High BANGALORE-560 001.
Court of
Karnataka 2. PRINCIPAL COMMISSIONER OF INCOME TAX
CENTRAL CIRCLE,
C.R. BUILDING,
QUEENS ROAD,
BANGALORE-560 001,
... RESPONDENTS
(BY SRI. M. DILIP, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO
QUASH THE PENALTY ORDER DATED 26.09.2022 BEARING
NO.ITBA/PNL/F/270A/2022-23/1045977950(1) ANNEXURE-H2
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NC: 2023:KHC:24398
WP No. 10632 of 2023
FOR THE ASSESSMENT YEAR 2017-18 PASSED BY THE R3 AND
QUASH THE ASSESSMENT ORDER DATED 18.03.2022 BEARING
NO. ITBA/AST/M/153C/2021-22/1041017600(1) ANNEXURE-C
FOR THE ASSESSMENT YEAR 2017-18 PASSED BY THE R3 AND
ETC.
THIS WRIT PETITION COMING ON FOR ORDERS, THIS
DAY, THE COURT MADE THE FOLLOWING:
ORDER
Sri M. Dilip, learned counsel accepts notice for the
respondents.
2. The petitioner has challenged the Penalty Order
at Annexure-H2 dated 26.09.2022 for the Assessment
Year 2017-2018 and has also sought for setting aside of
the Assessment Order at Annexure-C dated 18.03.2022.
3. It is the contention of learned counsel for the
petitioner that the impugned order passed including the
Penalty Order under Section 270A of the Income Tax Act,
1961 ('the Act') is without affording mandatory hearing in
terms of the legal requirements under Section 274(1) of
the Act and also insofar as the Assessment Order passed
under Section 143(3) read with Section 153C of the Act,
NC: 2023:KHC:24398
WP No. 10632 of 2023
the opportunity of hearing as is provided for under Section
143(3) of the Act was not given. It is also contended that
the Authority had no jurisdiction to invoke Section 153C of
the Act.
4. It is pointed out that for the purpose of
initiating proceedings, there must be recovery of
incriminatory material without which recourse cannot be
had to Section 153C of the Act and that the only option
available under such circumstance would be to proceed for
reassessment under Sections 147 to 148 of the Act.
Reliance is placed on the judgment in the case of
Principal Commissioner of Income Tax v. Abhisar
Buildwell Private Limited - 2023 SCC Online SC 481.
5. Admittedly, there has been violation of
principles of natural justice. Accordingly, case is made out
for remanding the matter for fresh consideration while
directing the Authority to embark upon reconsideration
including the contentions raised regarding Section 153C of
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WP No. 10632 of 2023
the Act with reference to the law laid down by the Apex
Court in the case of Abhisar Buildwell (supra).
6. The Penalty Order at Annexure-'H2' and the
Assessment Order at Annexure-'C' in Writ Petition are set
aside. The Authority to reconsider the matter in light of
the discussion made above. The respondent is directed to
fix a date for hearing and afford an opportunity of personal
hearing as mandated under law as noticed above and pass
orders afresh.
Writ petition is allowed accordingly.
Sd/-
JUDGE
VGR
