DR MADHUKAR G ANGUR vs. THE COMMISSIONER OF INCOME TAX

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WP/2978/2023HC KarnatakaKAHC01006782202327 February 2024Author: S.R.KRISHNA KUMAR5 pages
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What did the High Court hold?

The High Court allowed the petition, setting aside the impugned assessment order dated 31.12.2021 and all consequential orders and notices. The matter was remitted back to the second respondent (Assistant Commissioner of Income Tax) for fresh consideration in accordance with law. The Court acknowledged the petitioner's assertion that his inability to submit a complete reply was due to bonafide reasons, unavoidable circumstances, and sufficient cause. Adopting a justice-oriented approach, the Court granted the petitioner one more opportunity to submit a detailed reply. All rival contentions between the petitioner, respondents, and impleading applicants, including issues of jurisdiction, were expressly kept open and no opinion was expressed on them. The operative direction was to set aside the order and remand the matter for fresh adjudication.

What were the facts?

The petitioner, Dr. Madhukar G Angur, filed a writ petition before the High Court of Karnataka seeking to set aside an assessment order dated 31.12.2021 passed by the Assistant Commissioner of Income Tax (R2) under Section 153 read with Section 144 of the Income Tax Act. The petitioner contended that due to ongoing litigation concerning the management of M/s. Alliance University, he was unable to submit a complete response and all necessary documents to the Assessing Officer. He requested an opportunity to resubmit his reply and for the Assessing Officer to reconsider his claim. The respondents argued that the petition lacked merit and that the petitioner had already preferred an appeal, making the writ petition not maintainable. The petitioner then offered to unconditionally withdraw the appeal filed before the appellate authority.

What were the issues?

1. Whether the High Court should entertain a writ petition challenging an assessment order when an appeal has already been filed before the appellate authority, and if so, under what circumstances? 2. Whether the petitioner's inability to submit a complete response to the Assessing Officer due to ongoing litigation constitutes sufficient cause for setting aside the assessment order and remitting the matter for fresh consideration? Assessee's Contentions: The petitioner argued that his failure to provide a complete response was due to bonafide reasons, unavoidable circumstances, and sufficient cause, specifically citing litigation related to the management of M/s. Alliance University. He sought an opportunity to submit a detailed response and have his claim reconsidered. Revenue's Contentions: The respondents contended that the writ petition had no merit and was liable to be dismissed. They further argued that the existence of a preferred appeal precluded the High Court from entertaining the writ petition.

Which sections of the Income-tax Act were involved?

Section 153,Section 144

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
- 1 - NC: 2024:KHC:8062 WP No. 2978 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27TH DAY OF FEBRUARY, 2024 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION No. 2978 OF 2023 (T-IT) BETWEEN: DR MADHUKAR G ANGUR AGED ABOUT 64 YEARS S/O LATE GUDAPPA NAGUR FLAT No.803 G BLOCK MANTRI ESPANA NEAR SAKRA WORLD HOSPITAL OUTER RING ROAD, KARIYAMMANA AGRAHARA BELLANDUR, BANGALORE - 560 103. …PETITIONER (BY SRI SHREEHARI KUTSA, ADVOCATE) AND: 1. THE COMMISSIONER OF INCOME TAX HMT BHAVAN GST COMMISSIONERATE BLOCK 59, HMT BHAVAN, 3RD FLOOR BALLARI ROAD DENA BANK COLONY, GANGANAGAR 59 DENA BANK COLONY, ARMANE NAGAR BENGALURU, KARNATAKA – 560 032. 2. THE ASSISTANT COMMISIONER OF INCOME TAX CENTRAL CIRCLE (2) (4), BANGALORE, HMT BHAVAN GST COMMISSIONERATE BLOCK 59, HMT BHAVAN, 3RD FLOOR, BALLARI ROAD DENA BANK COLONY, GANGANAGAR 59 DENA BANK COLONY, ARMANE NAGAR BENGALURU, KARNATAKA – 560 032. …RESPONDENTS (BY SRI E I SANMATHI, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSITITUTION OF INDIA PRAYING TO SET ASIDE THE ORDERS DATED 31.12.2021 PASSED BY THE R2 I.E., LD. ASSISTANT COMMISSIONER INCOME TAX, CNTRAL CIRCLE (2)(4), BANGALORE U/S 153 R.W.S 144 OF THE INCOME TAX ACT AND DIRECT THE R2 TO CONDUCT AN ENQUIRY Digitally signed by LAKSHMINARAYANA MURTHY RAJASHRI Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:8062 WP No. 2978 of 2023 AFRESH VALIDITY OF THE ORDER PASSED BY THE R2 WITH RESPECT TO THE ASSESSMENT ORDER PASSED BY THE R2. THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, THE COURT MADE THE FOLLOWING:

ORDER

In this petition, petitioner seeks quashing of the impugned assessment order at Annexure-B dated 31.12.2021 and for other reliefs.

2.

Heard learned counsel for the petitioner and learned counsel for respondents and perused the material on record.

3.

Learned counsel for the petitioner submits that because of the litigation between the petitioner and the impleading applicant, in relation to the management of M/s. Alliance University, the petitioner could not submit full / complete response along with all documents to respondent No.2 who has proceeded to pass the impugned order, aggrieved by which, the petitioner is before this Court by way of the present petition. It is submitted that if one more opportunity is provided, the petitioner would submit a detailed response / reply along with all documents before respondent No.2 who may be directed to re-consider the claim of the petitioner, in accordance with law. NC: 2024:KHC:8062

4.

Per contra, learned counsel for respondents submits that there is no merit in the petition and same is liable to be dismissed. It is also submitted that petitioner has preferred an appeal and as such, the question of entertaining the present petition before this Court would not arise in the facts and circumstances of the case.

5.

By way of reply, learned counsel for the petitioner submits that petitioner would unconditionally withdraw the appeal filed by him before the appellate authority.

6.

The submission of the learned counsel for the petitioner is placed on record.

7.

Learned counsel for the impleading applicant submits that in the event this Court were to set-aside the impugned order and remit the matter back the matter to the second respondent for re-consideration afresh, all rival contentions between petitioner and impleading applicant are to be kept open to be decided in the appropriate proceedings.

8.

In view of the above facts and circumstances of the case and the specific assertion on part of the petitioner that his inability and omission to submit the detailed / complete / total reply NC: 2024:KHC:8062 along with all documents to respondent No.2 was due to bonafide reasons, unavoidable circumstances and sufficient cause, without expressing any opinion on the merits / demerits of the rival contentions between the petitioner / respondents / impleading applicant and in order to provide one more opportunity in favour of the petitioner to submit the complete / total / detailed reply along with all documents, I deem it appropriate to adopt justice oriented approach and to set-aside the impugned assessment order at Annexure-B dated 31.12.2021 and remit the matter back to respondent No.2 for re-consideration afresh in accordance with law.

9.

In the result, I pass the following: ORDER (i) Petition is hereby allowed. (ii) Impugned assessment order at Annexure-B and all consequential orders, notices, etc., are hereby set aside. (iii) The matter is remitted back to second respondent for re-consideration afresh, consideration in accordance with law. NC: 2024:KHC:8062 (iv) All rival contentions between petitioner / respondents / impleading applicants including issues / questions regarding jurisdiction are kept open and no opinion is expressed on the same. JUDGE

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