VENKATESH CONSULTANTS PVT. LTD. vs. UNION OF INDIA AND ORS.

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WPA/1301/2022HC CalcuttaWBCHCA002835202227 January 2022Bench: HON'BLE JUSTICE MD. NIZAMUDDIN4 pages
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What did the High Court hold?

The High Court, while not deciding the merits of the writ petition, acknowledged that the appellant had made out a prima facie case for entertaining the writ petition. The Court noted that the department had not yet filed its affidavit-in-opposition despite the time granted by the learned Single Bench. To protect the assessee's interest and prevent the writ petition from becoming infructuous, the Court directed the department to file the affidavit-in-opposition within three weeks. The appellant was granted two weeks to file a reply. The Court also directed the department to maintain status quo and not proceed further with the reassessment proceedings initiated by the notice under Section 148 dated April 22, 2022, until the writ petition is heard and disposed of by the learned Single Bench. The Court clarified that it had not gone into the merits and parties could agitate all questions of fact and law before the Single Bench.

What were the facts?

The appellant, Kishore Kumar Mundhra, filed an intra-Court appeal against an order dated June 9, 2022, by a learned Single Bench of the Calcutta High Court. The appellant was aggrieved by the denial of an interim order pending the disposal of a writ petition. The writ petition challenged an order dated April 22, 2022, passed under Section 148A(d) of the Income Tax Act, 1961, on the grounds of limitation. The learned Single Bench had initially directed the department to file an affidavit-in-opposition within a specified time. However, the department had not yet filed its response. The appeal was filed to protect the assessee's interest, as the reassessment proceedings were set to continue.

What were the issues?

1. Whether the appellant made out a prima facie case for entertaining the writ petition challenging the order under Section 148A(d) of the Income Tax Act, 1961, on the grounds of limitation. Assessee's Contention: The assessee argued that the order under Section 148A(d) was barred by limitation, necessitating interim protection pending the writ petition's disposal. Revenue's Contention: The judgment does not record any specific arguments made by the revenue regarding the prima facie case or the limitation issue at this stage. However, the revenue was directed to file an affidavit-in-opposition.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148

AI-generated summary — verify with the full judgment below

Item No.8. IN THE HIGH COURT OF JUDICATURE AT CALCUTTA CIVIL APPELLATE JURISDICTION APPELLATE SIDE HEARD ON: 01.09.2022 DELIVERED ON:01.09.2022 CORAM: THE HON’BLE MR. JUSTICE T. S. SIVAGNANAM AND THE HON’BLE MR. JUSTICE PRASENJIT BISWAS

MAT 1301 of 2022 With I.A. No.CAN 1 of 2022

Kishore Kumar Mundhra. Vs. Union of India & ors. Appearance:- Mr. Suthirtha Das

….. for the appellant. Mr. Soumen Bhattacharya

…. for the respondents. JUDGMENT (Judgment of the Court was delivered by T.S. SIVAGNANAM, J.) 1. This intra Court appeal filed by the writ petitioner is directed against the order dated 9th June, 2022 in W.P.A. No.9478 of 2022. The appellant / writ petitioner is aggrieved on account

of not granting an interim order pending disposal of the writ petition. The writ petition had been filed challenging the order dated 22nd April, 2022 under Section 148A(d) of the Income Tax Act, 1961 (for short, “the Act”). The appellant / writ petitioner had challenged the said order on the ground that it is barred by limitation. The learned Single Bench was of the view that the appellant had made out a prima facie case for entertaining the writ petition and therefore, directed affidavit-in-opposition to be filed by the department within a time frame and reply to be filed by the appellant / writ petition thereafter. 2. Though such order was passed on 9th June, 2022, the respondents/department is yet to file their affidavit-in- opposition. We find that after the order impugned in the writ petition was passed under Section 148A(d) of the Act, notice under Section 148 has been issued on 22nd April, 2022 as a consequence of which, the assessing officer will proceed with the assessment proceedings, which is sought to be reopened. Taking note of the fact that though the learned Single Bench had granted four weeks time from 9th June, 2022 to file the affidavit-in-opposition, we are informed that till date the affidavit-in-opposition has not been filed and if that be so, 2

the department would not be justified in proceeding with the reassessment proceeding having not complied with the direction issued by the learned Single Bench. 3. Therefore, we are of the view that the interest of the assessee needs to be protected in the interregnum. Otherwise, the writ petition itself is liable to become infructutous when it is taken up for hearing. 4. In the light of the above, the appeal and the application stand disposed with a direction to the respondents / department to file their affidavit-in-opposition in the writ petition within three weeks from date. The appellant is granted two weeks time therefrom to file reply, if any. Thereafter, the matter shall be listed before the learned Single Bench for hearing, which subject to the convenience of the learned Single Bench shall be listed after eight weeks from date. 5. Till such time, the respondents / department are directed to maintain status quo and not to proceed further pursuant to the notice issued under Section 148 of the Act dated 22nd April, 2022. The appellant cannot raise the plea of limitation merely on the ground that such order has been passed granting interim protection to the appellant till the writ petition is heard and disposed of. 3

6.

However, this will not preclude the appellant from challenging the validity of the order passed under Section 148A(d) of the Act, which is impugned in the writ petition. We make it clear that we have not gone into the merits of the matter and the parties are at liberty to agitate all questions of fact and law before the learned Single Bench. 7. There shall be no order as to costs. 8. Urgent photostat certified copy of this order, if applied for, be furnished to the parties expeditiously upon compliance of all legal formalities.

(T.S. SIVAGNANAM, J) I agree,

(PRASENJIT BISWAS, J.) NAREN / PALLAB (AR.C) 4

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