Madras High Court
R.Rajasekaran vs The Additional Commissioner Of ... on 20 June, 2022
WP (MD) No.6287 of 2022
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 20.06.2022
CORAM
THE HONOURABLE MR. JUSTICE M.NIRMAL KUMAR
Writ Petition (MD) No.6287 of 2022
and
W.M.P.(MD)Nos.4906, 4907 & 8470 of 2022
R.Rajasekaran .. Petitioner
Versus
1.The Additional Commissioner of Income Tax,
Income Tax Department,
National E-Assessment Center,
Delhi.
2.The Joint Commissioner of Income Tax,
Range-2, Income Tax Department,
Trichy,
Tamil Nadu.
3.The Assessment Officer,
Ward-1, Income Tax Department,
Annavasal Road, Thirukokaranam,
Pudukkottai,
Tamil Nadu – 622 002. .. Respondents
Prayer :- Petition filed under Article 226 of the Constitution of India praying
for issuance of a Writ of Certiorarified Mandamus, to call for the records on
the file of the first respondent, vide Pan No.AGQPR6044K-
ITBA/AST/S/147/2021-22/1041156861(1), dated 21.03.2022, quash the same
as illegal and devoid of merits and direct the first respondent to redo the
assessment for the year 2016-17 after providing reasonable opportunities to
the petitioner, by following the due process of law.
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WP (MD) No.6287 of 2022
For Petitioner : Mr.Raja.Karthikeyan
For Respondents : Mr.N.Dilipkumar
Senior Standing Counsel
ORDER
The petitioner aggrieved against the assessment order passed under
Section 147 read with Section 144 read with Section 144-B of the Income Tax
Act [hereinafter referred to as ''the Act''], following the best judgment
assessment, had filed this Writ Petition.
2.The contention of the petitioner is that he earlier filed his return on
10.03.2017 for the assessment year 2016-2017. The return of the
petitioner/assessee was selected for limited scrutiny and an order under
Section 143(3) of the Act was passed on 29.10.2018, accepting the income tax
return by the petitioner. Thereafter, on 25.03.2021 a notice under Section 148
of the Act was issued and the same was served on the petitioner on the same
day by E-mail. Though the petitioner has filed return of income in response to
the notice under Section 148 of the Act, the same was not E-verified within the
due date. Hence, another notice under Section 142(1) of the Act was issued by
the third respondent on 26.10.2021, directing the petitioner to furnish the
information called for as per Annexure and on the points specified therein on
or before 10.11.2021 at 11.00 a.m. Thereafter, the first respondent issued a
notice dated 26.11.2021 under Section 142(1) of the Act. Since the assessment
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WP (MD) No.6287 of 2022
has been done in faceless manner, the petitioner immediately sent a reply
through the Web portal. Due to technical glitch, it cannot be uploaded.
Thereafter, again on 16.12.2021, a notice under Section 142(1) of the Act,
followed by another notices dated 28.12.2021 and 30.12.2021, was issued.
3.Thereafter, the petitioner attempted to send his reply through E-mail
on 01.01.2022, which cannot be done due to some technical defects.
Therefore, the petitioner had sent a reply by speed post on the same day to the
first respondent. Without considering the petitioner's reply, on 04.01.2022 the
third respondent directed him to furnish his response through E-filing portal.
Thereafter, the petitioner was served with the show cause notice, dated
16.03.2022, making certain claims. The petitioner immediately sent reply on
17.03.2022. However, the respondents failed to consider the same for the
reason that it has been received at the fag end of the Assessment Year and
hence, following the best judgment assessment under Section 144 of the Act,
the impugned order dated 21.03.2022, has been passed, which is impugned in
the present Writ Petition.
4.The learned counsel for the petitioner submits that from the above
narration, the Income Tax Department in a hasty manner, without giving
proper notice and considering the petitioner's reply and the difficulty faced by
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WP (MD) No.6287 of 2022
him in uploading the documents in the Web Portal, in violation of principal of
natural justice, has passed the impugned order and hence, the same has to be
set aside.
5.The third respondent filed counter affidavit. The learned Senior
Standing Counsel appearing for the respondents submits that the petitioner had
filed his return of income for the assessment year 2016-2017 on 10.03.2017,
admitting total income of Rs.9,98,920/-. The case of the petitioner/assessee
was selected for limited scrutiny under Computer Assisted Scrutiny Selection
[CASS] to verify source for the cash deposits made in his bank accounts. The
scrutiny assessment under Section 143(3) of the Act was completed on
29.10.2018, by accepting the income returned by the petitioner. Thereafter, it
was noticed that the petitioner had purchased an immovable property on
04.07.2014 at Chennai, which consists of land and building, for a sale
consideration of Rs.6,50,00,000/-, excluding registration charges and stamp
duty etc. As per Annexure 1-A of the sale deed, the value of the land is
Rs.4,00,00,000/- and the building has been valued at Rs.2,50,00,000/-. Further,
the petitioner had sold the property on 29.03.2016, for a sale consideration of
Rs.6,85,00,000/-. On verification of the sale deed, it was found that the value
of the land is mentioned as Rs.6,25,00,000/- and the building has been valued
at Rs.60,00,000/-. The value of the building was also certified by the Assistant
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WP (MD) No.6287 of 2022
Engineer (Building Inspection) as Rs.60,00,000/-. It is pertinent to note that
the time gap between the purchase and sale of the above said property was one
year and nine months only, whereas, the value of the building was reportedly
reduced by Rs.1.90 Crores i.e., 73.07%. Though the value of the building was
reportedly reduced by 73% within less than 2 years of time, no justification for
the same was given. Accordingly, the case of the petitioner was re-opened
under Section 147 of the Act and thereafter, a notice was issued under Section
148 of the Act. As per the existing guidelines, after issuance of notice under
Section 148 of the Act, the Jurisdictional Assessing Officer is required to issue
notice under Section 143(2) of the Act or notice under Section 142(1) of the
Act, as the case may be. In this case, though the petitioner has filed return of
income in response to the notice under Section 148 of the Act, the same could
not be E-verified within the due date. Since no valid return of income was
available, notice under Section 143(2) of the Act was not issued. Notice under
Section 142(1) of the Act was issued on 26.10.2021 and thereafter, the case
was transferred to the National Faceless Assessment Centre (NaFAC) for
completion of re-opened scrutiny assessment in faceless manner. On
23.11.2021, S.P.Ulagappan, Chartered Accountant, sent a WhatsApp Message
to the Jurisdictional Assessing Officer, which reads as follows:-
''For Rajendran Rajasekaran, after writing the
response to the notice, when continue is clicked, it is not
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WP (MD) No.6287 of 2022
working (15-16 Assessment and 16-17 Assessment)
PAN.AGQPR6044K. Repeated attempts made.''
The new E-filing portal of the Income Tax Department was launched on 7th
June 2021 and during initial period, some technical glitches reported.
Accordingly, the query was replied as under:
''There may be some technical issues. Please wait
for few days and then try again. In case the issue
continues, you may lodge a complaint by email.''
6.The learned Senior Standing Counsel further submits that the
petitioner vide his E-mail, dated 01.01.2022, informed to the Jurisdictional
Assessing Officer that he was unable to respond through I.T. Portal. The
petitioner without furnishing any evidence to the Jurisdictional Assessing
Officer, stated that he has raised grievance in the portal to DIT (System) on
17.12.2021 and the same was not resolved. The petitioner uploaded the
documents as attachments to the E-mail sent to the Jurisdictional Assessing
Officer stating that the same may be treated as response to the notice. Since
the assessment was pending before the National Faceless Assessment Centre,
the E-mail sent to the Jurisdictional Assessing Officer cannot be treated as
response to the notices.
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WP (MD) No.6287 of 2022
7.The learned Senior Standing Counsel also submits that a show cause
notice dated 16.03.2022, was issued to the petitioner giving one more
opportunity for furnishing his explanation along with documentary evidence.
The petitioner requested 10 days' time on 17.03.2022 for furnishing details.
However, the said request was not considered as the assessment was getting
barred by limitation of time on 31.03.2022. The Faceless Assessing Officer
had considered the claim of the petitioner that the value of the building was
reduced because of Chennai flood in 2015. Hence, the claim of the petitioner
was not accepted as the same was not supported with any documentary
evidences.
8.Considering the above said rival submissions and on perusal of the
materials, it is seen that the petitioner had attempted to send a reply through
the Web Portal, which could not be transmitted due to some technical glitches.
Thereafter, the petitioner had sent his explanation, which was not accepted and
therefore, the petitioner was served with notice, for which, he had sent a reply
on 17.03.2022, seeking 10 days' time to furnish further submissions and
documents. The reason given by the Assessing Officer that the assessment
was getting barred by limitation of time and further time cannot be given, is
unjustifiable and improper. Hence, this Court finds that the action on the part
of the authorities in refusing to give time to the petitioner for submitting
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WP (MD) No.6287 of 2022
further documents, is improper. In view of the same, this Court is inclined to
set aside the impugned order of the first respondent, dated 21.03.2022.
Accordingly, it is set aside. The petitioner is directed to submit his reply along
with supporting documents, within a period of two weeks from the date of
receipt of a copy of this order. Thereafter, the respondents shall pass
appropriate orders by following the procedures as contemplated under the Act,
on merits and in accordance with law.
9.This Writ Petition is disposed of accordingly. No costs.
Consequently, connected Miscellaneous Petitions are closed.
20.06.2022
Index : Yes/No
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WP (MD) No.6287 of 2022
To
1.The Additional Commissioner of Income Tax,
Income Tax Department,
National E-Assessment Center,
Delhi.
2.The Joint Commissioner of Income Tax,
Range-2, Income Tax Department,
Trichy,
Tamil Nadu.
3.The Assessment Officer,
Ward-1, Income Tax Department,
Annavasal Road, Thirukokaranam,
Pudukkottai,
Tamil Nadu – 622 002.
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WP (MD) No.6287 of 2022
M.NIRMAL KUMAR, J.
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WP (MD) No.6287 of 2022
20.06.2022
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