FIDELITY INFORMATION SERVICES INDIA PRIVATE LTD vs. COMMISSIONER OF INCOME TAX -1 CHANDIGARH AND ANR

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CWP/2334/2020HC Punjab & HaryanaPHHC01010662202006 February 2020Author: MR. JUSTICE AJAY TEWARI,MR. JUSTICE AVNEESH JHINGAN2 pages
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What did the High Court hold?

The High Court disposed of the writ petition with a clarification. The Court noted the respondents' submission that the impugned order was wrongly characterized as a draft order and was, in fact, an assessment under Section 143(3). The respondents accepted the petitioner's contention that they should be at liberty to challenge any subsequent order and take all pleas before the appropriate authority. Therefore, the Court held that the petitioner would be at liberty to challenge any subsequent order that may be passed and to raise all available pleas before the appropriate authority. The Court did not decide on the merits of the original draft assessment order or the alleged mischaracterization, but rather provided a procedural path forward for the petitioner.

What were the facts?

The petitioner, Fidelity Information Services India Private Limited, filed a writ petition under Articles 226/227 of the Constitution of India seeking to quash a draft assessment order dated December 28, 2019, issued under Section 144C(1) of the Income Tax Act for assessment year 2016-17. The respondents are the Commissioner of Income Tax-1, Chandigarh, and another authority. On a previous date, the respondents' counsel stated that the impugned order was wrongly mentioned as a draft order and was actually an assessment order under Section 143(3) of the Income Tax Act, 1961. The respondents indicated they were in the process of rectifying this. The petitioner's counsel argued that the order could not be converted to a Section 143(3) order and that any rectification must be legally sound.

What were the issues?

1. Whether the impugned order, stated to be a draft assessment order under Section 144C(1) of the Income Tax Act, can be treated as a final assessment order under Section 143(3) of the Income Tax Act, 1961, and if so, whether the petitioner can challenge any subsequent rectification. Assessee's Contentions: The petitioner argued that the order, being a draft assessment order under Section 144C(1), cannot be converted into an order under Section 143(3). They further contended that the order cannot be rectified and that they should be permitted to challenge any rectification that is not borne out by law. Revenue's Contentions: The respondents initially stated that the impugned order was wrongly mentioned as a draft order and was actually an assessment under Section 143(3). They reiterated this position and stated that the Department was in the process of doing the needful. The respondents accepted the petitioner's offer to challenge any subsequent order.

Which sections of the Income-tax Act were involved?

Section 144C(1),Section 143(3)

AI-generated summary — verify with the full judgment below

CWP-2334-2020 (O&M) 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-2334-2020 (O&M) Date of Decision : 6.2.2020 Fidelity Information Services India Private Limited

...... Petitioner Versus Commissioner of Income Tax-1, Chandigarh and another ..... Respondents CORAM : HON'BLE MR.JUSTICE AJAY TEWARI : HON'BLE MR.JUSTICE AVNEESH JHINGAN *** Present : Mr. Akshay Bhan, Senior Advocate with Mr. Amandeep Singh, Advocate for the petitioner. Mr. Yogesh Putney, Senior Standing counsel Mr. Ajiteshwar Singh, Advocate for the respondents. *** AJAY TEWARI, J. (Oral)

1.

This writ petition has been filed under Articles 226/227 of the Constitution of India for issuance of a writ in the nature of certiorari for quashing the impugned draft assessment order under Section 144C (1) of the Income Tax Act (for short 'the Act') dated 28.12.2019 for assessment year 2016-17 (Annexure P-5) issued by respondent No.2. 2. On the last date the following order was passed :- “Notice of motion. On asking of the Court, Mr. Yogesh Putney, Senior Standing Counsel who is present in Court accepts notice on behalf of the respondents. Copy of paper book is supplied to the counsel for the respondents. Learned counsel for the respondents submits ANURADHA 2020.02.11 16:53 I attest to the accuracy and integrity of this document

CWP-2334-2020 (O&M) 2 that he has instructions that in the impugned order it has wrongly been mentioned that its a draft order but actually its an assessment under Section 143 (3) of the Income Tax Act 1961. Adjourned to 06.02.2020.”

3.

Today, learned Senior Standing counsel for the respondents has again reiterated the same. He has stated that the Department is in process of doing the needful. Learned Senior counsel for the petitioner has countered by arguing that this order cannot be converted into an order under Section 143 (3) of the Act. He has further argued that this order cannot be rectified and it should also be open to them to challenge in case any rectification which is not borne out by law is made.

4.

Learned Senior Standing counsel for the respondent has accepted this offer.

5.

Resultanly, the present writ petition is disposed of with the clarification that the petitioner would be at liberty to challenge any subsequent order which may be passed and take all pleas before the appropriate authority.

6.

Since the main case has been decided, the pending application, if any, also stands disposed of.

(AJAY TEWARI)

JUDGE (AVNEESH JHINGAN) JUDGE 6.2.2020 anuradha

Whether speaking/reasoned - Yes/No Whether reportable - Yes/No ANURADHA 2020.02.11 16:53 I attest to the accuracy and integrity of this document

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