Kerala HC rejects Contention of non-receipt of Notice, upholds Reopening of Assessment against Co-Op Society [Read Order]
“this contention cannot be accepted in view of the system which has been placed for communication of notices, orders etc”, said Kerala HC, in reply to plea of non-receipt of notices
co-op society – kerala high court – Reopening of Assessment – taxscan
co-op society – kerala high court – Reopening of Assessment – taxscan
In a significant ruling, the Kerala High Court dismissed a writ petition challenging the assessment order and demand related to the assessment year 2016-2017. The petitioner, a cooperative society, failed to file returns for the said year, prompting the tax authorities to reopen the assessment.
The case came into focus due to substantial cash deposits during the financial years 2015-2016 and 2016-2017, as revealed by Multi-layer NMS cases in the AIMS module of ITBA. The Income Tax Department initiated the reopening of the petitioner's case by issuing a notice under Section 148 of the Income Tax Act, 1961.
Despite receiving the notice, the petitioner filed the return of income on 29.04.2021, declaring total income as 'Nil' after claiming a deduction under Chapter VIA (80P) of Rs. 2,64,133/-.
Subsequent notices under Section 142(1) of the Income Tax Act dated 08.07.2021 and 18.11.2021 were issued, but the petitioner failed to respond. The final opportunity, provided on 24.02.2022, also went unanswered.
In response to the non-cooperation, the Income Tax Department passed an ex-parte assessment order under Section 144 of the Income Tax Act. The petitioner did not submit the return in response to the initial notice under Section 148.
Represented by Advocates V P Narayanan and Alan Priyadarshi Dev, the petitioner sought to quash the reassessment proceedings and demand raised thereafter.
Advocates P G Jayashankar and Keerthivas Giri represented the revenue.
The petitioner's contention that they did not receive the notice was rejected by the court, emphasizing the established system for communication of notices, orders, etc. The court found no grounds to entertain the writ petition against the impugned assessment order.
As a result, the writ petition was dismissed, with the court leaving it open for the petitioner to pursue remedies, including the option to appeal. The court directed any appeal to be decided expeditiously and in accordance with the law.
This ruling underscores the importance of timely and diligent compliance with tax proceedings and highlights the Kerala High Court’s recognition of the established communication system for notices in legal matters.
To Read the full text of the Order CLICK HERE
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