Bombay High Court
Cg Power And Industrial Solutions Ltd vs Assistant Commissioner Of Income Tax ... on 17 October, 2023
Author: Neela Gokhale
Bench: K. R. Shriram, Neela Gokhale
1/5 901.WP-520-2020.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.520 OF 2020
CG Power and Industrial Solutions Ltd. ....Petitioner
V/s.
The Assistant Commissioner of Income
Tax, Circle 6(2)(1) and Ors. ....Respondents
WITH
WRIT PETITION (L) NO.4041 OF 2023
WITH
INTERIM APPLICATION (L) NO.11580 OF 2023
IN
WRIT PETITION (L) NO.4041 OF 2023
WITH
WRIT PETITION (L) NO.4299 OF 2022
----
Mr. J.D. Mistri, Senior Advocate a/w. Mr. Nitesh Joshi i/b. Mr. Atul K. Jasani
for petitioner.
Mr. Suresh Kumar for respondents in WPL/4041/2023 and WP/4299/2022
and for respondent nos.1 to 4 in WP/520/2020.
Mr. Niranjan Shimpi for respondent no.5 in WP/520/2020.
----
CORAM : K. R. SHRIRAM &
NEELA GOKHALE, JJ.
DATED : 17th OCTOBER 2023 P.C. :
1 Pursuant to the order passed by this Court on 11 th September 2023, petitioner has been given inspection of the file relating to this matter maintained by CBDT. It is not available, however, in the Court today though we had specifically directed the concerned file be produced on the next date. Petitioner has filed a compilation of documents, copies whereof were provided to petitioner by CBDT at petitioner's request after inspection. We find the compilation contains about 16 documents. In a letter dated Gauri Gaekwad 2/5 901.WP-520-2020.doc 8th February 2022 from ACIT-6(1)(1) to PCIT-6, Mumbai, it has been recommended that petitioner's case is genuine case for condoning the delay in filing revised return of income based on the restated books of accounts for Assessment Year 2017-2018. This has been accepted by the PCIT and by the PCCIT. The PCCIT, by a letter dated 24th February 2022/1st March 2022 addressed to CBDT, has forwarded the report received from the office of the PCIT as well as view of the PCIT that this was a fit case for condonation of delay. In response to this letter, the office of CBDT, by a letter dated 23rd June 2022, did not accept the recommendations and made the PCIT to have a re-look. In the said letter, it is stated "In this regard, I am directed to state the following :".
2 Mr. Mistri, on instructions states that no such directions were found in the file that was offered for inspection which makes us wonder on whose directions was this letter written. This letter was replied to by the office of the PCCIT vide letter dated 14 th July 2022 in which it was once again recommended that the delay be condoned. In that letter, it was specifically mentioned that in view of the various news report of action by central agencies related to assessee and its promoter/management and the underlying issues of bank fraud, money laundering etc. the Ministry of Corporate Affairs (MCA) had filed a petition before the National Company Law Tribunal (NCLT) to reopen and audit the books of accounts of the assessee company for five years from Financial Year 2014-2015 to Financial Gauri Gaekwad 3/5 901.WP-520-2020.doc Year 2018-2019 which was approved by NCLT. Auditors were appointed by the MCA to restate the audited books of accounts to look into these issues and the restated accounts were also taken on record by NCLT vide order dated 26th October 2021 after the necessary due diligence was completed under orders of the regulatory body. Therefore, it was suggested that since all the reported financial transgressions of the assessee has already been examined prima facie by the appropriate authorities and have been accounted for in the restated books of accounts, the Income Tax Authority authorities can now step into further examination of the assessees' claims, subject to acceptance of the application for condonation of delay in filing the return of income by the competent authority, which is CBDT in the present case. It has also been suggested that the likely tax implications at this stage would not be possible to ascertain as the re-casted books of accounts have not been made available to the department by the assessee or by the NCLT after passing of NCLT order dated 26 th October 2021. The tax implication of the re-casted books of accounts can only be found if the assessee files the return of income in pursuance of the re-casted books of accounts which in turn is dependent on the CBDT condoning the delay under Section 119(2)(b) of the Act. Strangely CBDT was not satisfied with the response and, therefore, by its letter dated 30 th November 2022, that is almost 4 ½ months later, the office of CBDT once again called upon the PCCIT to give his comments on the merits of petitioner's application. In Gauri Gaekwad 4/5 901.WP-520-2020.doc reply, the office of PCCIT, by its letter dated 2 nd December 2022, started singing a different tune and has turned around to state that the assessees' application is premature and the condonation of delay application may be rejected. In the compilation, there is another letter from the office of the PCCIT dated 23rd November 2022 of course for Assessment Year 2020-2021 recommending that the application of petitioner under Section 119(2)(b) of the Act should be allowed.
3 We agree with Mr. Mistri that the response of the office of PCCIT vide letter dated 2nd December 2022 mentioned earlier is rather strange because the entire incident of fraud etc. has happened for all the five years and common orders have been passed.
4 Mr. Suresh Kumar states that the learned ASG is briefed to appear in the matter and he is not available today and requests the matter be stood over to 31st October 2023.
5 We would grant indulgence as last chance and on the next date, if the learned ASG is unable to remain present, Mr. Suresh Kumar is directed to go on with the matter and no adjournment will be granted. 6 Mr. Suresh Kumar states that by the next date, respondents will be able to answer the points identified by Mr. Mistri from the compilation of documents tendered today.
7 We find from the letters addressed by the office of CBDT stating "I am hereby directed to address you as under". The CBDT, i.e., Gauri Gaekwad 5/5 901.WP-520-2020.doc respondent no.5, shall place on record the directions based on which letters were addressed by the office of CBDT to PCCIT and others in this matter.
The same shall be placed on record alongwith an affidavit to be filed by the Director (OT and WT). The affidavit shall be filed and copy served by 12 noon on 26th October 2023.
8 Stand over to 31st October 2023 as last chance.
(NEELA GOKHALE, J.) (K. R. SHRIRAM, J.)
Signed by: Gauri A. Gaekwad
Gauri Gaekwad
Designation: PS To Honourable Judge
Date: 17/10/2023 17:45:27