Case Law Details
TDGSM Co-Operative Society Ltd Vs CIT (Kerala High Court)
Kerala High Court dismisses writ challenging income tax assessment by TDGSM Co-Op Society. Details on court’s decision, petitioner’s claims, and potential remedies explored.
Introduction: This article delves into the Kerala High Court’s decision to dismiss a writ petition challenging the income tax assessment order in the case of TDGSM Co-Operative Society Ltd Vs CIT. The petitioner’s claims, court’s rationale, and potential remedies are scrutinized to provide a comprehensive understanding of the proceedings.
Background of the Case:
i. Filing of Writ Petition: The writ petition is filed against Ext.P2 assessment order and demand related to the assessment year 2016-2017. The petitioner, TDGSM Co-Operative Society Ltd, opted for legal recourse to contest the assessment.
ii. Reasons for Assessment Reopening: The petitioner’s case was flagged due to substantial cash deposits during the financial years 2015-2016 and 2016-2017. The Income Tax Department initiated the reopening of assessment under Section 148 of the Income Tax Act, 1961.
iii. Petitioner’s Response and Exparte Assessment: The petitioner filed the return of income, declaring a ‘Nil’ total income after claiming deductions under Chapter VIA (80P). Subsequent notices under Section 142(1) were issued, but the petitioner failed to respond. The best judgment assessment order under Section 144 was passed exparte, given the lack of cooperation from the petitioner.
Court’s Decision and Rationale:
i. Contestation by Petitioner: The petitioner contended that they did not receive the notice. However, the court, considering the established system for communication of notices, orders, etc., rejected this claim.
ii. Dismissal of Writ Petition: Given the petitioner’s non-cooperation with the proceedings and the lack of grounds to entertain the writ petition against the assessment order, the court dismissed the writ petition.
Conclusion and Remedies: The dismissal leaves the petitioner with the option to pursue remedies such as appeal. If the petitioner chooses to appeal, the appellate authority is urged to expedite the proceedings and decide the appeal in accordance with the law. This article sheds light on the legal aspects, providing insights into the court’s decision and the available courses of action for the petitioner.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
1. The present writ petition has been filed impugning Ext.P2 assessment order and demand.
2. The petitioner assessee did not file the returns of the assessment year 2016-2017. As per the information received through Multi-layer NMS cases in AIMS module of ITBA, the petitioner case was selected noticing the huge cash deposit during the financial year 2015-2016 and 2016-2017. The assessment of the petitioner case was reopened by issuance of notice under Section 148 of the Income Tax 1961 ( the ‘IT Act’ for short). In response to the said notice, the petitioner had filed return of income for the assessment year 2016-2017 on 04.2021, declaring total income at ‘Nil’ after claiming deduction under Chapter VIA (80P) of Rs. 2,64,133/-. Subsequently, the petitioner was issued notices under Section 142(1) of the IT Act dated 08.07.2021 and 18.11.2021. However, the petitioner failed to respond with the notices. Finally one more opportunity by the notice under Section 142(1) of the Act was given to the petitioner on 24.02.2022. The petitioner did not avail of the opportunities of being heard, and the petitioner did not cooperate with the proceedings. Therefore, keeping in view of the time limit to complete the assessment, the best judgment assessment order was passed under Section 144 of the IT Act exparte, the petitioner did not submit the return in response to the notice under Section under Section 148 of the IT Act.
3. Learned counsel for the petitioner submits that the petitioner did not receive the notice. However, this contention cannot be accepted in view of the system which has been placed for communication of notices , orders etc., therefore I do not find any ground to entertain this writ petition against the impugned assessment order.
In the result, this writ petition is dismissed, leaving it open to the petitioner to avail remedy of appeal if any, or such other remedies are available. If the petitioner approached the appellate, the appellate authority should proceed to decide the appeal in accordance with law, expeditiously.
