Karnataka High Court
Mr B S Uday Shetty vs The Assistant Commissioner Of Income ... on 21 April, 2022
Author: B. M. Shyam Prasad
Bench: B. M. Shyam Prasad
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 21ST DAY OF APRIL 2022
BEFORE
THE HON'BLE MR. JUSTICE B. M. SHYAM PRASAD
WRIT PETITION NO.8589/2022 (T - IT)
BETWEEN :
MR.B.S.UDAY SHETTY
SON OF SRI.B.G.SHRIKANTA SHETTY
AGED ABOUT 36 YEARS
# 1, SKS ARECANUT TRADING CO.,
STATION ROAD, BIRUR TALUK
CHIKMAGALUR DISTRICT - 577 116
PRESENTLY RESIDING AT # 79/A,
2ND CROSS, KOLEGOTE, INDUSTRIAL AREA
CHITRADURGA - 577 501. ... PETITIONER
(BY SRI.ANNAMALAI.S., ADVOCATE)
AND :
THE ASSISTANT COMMISSIONER OF INCOME-TAX
CENTRAL CIRCLE, HASSAN
AAYAKAR BHAVAN, 2ND STAGE, BELUR ROAD
HASSAN - 573 201
KARNATAKA ...RESPONDENT
(BY SRI.K.V.ARAVIND, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
& 227 OF THE CONSTITUTION OF INDIA PRAYING TO
QUASH THE PENALTY ORDER PASSED BY THE
RESPONDENT UNDER SECTION 271AAB OF THE INCOME
TAX ACT, 1961 DATED 29.03.2022 FOR THE ASSESSMENT
2
YEAR 2019-20 HEREIN MARKED AS ANNEXURE-A1 AND
ETC.
THIS WRIT PETITION COMING ON FOR PRELIMINARY
HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
The petitioner has impugned the penalty order dated 29.03.2022 under Section 271AAB of the Income Tax Act, 1961 [for short "I.T. Act"] and the consequential notice of demand dated 29.03.2022 under Section 156 of the I.T. Act. The petitioner's grievance with the impugned order and the notice of demand is that these are notwithstanding the petitioner's appeal as against the subject assessment order dated 22.04.2021.
The petition is taken up for final disposal with the consent of Sri Annamalai, learned counsel for the petitioner, and Sri K V Aravind, learned Standing counsel who accepts notice for the respondent, given the limited nature of the controversy. 3
After the Assessment Order dated 22.04.2021 under Section 143(3) of the I.T. Act for the assessment year 2019-20, the petitioner is issued with the impugned notice under Section 274 read with Section 271AAB of the I.T. Act. The petitioner has responded to this notice stating that he proposes to file an appeal against the Assessment Order dated 22.04.2022. The petitioner has not filed such appeal immediately because of the Covid-19 pandemic, but on 03.09.2021, has filed separate appeals as against the Assessment Order dated 22.04.2021 and the Assessment Order for the previous Assessment Year 2018-19.
The petitioner's case is that for the reasons that the petitioner cannot explain, a common acknowledgement has been generated for both the appeals relating to the Assessment Years 2018-19 and 2019-20. The respondent in passing the impugned Order has disbelieved the petitioner's explanation 4 stating the petitioner has not filed any appeal in the electronic form or otherwise.
This Court, while considering the petitioner's grievance as against the penalty order for the previous Assessment year 2018-19 in similar circumstances, has extended the benefit of another opportunity quashing the penalty order without disturbing the initiation of the proceedings under Section 274 read with 271AAB of the I.T. Act, observing that the Assessing Officer can ascertain whether the petitioner has filed a valid appeal and then to proceed further.
In the present case, another feature is that the petitioner has filed another appeal in Form-35 on 28.03.2022. The Assessing Officer has passed the impugned order for penalty in the premise that the Assessing Officer could not find any appeal in Form 35 either in the electronic form or in the hard form and 5 therefore, it must be opined that the petitioner has not filed a valid appeal. Whether the appeal is filed or not can be verified in the circumstances relied upon by the petitioner viz., that indeed he has filed an appeal on 03.09.2021 and there was a common acknowledgement generated for the appeal of the relevant assessment year and also the previous Assessment Year and that the subsequent appeal is filed on 28.03.2021.
Therefore, this Court is of the considered view that the impugned order dated 29.03.2022 and the notice of demand dated 29.03.2022 vide Annexures A1 and A2 must be quashed by saving the initiation of the proceedings under Section 274 read with Section 271AAB of the I.T. Act in terms of the notice dated 22.04.2021. The Assessing Officer shall be at liberty to ascertain as to whether a valid appeal is filed and then proceed in accordance with law. The Assessing Officer can also call for necessary details from the petitioner. 6
The writ petition is disposed of accordingly.
Sd/-
JUDGE mv