M/S MANIPAL EDUCATION AND MEDICAL GROUP INDIA PVT LTD., vs. THE ASSISTANT COMMISSIONER OF INCOME TAX

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WP/8814/2023HC KarnatakaKAHC01020125202331 May 2023Author: S SUNIL DUTT YADAV8 pages
AI SummaryRemanded

What did the High Court hold?

The High Court, in light of the submissions made by both parties, passed the following order. The impugned order dated 31.03.2022 passed under Section 148A(d) of the Act and the impugned notice dated 31.03.2022 issued under Section 148 of the Act were set aside. Consequently, all actions initiated pursuant to these, including those under Section 142(2A) and Section 144BA(1) and (2) of the Act, were also quashed. This included the impugned notices dated 21.03.2023 and 30.03.2023, and the notice dated 24.03.2023 and another notice dated 26.04.2023. The matter was remanded back to the Assessing Officer to hear the matter afresh from the Section 148A(b) stage. The petitioner was granted 30 days to file its reply to the notice dated 22.03.2022 under Section 148A(b). The Assessing Officer was directed to consider the reply and pass a fresh order under Section 148A(d) expeditiously. All contentions of both parties were kept open. The writ petition was disposed of accordingly.

What were the facts?

The petitioner, M/s Manipal Education and Medical Group India Pvt Ltd., filed a writ petition before the High Court of Karnataka challenging several orders and notices issued by the Income Tax Department. These included a notice under Section 148A(b) dated 22.03.2022, an order under Section 148A(d) dated 31.03.2022, a notice under Section 148 dated 31.03.2022, a notice under Section 144BA(1) dated 24.03.2023, a notice under Section 142(2A) dated 21.03.2023, and an order for special audit under Section 142(2A) dated 30.03.2023. The petitioner sought to quash these actions. During the hearing, the Revenue stated it had no objection to the matter being remanded to the stage prior to the issuance of a reassessment notice under Section 148, citing a violation of principles of natural justice.

What were the issues?

1. Whether the impugned orders and notices, including those under Section 148A(b), 148A(d), 148, 144BA(1), 142(2A), are liable to be quashed as far as the petitioner is concerned? (Question of law and fact, concerning various provisions of the Income Tax Act, 1961). Assessee's Contentions: The petitioner sought to quash all the impugned orders and notices. The specific grounds for quashing were not detailed in the provided text, but the relief sought indicates a challenge to the validity and legality of these actions. Revenue's Contentions: The learned Additional Solicitor General (ASG) appearing for the Revenue submitted that the respondents would have no objection to the matter being remanded to the stage prior to the issuance of a reassessment notice under Section 148 of the Act for fresh adjudication from the Section 148A(b) stage, in light of a violation of the principles of natural justice. No specific authorities or precedents were mentioned in the provided text.

Which sections of the Income-tax Act were involved?

Section 142(2A),Section 148A(b),Section 148A(d),Section 148,Section 144BA(1),Section 144BA(2)

AI-generated summary — verify with the full judgment below

Before: SMT. MEGHA MEHTA, ADVOCATE)

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 31ST DAY OF MAY, 2023 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 8814 OF 2023 (T-IT) BETWEEN: 1. M/S MANIPAL EDUCATION AND MEDICAL GROUP INDIA PVT LTD., 24/1, 15 FLOOR, J W MARRIOTT BANGALORE NORTH, BENGALURU-560 001. (REPRESENTED BY ITS DIRECTOR SRI. NISITH KUMAR MOHANTY AGED ABOUT 60 YEARS, S/O SRI. MOHANTY) INCORPORATED UNDER COMPANIES ACT-1956 … PETITIONER (BY DR. ABHISHEK MANU SINGHAVI A/W SRI AJAY VOHRA, SENIOR ADVOCATE, SRI S.K. TULRISJAN, ADVOCATE, SRI S. SHARATH, ADVOCATE AND SMT. MEGHA MEHTA, ADVOCATE) AND: 1. THE ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 4(1)(2) ROOM NO.230, 2ND FLOOR BMTC DEPOT BUILDING, 80FT. ROAD 6TH BLOCK, KORMANGALA Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA

2.

THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 4(1)(1) BMTC BUILDING, 80FT. ROAD, 6TH BLOCK NEAR KHB GAMES VILLAGE, KORMANGALA 3. THE ADDITIONAL /JOINT/DEPUTY/ ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER NATIONAL FECELESS ASSESSMENT CENTRE (REPRESENTED BY THE PRINCIPAL COMMISSIONER OF INCOME TAX, BENGALURU-2) BMTC BUILDING, 80FT ROAD, 6TH BLOCK, KORAMANGALA 4. THE PRINCIPAL COMMISSIONER OF INCOME TAX BENGALURU-2 BMTC BUILDING, 80FT ROAD, 6TH BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA … RESPONDENTS (BY SRI. M. VENKATARAMAN, ASG A/W SRI K.V. ARAVIND, ADVOCATE AND SRI M. DILIP, ADVOCATE)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH AS FAR AS THE PETITIONER IS CONCERNED BY AN APPROPRIATE WRIT OR ORDER IN THE NATURE OF CERTIORARI OR OTHERWISE, THE IMPUGNED PASSED BY THE R-4 FOR CONDUCT OF SPECIAL AUDIT UNDER SEC 142(2A) OF THE INCOME-TAX ACT, 1961 DTD 30/03/2023 VIZ NO. ITBA/COM/F/17/2022-23/1051646652(1) ENCLOSED AS ANNEXURE-U AND ETC.

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

Petitioner has filed the present writ petition seeking for the following reliefs: "(a) Quash as far as the petitioner is the nature of certiorari or otherwise the impugned order passed by the respondent No.4 for conduct of special audit under Section 142(2A) of the Income Act, 1961 30.03.2023 viz., No.ITBA/COM/F/17/2022-23/1051646651(1) ENCLOSED AT Annexure -U; (b) Quash as far as the Petitioner is impugned notice under section 142(2A), 21.03.2023, viz ITBA/ COM/F/17/2022-23/1051072444(1) passed by the Respondent No. 4, enclosed as Annexure Q;

(C) Quash as far as the Petitioner is impugned notice issued under section 148A(b) of the Income-tax Act, 1961 by the Respondent No. 2, dated 22.03.2022, viz No. ITBA/AST/F/148A(SCN)/2021-22/ 1041210068(1) for proposing reassessment in the case of Petitioner enclosed as Annexure D; (D) Quash as far as the Petitioner is impugned order passed by the Respondent No. 2 under section 148A(d) of the Income- tax Act, 1961, dated 31.03.2022, viz No. ITBA/AST/F/148A/2021-22/1042382145(1) proposing reassessment and issuance of notice under Section 148 of the Act in the case of Petitioner enclosed as Annexure K; (E) Quash as far as the Petitioner is impugned notice issued under section 148 of the Income-tax Act, 1961 by the Respondent

2, 31.03.2022, VIZ ITBA/AST/S/148_1/2021-22/1042385475(1) for reassessment in the case of Petitioner enclosed as Annexure K1; (F) Quash as far as the petitioner is impugned notice issued under Section 144BA(1) of the Income Tax, 1961 by the respondent No.2 dated 24.03.2023 viz., No. ITBA/AST/F/17/2022-23/1051272093(1) for invocation of Chapter X-A of the Income Tax Act, 1961, in the case of petitioner enclosed as Annexure-W."

2.

During the hearing on 25.05.2023, the learned ASG appearing for the Revenue submitted that the respondents would have no objection to have the matter remanded to the stage prior to issuance of a reassessment notice under Section 148 of the Income Tax Act, 1961 (the 'Act') for fresh adjudication from Section 148A(b) stage, in light of violation of principles of natural justice.

3.

Petitioner consents to the above proposal.

4.

In light of the above, the following order is passed: ORDER

a. The impugned order dated 31.03.2022 passed under Section 148A(d) of the Act and the impugned notice dated 31.03.2022 issued under Section 148 of the Act is hereby set aside.

b. All actions initiated pursuant to the above under Section 142(2A), Section 144BA(1) and Section 144BA(2) of the Act, being consequential, impugned notice dated 21.03.2023 and order dated 30.03.2023; notice dated 24.03.2023 and notice dated 26.04.2023 bearing Nos. ITBA/COM/F/17/2023-24/1052370469(1) and ITBA/COM/F/17/2023-24/1052350581(1) are consequentially quashed.

c. The matter is hereby remanded back to the Assessing Officer to hear the matter afresh from the Section 148A(b) stage initiated via impugned notice dated 22.03.2022.

d. The petitioner / Assessee is granted 30 days from the date of this order to file its reply along with documents as regards the notice dated 22.03.2022 under Section 148A(b).

e. After considering the petitioner's reply to impugned notice dated 22.03.2022 issued under Section 148A(b) of the Act, the department shall consider afresh keeping open the contentions of both parties and decide petitioner's reply to impugned notice dated 22.03.2022 issued under Section 148A(b) of the Act.

f. Thereafter, a fresh order under Section 148A(d) of the Act may be passed by the Assessing Officer

expeditiously after considering the petitioner's reply in accordance with law.

g. All rights of the petitioner/assessee under law shall remain available to it in respect of the aforesaid order.

All contentions of both the parties are kept open.

Writ petition is disposed off accordingly. All pending I.As. are disposed off as not calling for any adjudication in light of the disposal of the matter. Sd/- JUDGE VP

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