Madras High Court
Jaffaorulla Syeaadunnishaa vs The Assistant Commissioner Of ... on 23 July, 2021
W.P(MD)No.1972 of 2020
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 23.07.2021
CORAM :
THE HONOURABLE MRS.JUSTICE J.NISHA BANU
W.P(MD)No.1972 of 2020
and
WMP(MD)Nos.1645 and 1646 of 2020
Jaffaorulla Syeaadunnishaa ... Petitioner
vs.
The Assistant Commissioner of Income Tax,
Income Tax Circle 2(1) Trichy,
3rd Floor, Trichy Main Building,
Williams Road, Cantonment,
Tiruchirappalli-620 001. ... Respondent
Petition filed under Article 226 of the Constitution of India, for
issuance of Writ of Certiorari, to call for the records of the respondent in
PAN BCCPS3685N vide Order
No.ITBA/AST/S/144/2019-20/1022967569(1) dated 24.12.2019 and
raised a demand under Section 156 of the Income Tax Act in
No.ITBA/AST/S/156/2019-20/1022967579(1) dated 24.12.2019 and
quash the same as ex-facie illegal, arbitrary, without jurisdiction and
against the principles of natural justice.
For Petitioner : Mr.K.Soundararajan
For Respondent : Mr.N.Dilip Kumar, Senior Standing Counsel
1/10
https://www.mhc.tn.gov.in/judis/
W.P(MD)No.1972 of 2020
ORDER
This writ petition has been filed for issuance of a Writ of
Certiorari, to call for the records of the respondent in PAN
BCCPS3685N vide Order No.ITBA/AST/S/144/2019-20/1022967569(1)
dated 24.12.2019 and raised a demand under Section 156 of the Income
Tax Act in No.ITBA/AST/S/156/2019-20/1022967579(1) dated
24.12.2019 and quash the same as ex-facie illegal, arbitrary, without
jurisdiction and against the principles of natural justice.
2.The petitioner is an authorised dealer for Royal Enfield
Motorcycles and for the assessment year 2017-18, the petitioner filed
return and the assessment has been completed. Subsequently, a notice
was issued by the Income Tax Officer, Cuddalore, on 10.08.2018 under
Section 143(2) of the Act and thereafter a notice under Section 142(1) of
the Act was issued on 21.10.2019 by the respondent. The petitioner filed
reply in part on 05.11.2019 and sought time for filing further details.
Again on 27.11.2019, further details were filed. Again on 30.11.2019,
entire details were filed. The respondent issued a show cause notice on
05.12.2019 seeking for the first time fresh details including the details
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W.P(MD)No.1972 of 2020
for the assessment year 2016-2017 even though the assessment year is
2017-18 and observed that the petitioner filed reply on 05.11.2019 only
and granted time upto 08.12.2019. According to the petitioner, even
though the Directorate of Income Tax(Systems) has directed the
Assessing Officers to grant time upto 29.12.2019 to the assessee for
submission of response in the barred scrutiny cases, the respondent
arbitrarily made the assessment on 24.12.2019 under Section 144 of the
Act and therefore, the petitioner has filed the present writ petition stating
that the impugned order has been passed against the principles of natural
justice and also against the circular issued by the Directorate of Income
Tax on 26.12.2019 in which it was informed that the facility for
electronic submission of documents shall be automatically closed on
29.12.2019.
3.The learned counsel for the petitioner would state that the
respondent has no jurisdiction to assess under e-proceedings when
admittedly Section 143(3A) of the Income Tax Act was amended with
effect from 01.04.2020 giving the right to make e-assessment
proceedings under Section 144 and therefore, the e-assessment order
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W.P(MD)No.1972 of 2020
passed by the respondent is bad in law. The learned counsel for the
petitioner would further state that the respondent has assessed the
income under the amended Section 115BBE of the Act when admittedly
the amendment came into effect on 01.04.2017 i.e., from the previous
year 2017-2018 i.e., from the assessment year 2018-2019 and not for the
assessment year 2017-2018. According to the petitioner, because of the
wrong application of the amended provision, huge liability was raised by
the respondent and the petitioner is put to great hardship and mental
agony and therefore, the petitioner is before this Court.
4.He would further state that even on similar occasion in W.P.No.
1178 and 1182 of 2020 dated 27.01.2020, the assessment orders made
without granting further time as requested by the assessee, were set aside
and the matter was remitted to the respondent for making de nova
assessment. Subsequently, the respondent in his proceedings dated
26.03.2021, has passed an order accepting the claim of the assessee and
therefore, the learned counsel for the petitioner would state that the
assessment orders passed by the respondent herein without giving
opportunity to the petitioner herein in spite of his request for
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W.P(MD)No.1972 of 2020
adjournment, is a clear violation of the principles of natural justice and
therefore, the impugned orders are liable to be set aside on the said
ground.
5.The learned Senior Standing Counsel for the respondent would
state that when there is an effective statutory appeal available to the
petitioner, he cannot bypass the same. He would further state that the
petitioner's case was selected for scrutiny through Computer Aided
Scrutiny Selection(CASS) in Income Tax Business Application Module
and a notice under Section 143(2) of the Act was issued on 10.08.2018
by the Income Tax Officer Ward-2, Cuddalore. On perusal of the return
of income filed by the petitioner, it is seen that the total income is more
than Rs.10 lakhs and hence the case was transferred to the Jurisdictional
Circle, Assistant Commissioner of Income Tax, Circle-2(1), Trichy,
Trichy Circle, who issued notice dated 21.10.2019 under Section 142(1)
through online calling for details in connection with the scrutiny
proceedings and the details about the cash deposits made during the
assessment year 2017-18 to be submitted on or before 05.11.2019
electronically. According to the respondent, the petitioner has
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W.P(MD)No.1972 of 2020
conveniently omitted to state whether she has filed the details on or
before 12.09.2019. The petitioner submitted some details on 05.11.2019,
27.11.2019 and 30.11.2019. Further, a notice was issued on 05.12.2019
calling for some details and explanations on or before 08.12.2019. He
would further state that the petitioner had not submitted the details as
called for in the notice dated 05.12.2019 and failed to discharge her onus
for the cash deposit of SBN noted to the tune of Rs.35,55,500/- and
unexplained investment under Section 69 of Rs.17,88,228/- totally Rs.
53,43,728/-. Hence, the above said amount of Rs.53,43,728/- under
Section 69A was assessed as per Section 115BBE and completed on
24.12.2019 under Section 144 of the Act i.e., best judgment assessment
and the impugned orders came to be passed.
6.Heard the learned counsel for the petitioner as well as the
learned Senior Standing Counsel for the respondent.
7.Perusal of record shows that the assessment order has been
passed on 24.12.2019 without granting time to the petitioner to file reply
as per the direction of the Directorate of Income Tax by granting time
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W.P(MD)No.1972 of 2020
upto 29.12.2019. The main contention raised in the counter is that the
petitioner had been given the longest opportunity from 09.08.2018 till
16.12.2019 and despite the same, she only attempted to protract the
proceedings. The petitioner had not co-operated with the department
and failed to respond to the notices under Sections 143(2) and 142(1)
and also not filed reply nor furnished evidence in response to the show
cause notice dated 05.12.2019. Since the petitioner has failed to
discharge her onus for the cash deposit of SBN noted to the tune of Rs.
35,55,500/- and unexplained investment under Section 69 of Rs.
17,88,228/- totally Rs.53,43,728/-, the above said amount of Rs.
53,43,728/- under Section 69A was assessed as per Section 115BBE and
completed on 24.12.2019 under Section 144 of the Act i.e., best
judgment assessment and the impugned orders came to be passed. The
said contention cannot be accepted for the simple reason that as per the
direction of the Directorate of Income Tax, the petitioner was not granted
time upto 29.12.2019.
8.This Court in similar matters cited by the petitioner where
assessment orders passed without granting further time, set aside the
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W.P(MD)No.1972 of 2020
assessment orders therein and remitted the matter to the authority
concerned for fresh consideration. Admittedly, here also, the petitioner
was not granted time and therefore, it is a case of violation of principles
of natural justice. No personal hearing was also granted. If atleast
personal hearing is granted to the petitioner, the petitioner would have
explained his case. Though the respondent has raised many other
contentions, since the impugned orders have been passed without
granting further time to the petitioner to file reply, without adverting to
the other merits of the case, only on the ground of violation of principles
of natural justice, I am inclined to set aside the impugned orders.
9.Accordingly, the impugned orders of the respondent in PAN
BCCPS3685N vide Order No.ITBA/AST/S/144/2019-20/1022967569(1)
dated 24.12.2019 and raised a demand under Section 156 of the Income
Tax Act in No.ITBA/AST/S/156/2019-20/1022967579(1) dated
24.12.2019 are set aside and the matter is remitted back to the
respondent to pass fresh order after giving opportunity to the petitioner
for making his detailed reply and after affording opportunity of personal
hearing, within a period of three months from the date of receipt of a
copy of this order.
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W.P(MD)No.1972 of 2020
10.With the above direction, this Writ Petition is allowed. No
costs. Consequently, connected miscellaneous petitions are closed.
Index : Yes / No
Internet : Yes / No
bala 23.07.2021
To
The Assistant Commissioner of Income Tax,
Income Tax Circle 2(1) Trichy,
3rd Floor, Trichy Main Building,
Williams Road, Cantonment,
Tiruchirappalli-620 001.
https://www.mhc.tn.gov.in/judis/
W.P(MD)No.1972 of 2020
J.NISHA BANU, J.
bala
ORDER MADE IN
W.P(MD)No.1972 of 2020
DATED : 23.07.2021
https://www.mhc.tn.gov.in/judis/
