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1 IN THE HIGH COURT OF KARNATAKA, BENGALURU
DATED THIS THE 9TH DAY OF DECEMBER, 2022
BEFORE
THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR
WRIT PETITION No.23989 OF 2022 (T-IT)
BETWEEN:
PADUBIDRI CO-OPERATIVE AGRICULTURAL SOCIETY (N) REP. BY ITS CHIEF EXECUTIVE OFFICER MRS. NISHMITHA P.H. D/O SRI HARISH PADUBIDRE RAJU AGED ABOUT 28 YEARS OFFICE AT NO.1, HEAD OFFICE PADUBIDRI, UDUPI 574111
...PETITIONER (BY SRI. S. ANNAMALAI, ADVOCATE)
AND:
1 . THE NATIONAL FACELESS ASSESSMENT CENTRE REP. BY ADDL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX / INCOME TAX OFFICER, INCOME TAX DEPARTMENT MINISTRY OF FINANCE ROOM NO.401, 2ND FLOOR E-RAMP, JAWAHARLAL NEHRU STADIUM DELHI 110 003.
2 . THE INCOME TAX OFFICER WARD 1 AND TPS, UDUPI AAYAKAR BHAVAN, UDUPI MALPE ROAD, AADIUDUPI AMBALAPADI (PO), UDUPI KARNATAKA 576 103.
…RESPONDENTS (BY SRI. E.I.SANMATHI., ADVOCATE )
THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ASSESSMENT ORDER PASSED BY THE R1 U/S 143(3) R/W SECTION 144B OF THE INCOME TAX ACT, 1961 DTD 20.09.2022 BEARING DIN NO.ITBA/AST/S/143(3)/2022-23/1045710752(1) FOR THE ASSESSMENT YEAR 2020-21 HEREIN MARKED AS ANNEXURE-A1 AND ETC.
THIS W.P. COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER
In this petition, petitioner has sought for the following reliefs: a. Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the assessment order passed by the respondent No.1 under Section 143(3) read with section 144B of the Income Tax Act, 1961 dated 20.09.2022 bearing DIN No.ITBA/ AST/S/143(3)/2022-23/1045710752(1) for the assessment year 2020-21 herein marked as Annexure – A1.
b. Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the computation sheet issued by the respondent No.1 dated 20.09.2022 bearing DIN and Document No: ITBA/AST/S/530/2022-23/ 1045710906(1) in respect of the assessment year 2020-21 herein marked as Annexure – A2.
c. Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice of demand issued under section 156 of the Act by the Respondent No.1 dated 20.09.2022 bearing DIN and Notice No: ITBA/AST/S/156/2022-23/1045710894(1) in respect of the assessment year 2020-21 herein marked as Annexure – A3.
d. Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the show cause notice for penalty issued under section 270A of the Act by the Respondent No.1 dated 20.09.2022 bearing DIN No.
3 ITBA/PNL/S/270A/2022-23/1045710975(1) in respect of assessment year 2020-21 herein marked as Annexure – A4.
e. And pass such other orders as this Hon’ble Court deems fit and proper in the interest of justice and equity.
Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record.
A perusal of the material on record discloses that in response to the Notice dated 03.11.2021 issued by respondent No.1 under Section 142(1) of the Income Tax Act, 1961 (for short, 'the IT Act'), the petitioner submitted a response dated 17.11.2021 along with documents claiming deduction under Section 80P of the IT Act placing reliance upon the judgment of the Apex Court in the case of Mavilayi Service Co-operative Bank Ltd. Vs. Commissioner of Income Tax, Calicut – (2021) 123 Taxmann.com 161(SC). Subsequently, the respondent No.1 issued a Show Cause Notice dated 10.09.2022 to which the petitioner submitted a reply on 15.09.2022 putting forth various contentions.
It is the grievance of the petitioner that despite the petitioner submitting a detailed response / reply to the Show Cause Notice and bringing to the notice of respondent No.1 that the petitioner would be entitled to the benefit of Section 80(P) of the IT Act, in the light of the judgment of Mavilayi’s case supra, the respondent has proceeded to pass the impugned assessment order without taking into consideration the reply submitted by the petitioner and the judgment of the Apex Court. It is interesting to note that though the judgment of the Apex Court in Mavilayi’s case supra was referred to supra by respondent No.1, he choose to not to place reliance upon the same on the erroneous ground that the said judgment arouse out of the provisions of the Kerala Co-operative Society’s Act and not Karnataka Co-operative Society’s Act, which is completely misconceived and untenable. On this ground alone, I am of the considered opinion that the impugned order deserves to be set aside and matter remitted back to the respondent No.1 for reconsideration afresh in accordance with law.
In the result, I pass the following: ORDER (i) Petition is hereby allowed. (ii) The impugned Assessment Order at Annexure – A1 dated 20.09.2022, Computation Sheet at Annexure – A2 dated 20.09.2022, Notice of Demand at Annexure – A3 dated 20.09.2022 and the Show Cause Notice at Annexure – A4 dated 20.09.2022 passed / issued by respondent No.1 are hereby set aside. (iii) Matter is remitted back to respondent No.1 for reconsideration afresh in accordance with law after considering the reply dated 15.09.2022 submitted by the petitioner and judgment of the Apex court in Mavilayi’s case supra. (iv) Liberty is reserved in favour of the petitioner to submit additional pleadings, documents, judgments, etc., before respondent No.1, who shall consider the same
6 and proceed further in accordance with law, after providing opportunity of personal hearing to the petitioner.
Sd/- JUDGE