ST. FRANCIS DE SALES EDUCATIONAL TRUST vs. THE INCOME TAX OFFICER (EXEMPTION)

The relevant facts for the determination of the writ petition are: the petitioner is a charitable institution. The petitioner’s assessment for the year 2015-16 was re-opened on the ground that there was a cash deposit in its bank accounts. The petitioner duly filed all responses to the various notices issued by the second respondent. Subsequently, Ext P1 show cause notice was issued to the petitioner on 17.03.2023, under Section 144B of the Income Tax Act, 1961, directing the petitioner to file its reply within three days. In fact, the notice was not served on the petitioner. When the petitioner saw Ext P1 on the web portal, they immediately filed Ext P2 request, on 21.03.2023, seeking enlargement of time by a week, to enable the petitioner to file its reply with the supporting documents. However, as the web portal of the respondents was closed, the petitioner was precluded from uploading its reply with the documents. Consequently, the petitioner filed Ext P4 grievance petition on 24.03.2023, which was perfunctorily rejected by the respondents vide Ext P6 response, stating that the assessment was completed on 22.03.2023. Nonetheless, when the petitioner received Ext P5 assessment order, it was revealed that Ext P6 assessment order was passed only on 27.03.2023 and not on 22.03.2023, that too with an usurious demand for Rs.79,00,000/-. The petitioner has not been granted a fair and reasonable opportunity to submit its reply to Ext P1 show cause notice, which is in total disregard to the rudimentary principles of natural justice, fair play and reasonableness. The action of the respondents is arbitrary and unjustifiable. Hence, the writ petition.

Heard; Sri. Joseph Markos, the learned Senior Counsel appearing for the petitioner and Sri. Christopher Abraham, the learned Standing Counsel appearing for the respondents.

Ext P1 show cause notice was issued by the respondents on 17.03.2023, directing the petitioner to submit its reply within three days. The petitioner diligently submitted Ext P2 application, seeking enlargement of time by one week, to enable them to submit the reply, which was turned down. Ext P4 grievance petition submitted by the petitioner was also rejected, by Ext P5 reply on the ground that Ext P6 assessment order was passed on 22.03.2023. Indisputably, Ext P6 was passed only on 27.03.2023. 5. Having considered the pleadings and materials on record, and after hearing the learned counsel for the parties, I have no hesitation to hold that the petitioner was not granted a reasonable and fair opportunity for submitting their reply and being heard. The respondents have acted in undue haste and in violation of the basis tenets of fair play, reasonableness and natural justice, as expected of an instrumentality. The action of the respondents warrants interference by this Court by exercising the plenary powers of this Court under Article 226 of the Constitution of India, notwithstanding the alternative statutory remedy available to the petitioner. Resultantly, I allow the writ petition as follows: (i) Ext P6 assessment order is set aside. (ii) Ext P1 show cause notice is re-opened, to enable the petitioner to submit its reply. (iii) The petitioner is granted 10 days’ time from the date of receipt of a certified copy of this judgment, to submit its reply to Ext P1 show cause notice with all the supporting materials. (iv) The respondents are directed to open their web portal to facilitate the petitioner to submit its reply along with the documents. (v) The respondents shall consider and dispose of Ext P1 show cause notice, after adverting to the reply submitted by the petitioner, in accordance with law and as expeditiously as possible, at any rate, within a period of three months from the date of receipt of a certified copy of this judgment, after affording the petitioner an opportunity of being heard. (vi) Until such time orders are passed as stated above, all further coercive proceedings as against the petitioner shall stand deferred. D C.S.DIAS,JUDGE DST/08.06.23 //// P.A.To Judge