GHANSHYAM GUPTA vs. CHIEF COMMISSIONER OF INCOME TAX

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WP/14575/2017HC KarnatakaKAHC01004253201722 November 2018Bench: ALOK ARADHE6 pages
AI SummaryRemanded

What did the High Court hold?

The High Court directed the Assessing Authority to decide the petitioner's pending application for refund of the seized amount with interest, by a speaking order within three months.

What were the facts?

During a search, Rs. 9 lakhs was found with a custodian on behalf of the petitioner. The petitioner claimed ownership and sought refund, but the amount was subject to protective assessment and penalty. The penalty was later cancelled by the Tribunal.

What were the issues?

Whether the petitioner is entitled to a refund of the seized amount with interest, and whether the Assessing Authority should pass a speaking order on the pending application.

Which sections of the Income-tax Act were involved?

Section 158BC,Section 158BCF2

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 22ND DAY OF NOVEMBER 2018

BEFORE

THE HON’BLE MR.JUSTICE ALOK ARADHE

WRIT PETITION NO.14575 OF 2017 (T-IT)

BETWEEN:

GHANSHYAM GUPTA, SINCE DECEASED REPRESENTED BY HIS LEGAL HEIR,

MR.SAI ABHISHEK GUPTA, 414, PARAS, MANYATHA APPT., 102, RACHENA HALLI MAIN ROAD, MANYATA TECH PARK BACK GATE NO.5, BANGALORE NORTH, DR.SHIVARAMAKARANTH NAGAR, BANGALORE – 560 777. …PETITIONER

(BY SRI. K. MALLAHA RAO & SRI. ARVINDA S.N., ADVOCATES)

AND:

1.

CHIEF COMMISSIONER OF INCOME TAX,

QUEENS ROAD,

BANGALORE – 560 001.

2.

ASSISTANT COMMISSIONER OF

INCOME TAX,

CIRCLE – I,

BANGALORE – 560 046. ...RESPONDENTS

(BY SRI. K.V.ARAVIND, ADV.,)

2 THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT RESPONDENT TO REFUND THE AMOUNT WITH INTEREST FROM THE DATE OF SEIZURE OF THE SAME TO THE LEGAL HEIR OF THE PETITIONER.

THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:

O R D E R

Mr. K. Mallaha Rao, learned Counsel for the petitioner.

Mr. K.V. Aravind, learned Counsel for the respondents.

The petition is admitted for hearing. With the consent of learned Counsel for the parties, the matter is heard finally.

2.

In this writ petition, petitioner, inter alia, seeks for a writ of mandamus, directing the respondents

3 to refund the amount with interest from the date of seizure of the same to the legal heir of the petitioner.

3.

In order to appreciate the petitioner’s grievance, few facts under mentioned which are stated infra.

4.

Late Ghanshyam Gupta was a regular assessee under the Income Tax Act, 1961 [hereinafter referred to as ‘Act’, for short]. On 19.12.1997, a search was conducted by the Income Tax Department at the premises of Mr. Rakesh Kapadia and Mr. Suresh Kapadia who were the Proprietors of Malva Silk Emporium, Bengaluru. During the search period, an amount of Rs.9 lakhs was found with one Mr. Niranjan who is said to be custodian of the amount on behalf of the petitioner. On 19.03.1998, the petitioner sent a letter to the concerned Authority and sought refund of the amount of Rs.9 lakhs by accepting ownership of the aforesaid amount. Rakesh Kapadia and Suresh

4 Kapadia were also assessed under Section 158BC of the Act, wherein an amount of Rs.9 lakhs for which ownership is claimed by the assessee is assessed by the Income Tax Authority in their names. The Respondent No.2 issued a notice under Section 158BC of the Act to the petitioner. The Assessing Authority made certain additions on the basis of protective assessment under Section 158BCF[2] of the Act and levied protective penalty of Rs.5,40,000/- vide Order dated 19.01.2014.

5.

Being aggrieved, the petitioner filed an appeal before the Commissioner of Income Tax [Appeals], Bangalore, for block period 1988-89 to 1998- 99. The Tribunal, by order dated 11.12.2012 directed the Assessing Authority to cancel the penalty order. Thereupon, the petitioner’s father submitted a representation to the Respondent No.2 requesting him to adjust tax arrears to the tune of Rs.5,40,000/- out of Rs.9,00,000/- and to refund the remaining amount of

5 Rs.3,60,000/- along with interest. However, the Respondent No.2 did not pass any order on the application of the father of the petitioner. In the aforesaid facts and circumstances, the petitioner has approached this Court.

6.

When the matter is taken up today, learned Counsel for the petitioner submitted that the writ petition be disposed of with the direction to the Respondent No.2 to pass appropriate order on the application which is pending consideration before him seeking refund of the amount, in accordance with law, by a speaking order. Learned Counsel for the revenue has fairly not opposed the prayer.

In view of the aforesaid submissions and in the facts of the case, writ petition is disposed of with the direction to the Respondent No.2 to decide the application pending before it seeking refund of the amount by a speaking order in accordance with law

6 within a period of three months from the date of receipt of certified copy of the order passed today.

Sd/- JUDGE AN/-

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