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Before: AND
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF SEPTEMBER, 2019 BEFORE THE HON’BLE MR.JUSTICE P.B. BAJANTHRI WRIT PETITION NO.19000 OF 2014 (T-IT) C/W WRIT PETITION NO.18993 OF 2014 WRIT PETITION NO.18995 OF 2014 WRIT PETITION NO.18996 OF 2014 WRIT PETITION NO.18997 OF 2014 AND WRIT PETITION NO.18998 OF 2014
IN WRIT PETITION NO.19000 OF 2014
BETWEEN:
M/S.MPHASIS DEUTSCHELAND GMBH HAVING ITS OFFICE AT KOBLENZER STRABE 34 56130, BAD EMS, GERMANY, REPRESENTED BY SRI ARIJIT GANGULYM AVP A/A 43 YEARS, S/O. LATE AMITAVA GANGULY R/AT NCC URBAN, NCC ASTER PARK BLOCK B, FLAT NO. 1001 YELAHANKA NEW TOWN BANGALORE-560 065
… PETITIONER
(BY SRI.DINESH P., ADV.- ABSENT)
AND:
ASST. DIRECTOR OF INCOME TAX INTERNATIONAL TAXATION, CIRCLE (1) RASHTROTHANA BHAVAN, NO.14/3, 6TH FLOOR NRUPATHUNGA ROAD BANGALORE-560 001
... RESPONDENT
(BY SRI.DILIP M. FOR SRI.K.V.ARAVIND, ADV.)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE IN ANNEX-A DTD: 29.03.2014 ISSUED UNDER SECTION 148 OF THE ACT IN TO AND ETC.
IN WRIT PETITION NO.18993 OF 2014
BETWEEN:
M/S.MPHASIS (SHANGHAI) SOFTWARE AND SERVICES COMPANY LIMITED HAVING ITS OFFICE AT ROOM NO.23206, NO.498, GHOUSHOUJING ROAD, PUDONG NEW AREA SHANGHAI P.O. 201203 CHINA, REP. BY SRI ARIJIT GANGULY, AVP A/A 43 YEARS, S/O LATE AMITAVA GANGULY R/AT NCC URBAN, NCC ASTER PARK BLOCK B, FLAT NO. 1001 YELAHANKA NEW TOWN BANGALORE-560 065
… PETITIONER
(BY SRI.DINESH P., ADV.)
AND:
ASST. DIRECTOR OF INCOME TAX INTERNATIONAL TAXATION, CIRCLE (1) RASHTROTHANA BHAVAN, NO.14/3, 6TH FLOOR NRUPATHUNGA ROAD BANGALORE-560 001
... RESPONDENT
(BY SRI.K.V.ARAVIND, ADV.)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE IN ANNEX-A DTD: 29.03.2014 ISSUED UNDER SECTION 148 OF THE ACT, DECLARE THAT THE PETITIONER HAS NO INCOME CHARGEABLE TO TAX IN INDIA AND ETC.
IN WRIT PETITION NO.18995 OF 2014
BETWEEN:
M/S.MPHASIS CORPORATION HAVING ITS OFFICE AT NO.460, PARK AVENUE SOUTH SUITE 1101, NEW YORK, NY 100 6 USA, REP. BY SRI ARIJIT GANGULY, AVP A/A 43 YEARS, S/O.LATE AMITAVA GANGULY R/AT NCC URBAN, NCC ASTER PARK BLOCK B, FLAT NO. 1001 YELAHANKA NEW TOWN BANGALORE-560 065
… PETITIONER
(BY SRI.DINESH P., ADV.)
AND:
ASST. DIRECTOR OF INCOME TAX INTERNATIONAL TAXATION, CIRCLE (1) RASHTROTHANA BHAVAN, NO.14/3, 6TH FLOOR NRUPATHUNGA ROAD BANGALORE-560 001
... RESPONDENT
(BY SRI.DILIP M. FOR SRI.K.V.ARAVIND, ADV.)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE IN ANNEX-A DTD: 29.03.2014 ISSUED UNDER SECTION 148 OF THE ACT IN TO, DECLARE THAT THE PETITIONER HAS NO INCOME CHARGEABLE TO TAX IN INDIA AND ETC.
IN WRIT PETITION NO.18996 OF 2014
BETWEEN:
M/S.MPHASIS UK LIMITED HAVING ITS OFFICE AT 7TH ST JOHN’S ROAD HARROW MIDDLESEX HA 1 2 EY UNITED KINGDOM REP. BY SRI ARIJIT GANGULY, AVP A/A 43 YEARS, S/O.LATE AMITAVA GANGULY R/AT NCC URBAN, NCC ASTER PARK BLOCK B, FLAT NO. 1001
YELAHANKA NEW TOWN BANGALORE-560 065
… PETITIONER
(BY SRI.DINESH P., ADV.)
AND:
ASST. DIRECTOR OF INCOME TAX INTERNATIONAL TAXATION, CIRCLE (1) RASHTROTHANA BHAVAN, NO.14/3, 6TH FLOOR NRUPATHUNGA ROAD BANGALORE-560 001
... RESPONDENT
(BY SRI.DILIP M. FOR SRI.K.V.ARAVIND, ADV.)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE IN ANNEX-A DTD: 29.03.2014 ISSUED UNDER SECTION 148 OF THE ACT IN TO, DECLARE THAT THE PETITIONER HAS NO INCOME CHARGEABLE TO TAX IN INDIA AND ETC.
IN WRIT PETITION NO.18997 OF 2014
BETWEEN:
M/S.MPHASIS CONSULTING LIMITED (FORMERLY PRINCETON CONSULTING LTD.) HAVING ITS OFFICE AT 88 WOOD STREET LONDON EC2V 7RS UNITED KINGDOM REP. BY SRI ARIJIT GANGULY, AVP A/A 43 YEARS, S/O.LATE AMITAVA GANGULY R/AT NCC URBAN, NCC ASTER PARK BLOCK B, FLAT NO. 1001 YELAHANKA NEW TOWN BANGALORE-560 065
… PETITIONER
(BY SRI.DINESH P., ADV.)
AND:
ASST. DIRECTOR OF INCOME TAX INTERNATIONAL TAXATION, CIRCLE (1) RASHTROTHANA BHAVAN,
NO.14/3, 6TH FLOOR NRUPATHUNGA ROAD BANGALORE-560 001
... RESPONDENT
(BY SRI.DILIP M. FOR SRI.K.V.ARAVIND, ADV.)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE IN ANNEX-A DTD: 29.03.2014 ISSUED UNDER SECTION 148 OF THE ACT, DECLARE THAT THE PETITIONER HAS NO INCOME CHARGEABLE TO TAX IN INDIA AND ETC.
IN WRIT PETITION NO.18998 OF 2014
BETWEEN:
M/S.MPHASIS AUSTRALIA PTY LIMITED HAVING ITS OFFICE AT SHOP 5 17-19N EAST PARADE, SUTHERLAND, NSW 2332 SYDNEY AUSTRALIA REP. BY SRI ARIJIT GANGULY, AVP A/A 43 YEARS, S/O.LATE AMITAVA GANGULY R/AT NCC URBAN, NCC ASTER PARK BLOCK B, FLAT NO. 1001 YELAHANKA NEW TOWN BANGALORE-560 065
… PETITIONER
(BY SRI.DINESH P., ADV.)
AND:
ASST. DIRECTOR OF INCOME TAX INTERNATIONAL TAXATION, CIRCLE (1) RASHTROTHANA BHAVAN, NO.14/3, 6TH FLOOR NRUPATHUNGA ROAD BANGALORE-560 001
... RESPONDENT
(BY SRI.DILIP M. FOR SRI.K.V.ARAVIND, ADV.)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE IN ANNEX-A DTD: 29.03.2014 ISSUED UNDER SECTION
148 OF THE ACT, DECLARE THAT THE PETITIONER HAS NO INCOME CHARGEABLE TO TAX IN INDIA AND ETC.
THESE PETITIONS COMING ON FOR HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER
In these bunch/batch of writ petitions, petitioner has assailed the notice dated 29.03.2014 (Annexure-A) (in all the matters) issued under Section 148 of the Income Tax Act, 1961 (for short ‘the Act’). 2. One of the ground urged by the petitioner is that there is no jurisdiction to initiate proceedings under Section 148 of the Act. The deductor is a tax assessee in India duly filing returns and getting assessed. The entire transaction of the petitioner has been duly captured and wholly disclosed. There is no hope for initiating proceedings under Section 148 of the Act. Petitioner has not apprised this Court in pointing out that the Assistant Director of Income Tax, International Taxation, Circle(1), Bengaluru – 560001 has no jurisdiction to initiate proceedings under Section 148 of the Act while issuing notice. Merely stating that
proceedings initiated were without jurisdiction cannot be appreciated. On the other hand, Supreme Court in the case of GKN Driveshafts (India) Ltd., Vs. Income Tax Officer & Ors reported in (2003) 179 CTR (SC) 11 held as under: We see no justifiable reason to interfere with the order under challenge. However, we clarify that when a notice under s. 148 of the IT Act is issued, the proper course of action for the noticee is to file return and if he so desires, to seek reasons for issuing notices. The AO is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the AO is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the AO has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the abovesaid five assessment years. 3. Having regard to the principle laid down by the Apex Court in the aforesaid decision, petitioner has
a remedy before the Assessing Officer to furnish its/his objection to the notice. On receipt of such objection, Assessing Officer is bound to pass a speaking order. When the petitioner has remedy as is evident from the notice, the petitions are premature. Accordingly, writ petitions stand dismissed as not maintainable. 4. The petitioner is permitted to submit its/his explanation before the competent authority within a period of six weeks from the date of receipt of this order. The competent authority is hereby directed to examine the show cause notice read with the explanation of the petitioner before passing a speaking order. If the statutory provision provides for oral hearing, the same shall be extended to the petitioner.
Sd/- JUDGE