MAHAMAAD VASIM vs. COMMISSIONER OF INCOME TAX (APPEALS)

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WP/15161/2024HC KarnatakaKAHC01028433202403 July 2024Bench: S SUNIL DUTT YADAV4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the assessment order dated 03.03.2023 was in violation of the principles of natural justice. The court noted that the notice under Section 142(1) was issued on 24.11.2022, but served on the assessee on 29.11.2022, with a demand for a reply by 30.11.2022. This afforded insufficient time for the assessee to respond. Considering the plea of the petitioner regarding his father's medical ailment, the court found it appropriate to set aside the impugned proceedings. The matter was remitted back to the stage of the reply to the notice under Section 142(1). All contentions were kept open. The petitioner was directed to file his reply within one month from the date of receipt of the certified copy of the order and upload it to the portal. The writ petition was disposed of accordingly.

What were the facts?

The petitioner, Mahamaad Vasim, filed a writ petition challenging an assessment order dated 03.03.2023, passed by the Income Tax Officer (Respondent No. 3). The petitioner contended that he was unable to participate in the assessment proceedings due to his father's cancer diagnosis. A notice under Section 142(1) of the Income Tax Act, 1961, was issued on 24.11.2022, requiring a reply by 30.11.2022. However, the petitioner claims this notice was served only on 29.11.2022, leaving insufficient time to respond. The High Court noted that the impugned order itself indicated service on 29.11.2022. The petitioner also filed an undertaking to withdraw an appeal pending before the First Appellate Authority.

What were the issues?

1. Whether the assessment order dated 03.03.2023, passed by the Income Tax Officer, is liable to be quashed on the grounds of violation of principles of natural justice due to insufficient time provided to the assessee to respond to a notice under Section 142(1) of the Income Tax Act, 1961? Assessee's Contentions: The petitioner argued that the notice under Section 142(1) was served on 29.11.2022, with a compliance deadline of 30.11.2022. This provided only one day for a response, which is insufficient and violates the principles of natural justice. The petitioner also cited his father's medical ailment as a reason for his inability to participate effectively. The petitioner undertook to withdraw the appeal pending before the First Appellate Authority. Revenue's Contentions: The judgment does not record any specific contentions from the revenue. However, the court's observation that the impugned order indicated service on 29.11.2022 implies the revenue's position was based on the assessment order.

Which sections of the Income-tax Act were involved?

Section 142(1)

AI-generated summary — verify with the full judgment below

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NC: 2024:KHC:25041 WP No. 15161 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF JULY, 2024 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 15161 OF 2024 (T-IT) BETWEEN: 1. MAHAMAAD VASIM AGE: 28 YRS, S/O LATE MAHAMAD SHAFI, BANTENAHALLI VILLAGE AND POST, BELUR, HASSAN TALUK, HASSAN DISTRICT - 573 115. … PETITIONER (BY SRI. MAHESH R UPPIN., ADVOCATE) AND: 1. COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, ROOM NO. 356, C R BUILDING, I P ESTATE, NEW DELHI - 110 002. 2. ASSESSING OFFICER NATIONAL FACELESS ASSESSMENT CENTER, DELHI - 110 002 3. INCOME TAX OFFICER WARD - 1 AND TPS, AAYAKAR BHAVAN, 2ND STAGE, BELUR ROAD, HASSAN - 573 201. … RESPONDENTS (BY SRI. M. THIRUMALESH., ADVOCATE) Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA

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NC: 2024:KHC:25041 WP No. 15161 of 2024

THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ASSESSMENT ORDER DTD 03.03.2023 PASSED IN ORDER NO.ITBA/AST/S/147/2022-23/1050349555(1) PASSED BY THE R3 MARKED AS ANNEXURE-B AND ETC.

THIS PETITION COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING: ORDER

Petitioner has called in question the validity of the assessment order at Annexure-B dated 03.03.2023. 2. The contention of the petitioner is that during the relevant point of time, petitioner’s father was diagnosed with cancer as is evidenced at Annexure-A and accordingly, the petitioner was unable to participate in the proceedings and put forth his stand. It is further submitted that the perusal of the order at Annexure-B at Paragraph No.2 would indicate that the notice under Section 142(1) of the Income Tax Act, 1961 (for short 'the Act') was issued on 24.11.2022 for compliance by way of reply on or before 30.11.2022, which admittedly was communicated only on 29.11.2022. Accordingly, it is submitted that when the notice was served on 29.11.2022, insistence of

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NC: 2024:KHC:25041 WP No. 15161 of 2024 making out reply by 30.11.2022 was clearly in violation of the principles of natural justice as sufficient time ought to have been afforded. 3. Heard both sides. 4. It is noticed that the date of notice under Section 142(1) of the Act is 24.11.2022. The observation made at Paragraph No.2 of the impugned order would indicate that the notice was duly served on the assessee on 29.11.2022. If that were to be so, seeking for response by 30.11.2022 is clearly affording insufficient time and the order passed thereupon could clearly be construed to be in violation of the principles of natural justice. 5. Taking note of the plea of medical ailment of the petitioner’s father during the relevant period of time, it would be an appropriate case for setting aside the impugned proceedings and remitting the matter back to the stage of reply to the notice under Section 142(1) of the Act.

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NC: 2024:KHC:25041 WP No. 15161 of 2024 6. The memo filed by the learned counsel for the petitioner giving an undertaking that the petitioner would withdraw the appeal pending before the First Appellate Authority, is taken on record. 7. Accordingly, the order at Annexure-B is set aside and the matter is relegated to the stage of reply to the notice under Section 142(1) of the Act. All contentions are kept open. Petitioner has to make out his reply to the notice under Section 142(1) of the Act within a period of one month from the date of receipt of certified copy of this order. Petitioner to also upload the order in portal. 8. Writ petition is disposed off accordingly.

Sd/- JUDGE VP

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