M/S SURABHI CHITS LTD vs. COMMISSIONER OF INCOME TAX (APPEALS) -11

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WP/14311/2024HC KarnatakaKAHC01026328202426 November 2024Author: M.I.ARUN3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Karnataka, considering the facts and circumstances, was of the opinion that the interest of justice would be met by granting the petitioner an opportunity to present its case before the CIT(A). Consequently, the Court set aside the impugned order dated 27.01.2024 passed by the CIT(A) and the consequential notice issued under Section 226(3) of the Income Tax Act. The petitioner was directed to appear before the CIT(A) on 10.12.2024 without further notice, cooperate for a quick disposal of the case without seeking adjournments, and the CIT(A) was directed to pass appropriate orders after hearing the petitioner. The Court did not decide the merits of the original appeals.

What were the facts?

The petitioner, M/s. Surabhi Chits Ltd., filed a writ petition before the High Court of Karnataka challenging an order dated 27.01.2024 passed by the Commissioner of Income Tax (Appeals) - 11, Bangalore, and a consequential notice issued under Section 226(3) of the Income Tax Act by the Assistant Commissioner of Income Tax. The petitioner contended that they were not afforded sufficient opportunity to present their case before the CIT(A). The revenue, represented by the learned counsel, submitted that despite notices being issued, the petitioner did not appear or participate in the proceedings before the CIT(A). The writ petition concerns multiple appeal numbers spanning assessment years from 2012-13 to 2018-19.

What were the issues?

1. Whether the petitioner was denied a sufficient opportunity to present its case before the Commissioner of Income Tax (Appeals) under the Income Tax Act, 1961, leading to a violation of natural justice? Assessee's contention: The petitioner argued that they were not given adequate opportunity to present their case before the CIT(A) and that if such an opportunity were granted, they could demonstrate that the proceedings initiated against them were not sustainable. Revenue's contention: The revenue contended that notices were issued to the petitioner, but the petitioner failed to appear and participate in the proceedings before the CIT(A).

Which sections of the Income-tax Act were involved?

Section 226(3)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26TH DAY OF NOVEMBER, 2024 BEFORE THE HON'BLE MR JUSTICE M.I.ARUN WRIT PETITION NO. 14311 OF 2024 (T-IT)

BETWEEN:

M/S. SURABHI CHITS LTD., HAVING CORPORATE OFFICE AT NO.5, 2ND FLOOR, GAJENDRA TOWERS, 11TH MAIN, 4TH BLOCK, JAYANAGAR, BENGALURU - 560 011. A COMPANY INCORPORATED UNDER COMPANIES ACT,1956 REPRESENTED BY ITS MANAGING DIRECTOR, MR. DILIP B.M. …PETITIONER (BY KUM/SMT. SINDHU V. ADVOCATE FOR SRI. SIVARAMA KRISHNANAN AND SRI. M. SIVA SANKARAN.,ADVOCATES)

AND:

1.

COMMISSIONER OF INCOME TAX (APPEALS) - 11 BANGALORE. ROOM NO.322, 3RD FLOOR, CENTRAL REVENUE BUILDING, QUEENS ROAD, BANGALORE - 560 001.

2.

ASSISTANT COMMISSIONER OF INCOME TAX, INCOME TAX DEPARTMENT, OFFICE OF THE ASSISTANT, COMMISSIONER CENTRAL CIRCLE 1(4) BENGALURU-560 001. …RESPONDENTS (BY SRI. M. DILIP, ADVOCATE)

Digitally signed by CHAITHANYA K Location: High Court of Karnataka

THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO SET ASIDE THE ORDER OF R-1 DATED 27.01.2024 IN APPEAL NO. CIT(A)-11/BNG- 10217/2012-13, CIT(A)-11/BNG-10387/2013-14, CIT(A)-11/BNG- 11040/2014-15, CIT(A)-11/BNG-11108/2015-16, CIT(A)-11/BNG- 10834/2016-17, CIT(A)-11/BNG-10807/2017-18 AND CIT(A)- 11/BNG-12687/2018-19 PRODUCED AT ANNEXURE-A AND ETC.

THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE M.I.ARUN

ORAL ORDER

The petitioner in the instant writ petition is challenging the impugned order passed by respondent No.1 dated 27.01.2024 vide Annexure-A to the writ petition and the consequential notice issued under Section 226(3) of the Income Tax Act by respondent No.2. 2. In the course of the arguments the short question raised by the petitioner is that they have not given sufficient opportunity to present their case before respondent No.1 and if sufficient opportunity is given they would prove that the proceedings initiated against them is not sustainable.

3.

The learned counsel appearing for respondents submits that though notices were issued to the petitioner they have not appeared and participated in the proceedings.

4.

Under the given peculiar facts and circumstances of the case, this Court is of the opinion that interest of justice would be met if opportunity is given to the petitioner to present its case before respondent No.1. Hence, the following Order: (i) Impugned order dated 27.01.2024 in Appeal Nos. CIT(A)-11/BNG-10217/2012-13, CIT(A)-11/BNG- 10387/ 2013-14, CIT(A)-11/BNG-11040/2014-15, CIT(A)-11/BNG- 11108/2015-16, CIT(A)-11/BNG- 10834/2016-17, CIT(A)- 11/BNG-10807/2017-18 and CIT(A)-11/BNG-12687/2018- 19 at Annexure-A passed by respondent No.1 are hereby set aside. (ii) Notice issued under Section 226(3) of the Income Tax Act vide Annexure-B to the writ petition is hereby set aside. (iii) Petitioner is directed to appear before respondent No.1 on 10.12.2024 without further notice and it shall co-operate with respondent No.1 for quick disposal of the case without seeking any adjournments and respondent No.1 after hearing the petitioner shall pass appropriate orders.

Sd/- (M.I.ARUN) JUDGE

DS List No.: 1 Sl No.: 1

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