EYGBS INDIA LLP vs. ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER

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WP/23812/2023HC KarnatakaKAHC01055795202302 November 2023Bench: B M SHYAM PRASAD5 pages
AI SummaryPartly Allowed

What did the High Court hold?

The High Court allowed the petition in part and quashed the impugned orders dated 30.09.2023. The Court reasoned that on the limited ground of denial of reasonable opportunity, interference was necessary. The revenue was unable to demonstrate that the petitioner's detailed response filed on 28.09.2023 had been considered. Consequently, the proceedings were restored for reconsideration. The Court directed that the petitioner be extended an opportunity of a personal hearing. Upon receiving information about the date of the personal hearing, the petitioner would be at liberty to file an additional response. The respondents were also directed to complete the proceedings within two months from the date of the personal hearing extended to the petitioner. The Court did not decide on the merits of the assessment itself, focusing solely on the procedural defect.

What were the facts?

The petitioner, EYGBS (INDIA) LLP, filed a writ petition challenging two orders dated 30.09.2023, passed by the Additional/Joint/Deputy/Assistant Commissioner of Income Tax under Section 143(3) read with Section 144C of the Income Tax Act for the assessment year 2020-21. The petitioner contended that the issuance of two identical orders was likely due to a technical glitch. The primary grievance was the lack of a reasonable opportunity to be heard. The petitioner received a notice on 27.09.2023, requiring an explanation by 2 pm on 28.09.2023. Despite the short notice, the petitioner filed a response on 28.09.2023, requesting a personal hearing. However, the petitioner alleged that neither the response was considered nor a personal hearing was granted, leading to the impugned order being passed based on a vague reply.

What were the issues?

1. Whether the impugned orders dated 30.09.2023, passed under Section 143(3) read with Section 144C of the Income Tax Act, are liable to be quashed on the ground of denial of a reasonable opportunity to the assessee for the assessment year 2020-21? Assessee's Contentions: - The petitioner argued that they were not afforded a reasonable opportunity to present their case. A notice was issued on 27.09.2023, with a deadline of 28.09.2023 for a response. Despite filing a response and requesting a personal hearing on 28.09.2023, their reply was not considered, and no personal hearing was granted. The impugned order was passed on the basis of a vague reply without proper consideration. Revenue's Contentions: - The revenue, represented by the learned standing counsel, was unable to demonstrate that the petitioner's response dated 28.09.2023, which detailed certain facts, had been considered by the assessing officer.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C

AI-generated summary — verify with the full judgment below

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NC: 2023:KHC:38804 WP No. 23812 of 2023

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2ND DAY OF NOVEMBER, 2023 BEFORE THE HON'BLE MR JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 23812 OF 2023 (T-IT)

BETWEEN:

EYGBS (INDIA) LLP 3RD FLOOR, TOWER C, RMX INFINITY OLD MADRAS ROAD, BANGALORE - 560 016 A LIMITED LIABILITY PARTNERSHIP FIRM UNDER THE PROVISIONS OF LLP ACT, 2008 REPRESENTED HEREIN BY ITS AUTHORIZED SIGNATORY PRASANNA THIRVALLUR ASURI. …PETITIONER (BY SMT. TANMAYEE RAJKUMAR, ADVOCATE) AND:

1.

ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME -TAX OFFICER NATIONAL E-ASSESSMENT CENTRE ROOM NO. 401, 2ND FLOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI – 110003.

Digitally signed by NARASIMHA MURTHY VANAMALA Location: HIGH COURT OF KARNATAKA

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NC: 2023:KHC:38804 WP No. 23812 of 2023

2.

ASSISTANT COMMISSIONER OF INCOME –TAX, CIRCLE 4(1) (1) BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU - 560 095.

3.

PRINCIPAL COMMISSIONER OF INCOME TAX -2 BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU - 560 095.

…RESPONDENTS (BY SRI.E.I. SANMATHI., ADVOCATE)

THIS W.P. IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER DATED 30.09.2023 (ANNX-N) BEARING DIN ITBA/AST/F/144C/2023-24/1056688187(1) PASSED BY THE R-1 UNDER SECTION 143(3) READ WITH SECTION 144C OF THE ACT, FOR THE ASSESSMENT YEAR 2020- 21; QUASH THE ORDER DATED 30.09.2023 (ANNX-P) BEARING DIN ITBA/AST/F/144C/2023- 24/1056688197(1) PASSED BY THE R-1 UNDER SECTION 143(3) READ WITH SECTION 144C OF THE ACT, FOR THE ASSESSMENT YEAR 2020-21.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:

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NC: 2023:KHC:38804 WP No. 23812 of 2023

ORDER

The petitioner has impugned the orders dated 30.09.2023 [Annexures-N and P] under Section 143(3) read with Section 144C of the Income Tax Act issued by the first respondent for the assessment year 2020-21. Smt. Tanmayee Rajkumar, the learned counsel for the petitioner, submits that both the orders relate to the petitioner and to the same assessment year, but two orders are generated by the respondents because of a possible technical glitch, and this assertion is not contested.

Smt. Tanmayee Rajkumar, insofar as the merits of the impugned order/s, submits that the petitioner’s grievance is essentially on the ground of the lack of reasonable opportunity and in this regard, the learned counsel submits that the petitioner was issued with notice on 27.09.2023 calling for an explanation before 2 pm on 28.09.2023. She submits that the petitioner, notwithstanding the limited time,

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NC: 2023:KHC:38804 WP No. 23812 of 2023

has filed response as per Annexure-L on 28.09.2023 while requesting for personal hearing, but neither the reply is considered nor the petitioner is extended an opportunity of personal hearing, and the impugned order is issued primarily on the ground that a vague reply is filed without any corroboration.

Sri E I Sanmathi, the learned standing counsel for the respondents, is heard in the light of the afore, and he is unable to demonstrate that the petitioner in the response dated 28.09.2023 [Annexure-L] has detailed certain facts and these details have not been considered. As such, on the limited ground of reasonable opportunity, there must be interference. Hence the following: ORDER [a] The petition is allowed in part, and the impugned orders dated 29.09.2023 [Annexures-N and P] are quashed restoring the proceedings for

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NC: 2023:KHC:38804 WP No. 23812 of 2023

reconsideration after extending an opportunity of personal hearing. It would be needless to observe that upon receipt of information of the date of personal hearing, the petitioner shall also be at liberty to file additional response. [b] The respondents are called upon to complete the proceedings within an outer limit of two [2] months from the date of personal hearing that is extended to the petitioner.

SD/- JUDGE

AN/-

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