Karnataka High Court

Sri Shivalingappa Channabasappa ... vs The Principal Commissoner Of Income Tax ... on 27 June, 2024

Author: Pradeep Singh Yerur

Bench: Pradeep Singh Yerur

                                                         -1-
                                                                NC: 2024:KHC-D:8748
                                                                  WP No. 100314 of 2024




                                  IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
                                        DATED THIS THE 27TH DAY OF JUNE, 2024
                                                       BEFORE
                                    THE HON'BLE MR JUSTICE PRADEEP SINGH YERUR
                                      WRIT PETITION NO.100314 OF 2024 (T-IT)
                             BETWEEN:

                             SRI. SHIVALINGAPPA CHANNABASAPPA
                             KUMBAR S/O CHANNABASAPPA KUMBAR,
                             AGED ABOUT 45 YEARS,
                             AT POST BANKALAGI,
                             TQ: SINDAGI, DIST: VIJAYAPUR,
                             BANKALAGI-586128,
                             PAN: BBZPK6344J.
                                                                           ... PETITIONER
                             (BY SRI S.V. RAVI SHANKAR AND
                              SRI SHASHANK S. HEGDE, ADVOCATES)

                             AND:

                             1.   THE PRINCIPAL COMMISSIONER
                                  OF INCOME TAX, HUBLI,
                                  OFFICE OF THE PRINCIPAL
                                  COMMISSIONER OF INCOME TAX,
                                  C.R. BUILDING, NAVANAGAR,
                                  HUBBALLI-580025.
ASHPAK
KASHIMSA
MALAGALADINNI                2.   THE ASSISTANT DIRECTOR OF INCOME TAX,
Digitally signed by ASHPAK
                                  CPC, BANGALORE, R/BY INCOME TAX OFFICER,
KASHIMSA MALAGALADINNI
Location: HIGH COURT OF
KARNATAKA DHARWAD
                                  WARD-1 AND TPS, BIJAPUR-586101.
BENCH
Date: 2024.07.10 12:23:44
+0530
                                                                          ... RESPONDENTS
                             (BY SRI M. TIRUMALESH AND
                              SMT. ROOPA ANAVEKAR, ADVOCATES)

                                  THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
                             OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT OF
                             CERTIORARI OR A DIRECTION IN THE NATURE OF WRIT OF
                             CERTIORARI QUASHING THE ORDER UNDER SECTION 119(2)(B) OF
                             THE INCOME TAX ACT, 1961 (FOR SHORT 'THE ACT') DATED
                             31/05/2023    PASSED   BY    THE   RESPONDENT     NO.1   IN
                             ITBA/COM/F/17/2023-24/1053352909(1) FOR THE ASSESSMENT
                             YEAR 2017-18 (ANNEXURE-A) AND ETC.
                                 -2-
                                       NC: 2024:KHC-D:8748
                                          WP No. 100314 of 2024




     THIS PETITION COMING ON FOR ORDERS THIS DAY, THE

COURT MADE THE FOLLOWING:


                               ORDER

Heard learned counsel for the petitioner and learned

counsel Sri M.Thirumalesh representing for respondent-

Tax/Revenue Authorities.

2. This petition is filed by the petitioner seeking to

quash the order dated 31.05.2023 passed by the 1st

respondent vide Annexure-A and to quash the intimation

issued under Section 143(1)(a) of the Income Tax Act, 1961

(for short, 'the Act') dated 26.03.2019 vide Annexure-C and

seeking a writ of mandamus for a direction to respondents to

condone the delay in filing the revised return of income

dated 04.07.2019 for the assessment year 2017-18 and for

other consequential reliefs.

3. Petitioner is a Civil Contractor involved in the

business and profession for several years. For the

assessment year 2017-18, he achieved gross turnover to

Rs.2,20,20,000/- and accordingly calculated the income of

NC: 2024:KHC-D:8748

Rs.17,77,899/- on the 8% of gross turnover. The ITR Form-

4 was filed by the petitioner through its tax practitioner,

which requires the income on a presumptive basis and filed

the returns on the premise that the full income has been

offered to tax by paying the necessary taxes. While filing the

tax returns and filling the Form-3, details of audit, closing

balances of financials, details of turnovers, TDS, etc., were

not available with the tax practitioner hence, they were not

filed as on date it was required to file. This being the state of

affairs, CPC intimated the petitioner that it proposed to make

additions of the differences of turnover as income, same was

served on the tax practitioner.

4. The petitioner contends that it was not brought to

his notice. The petitioner contends that he was not aware of

the password and email of the filing portal belonging to the

tax practitioner and hence he was not aware and he was

unaware of the error committed, until the CPC processes the

return of income under Section 143(1) of the Act. On the

basis of processing of the returns of the income, there was

difference of turnover appearing in Form No.26AS of

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Rs.1,85,95,838/- as the income of petitioner and raised a

back breaking demand and raised a demand which is

effected and causing hardship to the petitioner.

Subsequently, petitioner filed revised return on 04.07.2019

instead of filing it within 31.03.2019 was the due date for

filing the revised return under Section 139(5) of the Act. The

petitioner filed application for condonation of delay before

the 1st respondent to condone the delay in filing the revised

return and accept the return with higher taxes. Respondent

No.1 without appreciating the circumstances under which the

condonation of delay was sought by the petitioner passed an

order rejecting the petition and declined to condone the

delay in filing the revision returns of income for the

assessment year 2017-18 vide order dated 31.05.2023,

which is questioned by the petitioner herein.

5. It is vehement contention of the learned counsel

for the petitioner that respondent No.1 could have

considered the application for condonation of delay on the

ground of genuine and unjust that would be caused to the

petitioner in view of the demand order which is excess and

NC: 2024:KHC-D:8748

ought to have condoned the delay rather than rejecting it.

Petitioner contends that provision of Section 119(2)(b) of the

Act contemplates that there is any genuine hardship to the

petitioner same could be condoned by the board. In the

present case, the respondent No.1 has rejected the

application for condonation of delay by holding that case

made out by the petitioner would not fall within the ambit of

genuine hardship on merits by quoting the several

judgments therein, including the Judgment in the case of

B.M.Malani Vs. Commissioner of Income Tax & Antr.

dated 01.10.2008, Civil Appeal No.5950 of 2008 (Arising

out of SLP (C) No.4091 of 2007).

6. In the present case, the petitioner has filed his

Income Tax returns, where the taxable income is shown, but

in view of certain difficulties, the entire details were not

furnished and he filed revised returns, which also shows the

taxable income to be the same amount as was the earlier

original returns. But there was a delay in filing the revised

returns. As contemplated in law, while considering the

application for delay no doubt, it is true that genuine reasons

NC: 2024:KHC-D:8748

have to be made out by the petitioner to show that unjust

hardship would be caused due to the act of the respondent

No.1 on which ground delay could be condoned and not on

frivolous and flimsy grounds as narrated in the impugned

order, which is acceptable. But in the present case, there is

no shortage of payment of tax by the petitioner by virtue of

original returns filed and so also the revised returns, except

for non-filing of the details as required under the Act and in

fact he contends that he has paid more while this Court

would not want to venture into the intricacies whether it is

paid less or more i.e., the domain of the respondent No.1.

The rejection of respondent No.1 for consideration of

condonation of delay, in my humble opinion, may not be

correct. In the present facts and circumstances of the case,

as there is a genuine undue unjust hardship that would be

caused to the petitioner. If delay is not condoned and further

proceedings could be assessed by the authorities by making

assessment, if any, afresh for calculation of any loss or

excess payment of tax for underpayment of tax this is of

course at the liberty of respondent.

NC: 2024:KHC-D:8748

7. Learned counsel for the respondents vehemently

contends that there is no illegality or arbitrariness in the

impugned order passed by the respondents, as it has taken

into consideration the judgment in the case of B.M.Malani

V/s. Commissioner of Income Tax and Anr., passed in

Civil Appeal No.5950/2008 and several other judgments as

stated in Annexure-A, nevertheless even in the said

judgment, what is prescribed is genuine hardship, if it is

caused, then the delay would be condoned.

8. In my opinion, there would be unjust and genuine

hardship that would be caused, if an authority comes to a

conclusion that there is under payment of taxes or less tax

paid. An opportunity deservers to be granted to the

petitioner, if there is minor delay which does not effect the

revenue. Hence, I pass the following:

ORDER

i) The petition is allowed.

ii) The impugned order passed by respondent

No.1 dated 31.5.2023 vide Annexure-A is

quashed. Thereby, the demand order made

NC: 2024:KHC-D:8748

under Section 143(1)(a) of the Income Tax

Act, 1961 vide Annexure-C would not hold

good as the same will have to be reconsidered.

iii) The writ of mandamus is issued to the

respondents to process the revised return of

income dated 04.07.2019 filed by the

petitioner for the assessment year 2017-2018,

in accordance with law.