M/S. DEEPAK CABLES (INDIA) LTD vs. CENTRAL BOARD OF DIRECT TAXES

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 1ST DAY OF APRIL, 2015

BEFORE

THE HON'BLE MR.JUSTICE ARAVIND KUMAR

W.P.Nos.47157/2014 & 52256-52257/2014(T-IT)

BETWEEN:

M/S DEEPAK CABLES (INDIA) LTD. NO.7, N.S.IYENGAR STREET SESHADRIPURAM BANGALORE-560 020 REP. BY ITS MANAGING DIRECTOR SRI K.VENKATESWAR RAO

….. PETITIONER

(BY SMT.S.R.ANURADHA, ADVOCATE)

AND:

MINISTRY OF FINANCE

DEPARTMENT OF REVENUE

GOVERNMENT OF INDIA

NORTH BLOCK

NEW DELHI-110 001

REP. BY UNDER SECRETARY

MINISTRY OF FINANCE

DEPARTMENT OF REVENUE

NORTH BLOCK

NEW DELHI-110 001

C.R.BUILDING NO.1

QUEENS ROAD

BANGALORE-560 001

RANGE-2

NO.14/3A, 5TH FLOOR

RASHTROTHANA BHAVAN

NRUPATHUNGA ROAD

BANGALORE-560001

... RESPONDENTS

(BY SRI K.V.ARAVIND, ADVOCATE)

THESE WRIT PETITIONS ARE FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ORDER DATED 28.1.2014 PASSED BY THE R1 VIDE ANNX-A AND DIRECT THE R1 TO CONISDER THE APPLICATION DATED 31.8.2013 VIDE ANNX.D, D1 & D2 BY THE PETITIONER AND CONDONE THE DELAY IN FILING THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2006-07, 2007-08 AND 2008-09 BY EXTENDING EXEMPTION.

THESE PETITIONS COMING ON FOR PRELIMINARY HEARING ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING:

ORDER

The issue involved in the present writ petition relates to the order passed by the Central Board of Direct Taxes (in short ‘CBDT’), rejecting the application

3 filed by the petitioner-assessee under Section 119(2) of Income Tax Act, 1961 (‘Act’ for short).

4 condonation of delay and observing that Board would pass orders within outer limit of five(5) months from the date of filing of application. Observation made by this Court reads as under: “In that view of the matter, nothing further survives for consideration in these petitions except to direct the petitioners to file necessary applications enclosing all material information and records to the CBDT for a decision over condonation of the delay in filing the returns and if the CBDT has issued any circular/instructions delegating such powers to its officers, then the CBDT, it is needless to state, to forward the papers to the concerned delegate of the power to consider the applications and pass orders in accordance with law. If petitioners file the representation within one month from today, there is no reason to believe that the CBDT or its delegates would not pass orders within an outer limit of five months from the date of filing applications. All contentions of the parties are kept open.”

5 why said application filed by petitioner under Section 119(2)(b)(c) should not be rejected and by order dated 28.01.2014 (Annexure-A) has rejected the application. Perusal of the impugned order dated 28.1.2014 (Annexure-A) would indicate that after disposal of writ petition on 31.7.2013 (Annexure-C), a notice came to be issued to the petitioner on 16.12.2013 vide Annexure-F, calling upon the petitioner-assessee to show cause as to why the petition filed under Section 119(2) seeking for condonation of delay in filing the return of income should not be rejected by furnishing its reply, if any. Petitioner is said to have furnished the reply on 26.12.2013 as per Annexure-G and the same has been received by the Department of Revenue, namely, the addressee of Annexure-G as could be seen from the acknowledgment along with round seal affixed on Annexure-G.

6 4. Thus, it was incumbent upon CBDT to examine as to whether the petitioner-assessee has made out a case for condoning the delay in not filing the return of income within the period prescribed under Section 139 (1) of the Act by addressing itself to the grounds urged in the reply dated 26.12.2013 (Annexure-G). However, without even adverting to the said objection, Board has passed the impugned order by rejecting the application for condonation of delay on the ground that no reply had been furnished till the date of passing of the order and as such, CBDT has been presumed that assessee does not have anything to say in the matter. This finding recorded by the CBDT is contrary to the records namely, reply given to the show-cause notice dated 26.12.2013 vide Annexure-G, would clearly indicate that petitioner-assessee has submitted its reply to the show-cause notice dated 16.12.2013 and same has not been considered by the respondent.

7 On this ground, prayer sought for in the writ petition deserves to be granted or in other words, impugned order is liable to be quashed.

i) Writ petition is hereby allowed in part.

ii) Order dated 28.1.2014 (Annexure-A) passed by first respondent is hereby quashed.

iii) Proceedings relating to application filed by the petitioner-assessee under Section 119(2) is remanded back to first respondent for being adjudicated on merits and in accordance with law and it is needless to state that CBDT would examine objection filed by petitioner to show-cause notice dated

8 16.12.2013 (issued by Board) and whether application filed by petitioner under Section 119 of Income Tax Act, 1961 deserves to be allowed or dismissed. It is also made clear that first respondent shall take note of the objection which is available in the present writ petition said to have been filed by the petitioner on 26.12.2013(Annexure-G) while examining the claim of petitioner for condonation of delay.

v) However, it is made clear that finding recorded by this Court in W.P.No.14825/2014 disposed of by the order of even date would stand covered in respect of other issues.

v) Petitioner shall appear before the first respondent on 22.04.2015 at 3.00 P.M. without waiting for any further notice from 1st respondent.

Sd/- JUDGE

Yn.