IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF OCTOBER, 2019 BEFORE:
THE HON’BLE MRS. JUSTICE S.SUJATHA W.P.Nos.14833 & 15147 – 15148/2018 (T – IT) BETWEEN:
SHRI M.A.ZAHID S/O LATE M.ABDUL RAHIM, AGED ABOUT 54 YEARS, R/O ELEGANT DAVIS APARTMENT, FLAT NO.503, 11TH DAVIS ROAD, RICHARDS TOWN, BANGALORE-560084 ... PETITIONER [BY SRI MURTHY DAYANAND NAIK, ADV.] AND:
ASSISTANT COMMISSIONER OF INCOME TAX (OSD) THE TAX RECOVERY OFFICE (CENTRAL) 3RD FLOOR, CENTRAL REVENUE BUILDING, QUEENS ROAD, BANGALORE-560 001 …RESPONDENT [BY SRI E.I.SANMATHI, ADV. FOR SRI K.V.ARAVIND, ADV.] THESE WRIT PETITIONS ARE FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH ANNEXURE-A DATED 28.03.2018 FOR THE A.Y.2007- 2008, THE NOTICE TO SHOW CAUSE WHY A WARRANT OF ARREST SHOULD NOT BE ISSUED IN FORM NO.I.T.C.P-25 ISSUED BY THE RESPONDENT AND ETC.
THESE PETITIONS COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:-
O R D E R In these writ petitions, the challenge is made to the show-cause notices issued by the respondent under Rule 73 of the Schedule – II – Procedure for Recovery of Tax in Part – V – Arrest and Detention of the Defaulter under the Income Tax Act, 1961 relating to the Assessment years 2007-08, 2009-10, 2010-11 and defreeze the savings bank account of the petitioner standing in his name at HDFC Bank Limited, Nandidurga Main Road Branch, Jayamahal Extension, Bangalore.
2. The petitioner is an assessee under the provisions of the Income Tax Act, 1961 (‘Act’ for short) who has been carrying on the business in the name and style of S.M.S.K. Mineral Trading Company. It is the grievance of the petitioner that despite the relief given to the assessee by the Income Tax Appellate Tribunal, Panaji Bench by an order dated 22.12.2017 relating to the assessment years in question, the revenue has issued the show-cause notice calling upon the petitioner to appear before the authority for the alleged default committed in making the payment of tax.
3. Learned counsel for the petitioner would submit that in terms of Rule 75 of Schedule –II, custody pending hearing can be invoked by the Tax Recovery Officer. Hence, in the circumstances, interest of the petitioner has to be protected.
4. Learned counsel for the revenue would submit that the petitioner is before this Court only on the apprehension of committing him to the civil prison. It is trite that unless the reply submitted by the petitioner dated 31.03.2018 to the show-cause notice issued is considered, an order of detention is passed in terms of Rule 76 of Schedule – II after hearing the petitioner, the detention of the defaulter in the civil prison may not arise and further an appeal is provided under Rule 86 of Schedule –II to challenge the order of detention, if any, passed by the Tax Recovery Officer under the Schedule –II. The machinery is provided to challenge the order of detention, if any, passed by the Tax Recovery Officer. Reliance is also placed on the order of this Court passed in Crl.P.No.3668/2018, dated 26.06.2018 to contend that the anticipatory bail moved by the petitioner has been rejected observing that the show-cause notice impugned does not give rise to any apprehension of immediate arrest so as to invoke the jurisdiction of the Sessions Court or High Court under Section 438 of Cr.P.C.
5. I have carefully considered the rival submissions of the learned counsel for the parties. Perused the records.
6. It is not in dispute that pursuant to the show–cause notice impugned dated 28.03.2018 relating to the assessment years in question, the petitioner has submitted the detailed reply dated 31.03.2018. In terms of Rule 73 of Schedule – II, show-cause notices have been issued calling upon the petitioner to appear before the Tax Recovery Officer on the dates specified in the notices. The apprehension of the petitioner that he may be committed to the civil prison on the date of appearance can be allayed with, directing the Tax Recovery Officer to consider the reply submitted by the petitioner and to take a decision in accordance with law after providing reasonable opportunity of hearing to the petitioner.
7. Hence, the petitioner shall appear before the respondent on 14.10.2019 without waiting for any further notice and respondent shall consider the explanation of the petitioner in terms of the reply submitted and after providing reasonable opportunity of hearing shall take a decision in the matter in accordance with law in an expedite manner. All rights and contentions of the parties are left open.
No precipitative action shall be taken till the final order shall be passed by the respondent in accordance with law.
With the aforesaid observations and directions, the writ petitions stand disposed of.
Sd/- JUDGE PMR