Madras High Court
Pv.Gunasekaran vs Additional/Joint Deputy/ on 8 August, 2023
W.P.No.25777 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 08.08.2023
CORAM
THE HON'BLE MR.JUSTICE C.SARAVANAN
W.P.No.25777 of 2022
PV.Gunasekaran ... Petitioner
Vs.
1.Additional/Joint Deputy/
Assistant Commissioner of Income Tax/
Income Tax Officer,
National Faceless Assessment Centre,
Delhi.
2.The Income Tax Officer,
Ward 1 Tiruvallur,
Income Tax Office,
No.2, 1st Floor, Jawaharlal Nehru Road,
Tiruvallur, Tamil Nadu 602 001. ... Respondents
Prayer: Writ Petition filed under Article 226 of Constitution of India, for
issuance of a Writ of Certiorari, calling for the records contained in notice
dated 19.03.2021 bearing ITBA/AST/S/148/2020-21/1031618196(1) issued
by the 2nd respondent under Section 148 of the Income Tax Act, 1961 for AY
2017-18 for PAN:AAAFN4271G and all consequential notices, letters and
orders thereto, including order dated 26.03.2022 bearing
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W.P.No.25777 of 2022
ITBA/AST/S/147/2021-22/1041701959(1) issued by the 1st respondent and
to quash the same.
For Petitioner : Mr.r.Suhrith
For Respondents : Mr.Prabhu Mukunth
Arun Kumar &
Mr.B.Ramana Kumar
Senior Panel Counsel
ORDER
The petitioner is aggrieved by the impugned order dated 26.03.2022
bearing ITBA/AST/S/147/2021-22/1041701959(1) issued by the 1st
respondent and the impugned notice dated 19.03.2021 bearing
ITBA/AST/S/148/2020-21/1031618196(1) issued by the 2nd respondent under
Section 148 of the Income Tax Act, 1961 for AY 2017-18 for
PAN:AAAFN4271G.
2. Relevant portion of the impugned order reads as under:-
2. The assessee failed to file I.T Return for the AY
2017-18. In this case, the information available in
ITBA database(NMS) assessee has made investment
by purchase of time deposit to the tune of
Rs.14,00,000/- cash deposits of Rs.1,63,91,100/- and
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W.P.No.25777 of 2022
interest income of Rs.1,65,057/- in F.Y.2-2016-17
but failed to file the return of income declaring the
above transaction for the AY 2017-18. The quantum
of Rs.1,79,56,157/- is escaped assessment for the
A.Y 2017-18. Subsequently, the case was reopened
u/s.147 of the Income Tax Act and notice u/s 148
dated 19.03.2021 was issued and served. But there
was no record of filing return of income u/s.148 of
the I.T Act in the e-filing portal.
The penalty proceedings u/271F of the I.,T. Act is
initiated separately for non-filing of return of income.
Thereafter, notice u/.142(1) of the I.T.Act, 1961
dated 20.09.2021 and 31.01.2022 were issued and
served upon the assessee through e-mail. But the
assessee did not complied with non of the notices.
Again another letter dated 08.03.2022 was issued to
the assessee with a request to furnish relevant
submission as per the previous notices and also
mentioned that in case of further failure to comply
the assessment will be completed as best judgment
assessment u/s.144 of the I.T.Act. Again the assessee
failed to comply.
The Penalty proceedings u/s.272A(i)(d) of the
I.T.Act is initiated separately for non compliance.
Therefore, it can be resonate that there is no evidence
against the information of concealed income of
Rs.1,79,56,157/- by the assessee and the same is
added u/s 69A r/w Section 115BBE to the total
income and penalty proceedings u/s 271 AAC of the
I.T. Act is initiated separately for under reporting of
income in consequence to misreporting.
Considering the above, the total income is re-
computed as
under:-
Addition (Discussed above) Rs.1,79,56,157/-
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W.P.No.25777 of 2022
Assessed income Rs.1,79,56,157/-
Assessed u/s.144, 147 r/w Section 143(3A) &
143(3A) & 143(3B) of the Act, as above at
Rs.1,79,56,157/- Tax on assessed income is
computed as per separate sheet is an integral part of
this order. Copy of order, demand notice and notice
u/s.272A(1)(d)and 271AAC of the I.T.Act, 1961 are
issued to the assessee.
3. The petitioner claims to be a partner of Nirmala Manure Stores
which was engaged in the business of dealing with fertilizers. According to
the petitioner, the said partnership firm was constituted in the year 1972 with
two partners namely, petitioner and petitioner's father. The petitioner’s
father died on 18.01.2012 and thus the partnership stood dissolved on the
same day by operation of law.
4. It is the specific case of the petitioner that the petitioner had
intimated about the death of the petitioner's father, in his response dated
22.03.2022 to show cause notice dated 19.03.2022 issued under Section 144
of the Income Tax Act,1961. The first respondent has however passed the
impugned order without considering the reply.
5. That apart, it is submitted that after the death of the petitioner’s
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W.P.No.25777 of 2022
father, petitioner has carried on business of the firm in his individual capacity
and that the petitioner was being independently assessed to income tax with
his PAN No.AAIPG8037B. It is therefore submitted that the impugned order
that passed by invoking Section 141 and r/w 144 and 144(b) of the Income
Tax Act on 26.03.2022 was liable to be quashed.
6. Defending the impugned order, the learned Senior Standing Counsel
for the respondents would submit a notice dated 31.01.2022 was issued
under Section 142(1) of the Income Tax Act, 1961. The said notice was
followed by a show cause notice dated 19.01.2022 to which the petitioner has
only replied. It is submitted that the petitioner had however did not respond
to notice issued under Section 142(1) of the Income Tax Act on 31.01.2022.
7. It is further submitted that it was incumbent on the part of the
petitioner, to have complied with the requirements of Section 176(3) of the
Income Tax Act, 1961.
8. That apart, it is submitted that even in the reply, the petitioner has
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W.P.No.25777 of 2022
not given the particulars of the account details of the partnership firm and
information was gathered by the Income Tax Department in ITBA database
(NMS) as per which the assessee has made investment by purchase of time
deposits to the tune of Rs.14,00,000/-, had made cash deposits of
Rs.1,63,91,100/- and had earned interest income of Rs.1,65,057/- during the
Financial year 2016-17 and thus a clear was case made out that income had
escaped assessment for a sum of Rs.1,79,56,157/-during Assessment Year
2017-18.
9. That apart, it is submitted no returns of income was also filed under
Section 139 of the Income Tax Act and therefore the impugned order was
passed. It is therefore submitted that the impugned order does not call for
any interference.
10. I have considered the arguments advanced by the learned counsel
for the petitioner and the learned Senor Standing Counsel for the respondents.
11. No doubt there is a failure on the part of the petitioner to have
complied with the requirements of Section 176 of the Income Tax Act, 1961
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W.P.No.25777 of 2022
after partnership firm purportedly ceased to exist and discontinued with the
business. There is also a failure on the part of the petitioner to give in the
details of the account Nos. of the partnership firm while responding to the
show cause notice issued under Section 147 of the Act, vide reply dated
22.03.2022. However, the impugned order is bereft of details.
12. Before confirming the taxable income and the tax due, it was
incumbent for the respondent to have given detailed reasons. It merely states
that quantum of Rs.1,79,56,157/- had escaped assessment for the Assessment
Year 2017-18 and find faults with the petitioner for not giving proper details.
13. Considering the above, the impugned order is set aside and the
case is remitted back to the first respondent to pass a fresh order on merits as
expeditiously as possible. The petitioner shall file additional
reply/representation if any and upload the same together with the bank
details/documents that have been in use after the petitioner's father's death.
14. The petitioner shall also furnish the details of the assessment and
documents filed for assessment of his individual income for the relevant
assessment years. This exercise shall be carried out by the petitioner within
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W.P.No.25777 of 2022
four weeks from the date of receipt of this order or within such time as may
be given or extended by the first respondent.
15. The first respondent shall thereafter endeavour to pass a fresh
order on merits and in accordance with law after considering such
representation, if any, that may be filed by the petitioner. The petitioner shall
be heard in accordance with the procedure prescribed under Section 144B of
the Income Tax Act, 1961.
16. This writ petition stands disposed with the above observation. No
costs. Consequently, connected miscellaneous petitions are closed.
08.08..2023
Index : Yes/No
Internet : Yes/No
Neutral Citation : Yes/No
kkd
To
1.The Additional/Joint Deputy/
Assistant Commissioner of Income Tax/
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W.P.No.25777 of 2022
Income Tax Officer,
National Faceless Assessment Centre,
Delhi.
2.The Income Tax Officer,
Ward 1 Tiruvallur,
Income Tax Office,
No.2, 1st Floor, Jawaharlal Nehru Road,
Tiruvallur, Tamil Nadu 602 001
C.SARAVANAN, J.
kkd
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W.P.No.25777 of 2022
W.P.No.25777 of 2022
08.08.2023
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