Doulatram Chimandas Ramchandani vs Union Of India
2022 Latest Caselaw 7828 Raj

(1 of 7) [CW-7017/2022]

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

D.B. Civil Writ Petition No. 7017/2022

Doulatram Chimandas Ramchandani, House No. 634 KC Bhavan,

11Th B Road Sardarpura, Jodhpur, Rajasthan Through His Power

Of Attorney Holder Mr. Vineet Ramchandani S/o Lila Ram

Ramchandani, Aged About 32 Years, R/o House No. 634 KC

Bhavan, 11Th B Road Sardarpura, Jodhpur 342003

----Petitioner Versus

1. Union Of India, Through Secretary Finance, Ministry Of

Finance, North Block New Delhi 110001

2. Principal Chief Commissioner Of Income Tax (Nafac),

North Block, New Delhi 110001

3. Principal Commissioner Of Income Tax - 1St, Aayakar

Bhawan, Paota C Road, Jodhpur - 342010

4. I.T.O., Ward-1(1), Aaykar Bhawan Paota C Road, Jodhpur

342010

----Respondents

For Petitioner(s) : Mr. Sharad Kothari Mr. Mayank Tripathi For Respondent(s) : Mr. Kamal Kishore Bissa

HON'BLE MR. JUSTICE SANDEEP MEHTA HON'BLE MR. JUSTICE VINOD KUMAR BHARWANI

Order

25/05/2022

The petitioner has filed the instant writ petition for assailing

the order (Annexure-8) dated 29.04.2022 passed by the I.T.O. W-

1(1), Jodhpur, rejecting the objections submitted by the petitioner

to notice issued under Section 148-A(b) of the Income Tax Act

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dated 13.03.2022 by ignoring the reply submitted by the

petitioner.

Mr. Sharad Kothari, learned counsel representing the

petitioner, vehemently and fervently urged that the assessment in

original was made about 3 to 4 years ago and it was sought to be

reopened by the I.T.O. by taking recourse of Section 148-A(b) of

the Income Tax Act. Notice (Annexure-2) was purportedly issued

by the I.T.O. to the petitioner on 13.03.2022, giving time till

21.03.2022 to submit a response thereto electronically. The

annexure to the notice indicated that there was a transaction of

Rs.5,70,00,000/- in a bank account maintained at the Oriental

Bank of Commerce, E Block, Harsha Bhawan, Connaught Place,

New Delhi, Delhi India during the financial year 2017-18 and no

Income Tax Return was filed for the said transaction and thus, the

transaction remained unexplained. Mr. Kothari drew the Court's

attention to the copy of the dashboard of the income tax portal,

(forming a part of Annexure-2) as per which, no recipient has

been mentioned in the dashboard. With reference to the said

document, Mr. Kothari contended that the notice was never

transmitted electronically to the petitioner. He has also filed on

record, copy of the tracking consignment received from the post

office which indicates that the notice was also sent to the

petitioner through registered post. The item was booked on

17.03.2022 and was received at the petitioner's registered

address on 21.03.2022 at 17:58:15 hrs. Mr. Kothari submits that

by the time, said notice was received through post, the time

period for filing reply as prescribed in the notice had already

lapsed. Despite that, the petitioner, who is a NRI tried to collect all

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the relevant information and submitted reply/objection dated

29.03.2022 wherein, it was specifically mentioned that the

petitioner did not maintain the bank account mentioned in the

notice and requested for being provided with requisite bank

details/ time deposits. However, the said reply was not taken into

account and was expressly eschewed while passing the order

dated 30.03.2022 under clause (d) of Section 148-A of the Income

Tax Act which reads as below :-

"The SCN was issued on 13/03/2022 and duly served. The assessee's compliance was requested on or before the given date.

1. Reply of the assessee: It is noticed that the assessee did not make any compliance and failed to furnish any details/reply till the given date.

2. Analysis of the assessee' reply & finding of this office:

From the above facts it is clear that the assessee has failed to comply to the SCN and to furnish the requisite details and supporting documents in this regard. Therefore, it is presumed that the assessee has nothing to say/ no details or explanation to offer in respect of the information conveyed through SCN to the assessee and also mentioned in earlier para, which suggests that income chargeable to tax has escaped assessment within the meaning of section 147 of the Income-tax Act, 1961, in this case for the Assessment Year under consideration. As the assessee did not file any reply to the show-cause notice of this office, this office is left with only option to decide the case based on the material available on record."

Mr. Kothari submits that the observations made in the

impugned order are totally incorrect and unjustified and hence,

the impugned order is unsustainable in the eyes of law and should

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be quashed. In support of his arguments, Mr. Kothari placed

reliance on the Division Bench Judgment of Hon'ble the Bombay

High Court in the case of Pankaj Vs. National e-Assessment

Centre (Writ Petition No.1927/2021 decided on

19.01.2022).

Mr. Kothari further referred to Section 148-A(b) of the

Income Tax Act and urged that the period for filing reply to the

notice is required to be not less than seven days and not

exceeding thirty days from the date on which such notice is issued

or such time as may be extended by the I.T.O. on the basis of an

application filed in this behalf. Mr. Kothari submits that the

impugned order was passed without following the mandate of

Section 148-A of the Income Tax Act. The details of service of

notice under Section 148-A(b) of the Income Tax Act as reflected

in the impugned order are incorrect and as the order dated

29.4.2022 (Annex.8) has been passed by ignoring reply of the

petitioner, which had admittedly been received by the I.T.O., the

same is liable to be quashed as having been passed in sheer

violation of principles of fair play and natural justice.

In reply, the respondents have mentioned that the notice

dated 13.03.2022 was forwarded to the registered email ID :

[email protected] on 14.03.2022 and was served

on the same day. The hard copy of the show cause notice was

dispatched through post on 13.03.2022 and was timely delivered

at the petitioner's address. Mr. Bissa, learned counsel representing

the Department, urged that the notice (Annexure-2) dated

13.3.2022 was forwarded forthwith to the petitioner's Chartered

Accountant through email and thus, it can be presumed that

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knowledge thereof was received by the petitioner on 13.03.2022

itself. However, reply was filed beyond the period of seven days

stipulated in the notice (Annexure-2) dated 13.3.2022 and thus, it

was rightly ignored while passing the impugned order (Annexure-

6) dated 30.3.2022. He urges that the petitioner is not prejudiced

by the impugned order because he would have the opportunity to

contest the proceedings even now. However, Mr. Bissa is not in a

position to dispute that there is nothing on record to show that

there existed any relationship of professional nature or otherwise,

between the petitioner and the email addressee

[email protected] to whom, the notice (Annexure-

2) dated 13.3.2022 was sent electronically. Mr. Bissa was also not

in a position to dispute the fact that as per the track details of the

Post and Telegraph Department, which the petitioner has filed on

record with the writ petition, envelop containing hard copy of the

notice (Annexure-2) was served at the postal address of the

petitioner on 21.03.2022 which was last date stipulated for filing

the reply. Thus, we have no hesitation in holding that the notice

(Annexure-2) dated 13.3.2022 was not served to the petitioner in

time as claimed by the respondents.

It is thus abundantly clear that the mandate of Section 148-

A(b) of the Income Tax Act that the assessee shall be provided a

minimum of seven days and maximum of thirty days, which may

be extended by the I.T.O. for filing reply to the show cause notice,

was not complied with. Furthermore, annexure to the notice

(Annexure-2) indicates that the assessment was sought to be

reopened in respect of a suspicious transaction which took place in

a bank account maintained at the Oriental Bank of Commerce,

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Connaught Place, New Delhi, Delhi India Branch in the year 2017-

18. In the reply (Annexure-5) dated 29.3.2022, the petitioner,

pertinently asserted that he had no connection whatsoever with

the said bank account and sought details thereof so that proper

response could be filed. However, the I.T.O. expressly ignored the

reply of the petitioner and passed the impugned order (Annexure-

6) dated 30.3.2022, wrongly mentioning therein that the

petitioner did not file reply to the notice under Section 148-A(b) of

the Act. The said finding in the impugned order is factually

incorrect in view of the admitted material available on record. The

response to the notice was unquestionably submitted by the

petitioner within the timeline as provided under Section 148-A(b)

of the Income Tax Act and thus, there was no reason whatsoever

for the I.T.O. not to have provided the requisite details to the

petitioner. Had the account details be provided and if the

petitioner was able to establish that he had no connection with the

suspected bank account, manifestly, the subsequent proceedings

would not have been required. It is clear that the Income Tax

Authorities were trying to cover up the default on their part in not

having the notice served properly upon the petitioner.

Since the impugned order (Annexure-6) came to be passed

on 30.03.2022, there was no ostensible reason for the Tax

authorities to ignore the reply dated 29.3.2022 filed by the

petitioner.

As a consequence, the impugned order (Annexure-6) dated

30.03.2022, does not stand to scrutiny, as the same is absolutely

arbitrary and perverse and also suffers from the gross violation of

the fair play and principles of natural justice.

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                                        Consequently,      the     impugned          order      (Annexure-6)     dated

30.03.2022 is quashed and set aside. The Income Tax Officer shall

provide requisite details to the petitioner in terms of

communication (Annexure-5) dated 29.03.2022 provide him

proper opportunity to file detailed reply and shall thereafter,

proceed to pass a fresh reasoned order within a period of 15 days

thereafter. It is made clear that the bar of limitation applicable by

virtue of Section 153 of the Income Tax Act shall not come in way

of the Tax Authority in proceeding further if so required.

The writ petition is allowed in these terms.

(VINOD KUMAR BHARWANI),J (SANDEEP MEHTA),J

109-/Pramod/Devesh/-

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