IN HIGH COURT OF KARNATAKA DHARWAD BENCH DATED THIS 14TH DAY OF JULY 2020 BEFORE HON BLE MR. JUSTICE SACHIN SHANKAR MAGADUM W.P.No.147034/2020 (T-IT) BETWEEN: SHRI.SALESHWAR PATTIN SAHAKARI SANGHA NIYAMIT HATTI BUILDING, MAINIROAD, GULEDGUDD-587203, REP. BY ITS CHIEF EXECUTIVE OFFICER, SHRI.RAMESH NAGAPPA JIDAGI S/O NAGAPPA JIDAGI, AGED ABOUT: 39 YEARS, DIST: BAGALKOTE. .. PETITIONER (BY SRI.H.R.KAMBIYAVAR & SMT.PATRI SHASHIKALA, ADVS.) AND: 1. INCOME-TAX OFFICER WARD 1, C R BUILDING, NAVANAGAR, BAGALKOTE-587202. 2. COMMISSIONER OF INCOME TAX (APPEALS), KIMJI BAI BUILDING, OPP-CIVIL HOSPITAL, BELAGAVI-590001. 3. PRINCIPAL COMMISSIONER OF INCOME TAX, (ADMINISTRATION), C.R. BUILDING, NAVANAGAR, HUBBALLI-580025. .. RESPONDENTS (BY SRI.Y.V.RAVIRAJ, ADV. FOR R1 TO R3) 2 THIS PETITION IS FILED UNDER ARTICLE 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO (i) QUASH AS FAR AS PETITONER IS CONCENED BY APPROPRIATE WRIT OR ORDER IN NATURE OF CERTIORARI OR OTHERWISE IMPUGNED REJECTED LETTER BEARING NO.ITBA/COM/F/17/2019-20/1025310394(1) DATED 17.02.2020 AND IMPUGNED ORDER BEARING NO.F.NO.STAY PETITION/PR.CIT- HBL/2019-20 DATED 17.03.2020 VIDE ANNEXURES-D AND F RESPECDTIVELY BY 1ST AND 3RD RESPONDENT. ii) ISSUE WRIT OF MANDAMUS OR WRIT OF DIRECTION TO 2ND RESPONDENT AUTHORITY TO CONSIDER APPEAL FILED BY PETITONER BEFORE 2ND RESPONDENT AGAINST IMPUGNED ASSESSMENT ORDER PETITOINER HAS FILED APPEAL IN FORM NO.35, BEFORE 2ND RESPONDENT ON 31.12.2019 VIDE ANNEXURE-B. iii) ISSUE WRIT OF PROHIBITION, DIRECDTING RESPONDENT NO.1 REFRAINS FROM INITIATING RECOVERY PROCEEDINGS AGAINST IMPUGNED ORDER BEARING NO.F.NO. STAY PETITION/PR.CIT-HBL/2019-20, DATED 17.03.2020 VIDE ANNEXURE- F BY 3RD RESPONDENT. THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, COURT MADE FOLLOWING: 3 ORDER captioned writ petition is filed seeking writ of mandamus to direct respondent No.2 authority to consider appeal filed by petitioner before respondent No.2 against impugned assessment order petitioner has filed appeal in Form No.35, before respondent No.2 on 31.12.2019. 2. Brief facts leading to this top noted writ petition are as under: petitioner herein is co-operative society registered under Karnataka Co-operative Society Act, 1959. case of petitioner is that, it has filed return of income on 24.10.2017 declaring gross total income to tune of Rs.34,31,035/- and after claiming deduction under Chapter VIA amounting to Rs.34,31,035/-, declared total income as Nil. authorities have taken up case of petitioner-society for limited scrutiny under CASS by issuing notice under Section 143(2) of Income Act, 4 1961 (for short Act ). petitioner-society has submitted its replies online with hardcopy in tapal. Respondent No.1 rejected petitioner s claim of deduction under Section 80P(2)(a)(i) of Act by placing reliance on judgment of Hon ble Apex Court in case of Citizen Co-operative Credit Society Limited Vs ACIT. case of petitioner is that respondent No.1 also treated unexplained income under Section 68 r/w Section 115BBE of Act, cash deposits made during demonetization period. 3. petitioner being aggrieved by assessment order preferred appeal in Form No.35 before respondent No.2 on 31.12.2019 and same is pending for consideration. Having preferred appeal, petitioner submitted application on 02.01.2020 for grant of stay against assessment order before respondent No.1. said application was rejected by respondent No.1 on ground that 20% of disputed demand is not 5 paid. This compelled petitioner to file application on 24.02.2020 seeking stay of demand for assessment year 2017-18 against assessment order before respondent No.3. Respondent No.3 has rejected application. grievance of petitioner is that order passed by respondent No.3 as per Annexure-F is contrary to material placed on record. order under challenge is not speaking order. next grievance of petitioner is that order passed by respondent No.3 is in gross violation of principles of natural justice. On these set of facts, present writ petition is filed. 4. Learned counsel for petitioner would vehemently argue and contend before this Court that since petitioner is challenging very assessment order pending before respondent No.2, he would request this Court to issue appropriate directions against respondent No.2 to dispose of appeal expeditiously. To buttress his arguments, he would rely on judgment of Co-ordinate 6 Bench of this Court rendered in W.P.4811/2008. Relying on this judgment, he would request this Court to direct respondent No.2 to dispose of appeal by imposing time frame. 5. Per contra, Sri.Y.V.Raviraj, learned counsel appearing for respondents would submit to this Court that this Court exercising jurisdiction under Articles 226 and 227 of Constitution of India cannot entertain present writ petition. He would submit to this Court that order passed by respondent No.3 as per Annexure-F dos not suffer from any infirmities. However, he would submit to this Court that since petitioner has already availed remedy before respondent No.2 challenging assessment order, it is open for petitioner to prosecute appeal. petitioner cannot seek writ of mandamus when matter is already pending before respondent No.2. petitioner is at liberty to seek early hearing of appeal and press for disposal also which is well within 7 reach of petitioner. In this background, indulgence by this Court would not arise. 6. This Court is aware of order passed by Coordinate Bench of this Court rendered in W.P.No.145596/2020, which is identical and is squarely applicable to present case on hand. Paragraph 4 and 5 would answer lis that is raised in present writ petition. This Court relying on judgment rendered in Flipkart India (P), Ltd. Vs. Assistant Commissioner of Income-tax, Circle 3(1)(1), Bengaluru has held that, it is incumbent on Principal Commissioner of Income-Tax to decide on application for stay considering two questions, viz., whether assessment is unreasonably high-pitched and whether petitioner would be put to genuine hardship because of such assessment. This Court while examining order of authority was of view that order under challenge is not at all speaking order and accordingly, this Court set aside order and 8 remitted back for fresh consideration. facts in present case are replica and identical. 7. On perusal of impugned order passed by respondent No.3 as per Annexure-F, it is clearly evident that there is totally non-application of mind. authority has not at all examined as to whether assessment is unreasonably high-pitched and whether assessment order has caused genuine hardship because of such assessment. No reasons are forthcoming in order passed by respondent No.3 as per Annexure-F. It is also forthcoming that this order is passed in gross violation of principles of natural justice. No opportunity was granted to petitioner to put forth his case. This Court is of view that order under challenge is not at all speaking order and same is bad in law. 8. For reasons stated supra, order passed by respondent No.3 as per Annexure-F is not sustainable. Accordingly, I pass following: 9 ORDER writ petition is allowed. impugned order passed by respondent No.3 dated 17.03.2020 as per Annexure-F is quashed. matter is remitted back to respondent No.3 for fresh consideration. On receipt of order passed by this Court, respondent No.3 is required to fix date and after hearing petitioner shall pass appropriate orders in accordance with law. Sd/- JUDGE MBS/- Shri Saleshwar Pattin Sahakari Sangha Niyamit v. Income-tax Officer Ward 1, Bagalkote / Commissioner of Income-tax (Appeals), Belagavi / Principal Commissioner of Income-tax, (Administration), Hubballi