IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
[Original Jurisdiction]
WRIT PETITION NO: OF 2015
BETWEEN:
1)
2]
Chandramappa RamannaDhavalagi,age about 45Years,occupation-CharteredAccountant,Past presidentKSCAA,Dhavalgi Chambers,NCM,Hubli,
Vivek Lingappa Urankar,ageabout 52 years,occupation-Taxpracticenor ,GGF-53,Harekrishna chamber, Laxmicomplex,Hubli.
PETITIONER No.1
PETITIONER No.2
A N D :
1) Union of IndiaMinistry of Finance, Departmentof Revenue, North BlockNew Delhi : 110001
RESPONDENT No.1
2) Central Board of Direct Taxes,North Block, Ministry ofFinance,New Delhi : 110001
RESPONDENT No.2
UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA
IN this, the above named petitioners most respectfully
begs to submit as under:
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1. THAT the petitioner is an Chartered accountant, and ex-
President ,Karnataka State Chartered Accoutants
Association,Bengaluru, carrying on his profession at Dhavalgi
Chambers,New cotton market, Hubli. The petitioner conducts
the Income Tax Audit of individulas, Firms, Corporates,
Banks, Co-operatavie societies under section 44AB in terms of
the Income Tax Act 1961.
2. THAT Section 44AB of The Income Tax Act 1961 providesas under ;
Audit of accounts of certain persons carrying on business
or profession.
44AB. Every person,—
(a) carrying on business shall, if his total sales, turnover or
gross receipts, as the case may be, in business exceed
or exceeds one crore rupees in any previous year; or
(b) carrying on profession shall, if his gross receipts in
profession exceed twenty-five lakh rupees in any
previous year; or
(c) carrying on the business shall, if the profits and gains
from the business are deemed to be the profits and
gains of such person under section 44AE or section
44BB or section 44BBB, as the case may be, and he has
claimed his income to be lower than the profits or gains
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so deemed to be the profits and gains of his business, as
the case may be, in any previous year; or
(d) carrying on the business shall, if the profits and gains
from the business are deemed to be the profits and
gains of such person under section 44AD and he has
claimed such income to be lower than the profits and
gains so deemed to be the profits and gains of his
business and his income exceeds the maximum amount
which is not chargeable to income-tax in any previous
year,
get his accounts of such previous year audited by an
accountant before the specified date and furnish by that date
the report of such audit in the prescribed form duly signed
and verified by such accountant and setting forth such
particulars as may be prescribed :
Explanation.—For the purposes of this section,—
(i) "accountant" shall have the same meaning as in the
Explanation below sub-section (2) of section 288;
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(ii) "specified date", in relation to the accounts of the assessee
of the previous year relevant to an assessment year, means the
due date for furnishing the return of income under sub-
section (1) of section 139.
3. Further Section 139 of the IT Act1961 provides that;
Return of income.
139. (1) Every person,—
(a) being a company or a firm; or
(b) being a person other than a company or a firm, if his total
income or the total income of any other person in respect of
which he is assessable under this Act during the previous year
exceeded the maximum amount which is not chargeable to
income-tax,
shall, on or before the due date, furnish a return of his income
or the income of such other person during the previous year,
in the prescribed form and verified in the prescribed manner
and setting forth such other particulars as may be prescribed :
*
*
Explanation 2.—In this sub-section, "due date" means,—
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(a) where the assessee other than an assessee referred to in
clause (aa) is—
(i) a company; or
(ii) a person (other than a company) whose accounts are
required to be audited under this Act or under any other
law for the time being in force; or
(iii) a working partner of a firm whose accounts are required
to be audited under this Act or under any other law for
the time being in force,
the 30th day of September of the assessment year;
(aa) in the case of an assessee who is required to furnish a
report referred to in section 92E, the 30th day of
November of the assessment year;
(b) in the case of a person other than a company, referred to
in the first proviso to this sub-section, the 31st day of
October of the assessment year;
(c) in the case of any other assessee, the 31st day of July of
the assessment year
4. Further ,Section 2 of the IT Act provides;
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Definitions. In this Act, unless the context otherwise
requires,—*
*
(9) "assessment year" means the period of
twelve months commencing on the 1st day of
April every year ;
5. Further Section 271B of the Act provides as;
Failure to get accounts audited.
271B. If any person fails to get his accounts audited in
respect of any previous year or years relevant to an
assessment year or furnish a report of such audit as
required under section 44AB, the Assessing Officer may
direct that such person shall pay, by way of penalty, a
sum equal to one-half per cent of the total sales, turnover
or gross receipts, as the case may be, in business, or of
the gross receipts in profession, in such previous year or
years or a sum of one hundred fifty thousand rupees,
whichever is less.
6. That , from the provisions above mentioned of the Income
Tax Act.1961, it very clear that persons falling under section
44AB are to get their accounts audited and submit their
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returns on or before the 30th day of September of the
assessment year. If any person fails to get his accounts
audited / fails to submit their returns before the said due
date, he shall have to pay a penalty under section 271B of
the Act, and also interest as per the provisions of section
234A of the Act i.e.
234A. (1) Where the return of income for any
assessment year under sub-section (1) or sub-section (4)
of section 139, or in response to a notice under sub-
section (1) of section 142, is furnished after the due date,
or is not furnished, the assessee shall be liable to pay
simple interest at the rate of one per cent for every month
or part of a month comprised in the period commencing
on the date immediately following the due date.
7. THAT ,from these provisions of law ,the assesse is given a
time period from 1st April to 30th of September [6 months,i.e
about 180 days in all] of the assessment year to get his
accounts audited and to file the returns. This is a statutory
provision.
8. The Government of India, Ministry of Finance,
Department of Revenue have brought some modifications in
the norms of audit and return Forms for the year 2015-2016.
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9. It is the statutory right of every assesse of filing his
returns from 1st day of April and before due date.
10. That for the year 2015-2016, the Ministry of Finance,
Department of Revenue has made available the Return forms
e-enabled only from 7th August 2015, instead of 1-4-2015.
This has caused a delay in notification of forms and
consequently reduction of time wherein the delay in notifying
the forms by the Respondent No.1 and 2 has reduced the time
of filing Income Tax Return by about 122 days .
11. That due to the unjust prejudice and harassment being
caused on account of the aforesaid reduction in time,
attributable to delayed notification of ITR forms, various
representations were filed before the Respondent No.1 and 2,
inter-alia by The Institute of Chartered Accountants of India
(An Autonomous body set under an Act of Parliament) and
other professional bodies to extend the specified date u/s
44AB & also the due date u/s 139(1).
12. However, the Respondent No.1 and 2 without any
application of mind, acting arbitrarily and in unconstitutional
manner did not consider the said representations and denied
to extend the time for filing the Income Tax Return from
30.09.2015 to any further date.
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13. The Government of India, Ministry of Finance,
Department of Revenue,Central Board of Direct Taxes, on 9th
September 2015, released a Press Release stating that “the
last date for filing of returns due by 30th September 2015 will
not be extended”. That the copy of the Press Release Dated
09.09.2015 issued by Respondents and available at the
website of the Press Information Bureau of India (Weblink :
http://pib.nic.in/newsite/erelease.aspx) is annexed herewith
and marked as Annexure A.
14. THAT The Institute of Chartered Accountants of India has
addressed a letter dated 14th September 2014 to the Hon,ble
Finance Minister, Government of India, New Delhi referring the
press release dated 9th September 2015 and requesting him to
extend the due date from 30th September 2015 to 31st October
2015. There is no reply to this letter. That the copy of the
letter dated 14th September 2015 is annexed herewith and
marked as Annexure B.
15.
16. THAT the petitioner has not challenged the refusal of
extension of last date for filing of returns due by 30th
September 2015 by filing any Writ Petition before this Hon’ble
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Court. No other proceeding in respect thereof is pending before
this Hon’ble Court.
17. THAT the petitioner has no other alternate
efficacious remedy at law than to approach this Hon’ble Court
under Articles 226 and 227 of the Constitution of India upon
the following among other
GROUNDS
18. The act of the respondents in refusal of extension of
last date for filing of returns due by 30th September 2015 is
without the authority of law.
19. The Return forms should have been e-enabled on 1st
of April 2015 . The respondents have e-enabled the return
forms only from 7th of August 2015 and thereby reduced the
effective number of days for filing the returns by 122 days,
leaving only about 58 days. This is arbitrary action by the
respondents and is without the authority of law. It is
unreasonable, unjust, illegal and unconstitutional and that
the same is inter-alia, in violation and contravention to Article
14, and Article 19 (1) (g) of the Constitution of India, as the
same is infringing the fundamental rights of equality, trade
and profession which is guaranteed under the Constitution of
India.
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20. That apart from the act of the respondents causing
reduction in effective days for filing returns to onle 58 days
instead of 183 days, there is one more genuine reason for
demanding extension of the due date from 30th September to
any further date.
21. It is a well known fact that these days ,atleast for the
last 65 days , there is a movement going on in the entire State
and particularly in the North Karnataka region centering
Hubli-Dharwd regarding Kalasa-Banduri issue. Due to this
movement a number of “Bundh”s have taken place affecting
normal life including buisiness and profession. Many more
“Bundh”s are proposed before 30th September 2015.
22. These “ Bundh”s have also contributed further in
reducing the available effective number of days for filing the
returns.
23. Under these vague situation and circumstances, the
most affected category of Tax Payers has been the Assesses
including Companies, and Firms and, Individuals and HUF’s,
Engaged in Proprietary Business/Profession etc., whose
Accounts are required to be Audited in terms of the Income
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Tax Act 1961 and who suffered a delay in notification of forms
and consequent reduction of time wherein the delay in
notifying the forms by the Respondents has reduced the time
of filing Income Tax Return by 122 days, making available only
58 days (including Sundays and holidays). Further these 58
days have also been reduced substantially due to the
“Bundh”s on various days during August and September
2015.
24. The statistics extracted from the E-filing portal of the
Income Tax department, reveals almost 73% of the substantial
returns, without considering the increase in section 44AB
cases for F.Y. 2014-15 and F.Y. 2013-14, and amenable to
audits u/s 44AB and falling due to be filed on or by
30.09.2015, are yet pending as on today. The detail so
extracted is as under: -
E-filed returnsduring FY2014-15
Filing Till31/08/2015
Pendingreturnstill date
ITR
Forms
ITR 4 9,343,539 2,713,724 71%
ITR 5 1,065,650 254,994 76%
ITR 6 752,070 45,179
ITR 7 168,017 41,905 75%
TOTAL 11,329,276 3,055,802 73%(Source :- www. Incometaxindiaefiling.gov.in dated 10.9.2015)
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25. The decision of the respondents vide the press
release dated 9th September 2015 of not extending the last
date for filing the returns is unreasonable, arbitrary,
unjustified and unconstitutional, as the same is causing grave
prejudice and harassment, not only to the concerned Tax
Payers but also for the Chartered Accountants community at
large, who are responsible for conducting the tax audit and
further to file the same alongwith the Income Tax Return in
accordance with Law.
26. The Tax Payer as well as the Respondents expect
from the Chartered Accountant a 100% compliance with zero
tolerance while making compliances under the Income Tax
Act. The Chartered Accountant is thus brought under
pressure.
27. On several earlier occassions the last date for filing
various returns have extended by the authorities.
GROUNDS FOR INTERIM PRAYER
28. The decision of the respondents vide the press
release dated 9th September 2015 of not extending the last
date for filing the returns is unreasonable, arbitrary,
unjustified and unconstitutional, as the same is causing grave
prejudice and harassment, not only to the concerned Tax
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Payers but also for the Chartered Accountants community at
large, who are responsible for conducting the tax audit and
further to file the same alongwith the Income Tax Return in
accordance with Law. If the Interim prayer as prayed for
herein below is not granted the petitioners will be put to
incalculabe loss.
PRAYER
29. WHEREFORE, the petitioner prays that this Hon’ble
Court may be pleased to:
(A) Issue a writ in the nature of certiorari or any
other appropriate writ or order or direction declaring
the decision of the Respondent No.1 and 2 vide its
Press Release Dated 09.09.2015 as null and void.
(Annexure M);
(B) issue a writ in the nature of mandamus or any
other appropriate writ or order or direction directing
the respondent No.1 and 2 to extend the last date of
filing of Returns due by 30th September, for Assessment
Year 2015-2016 for Categories of Assesses whose
Accounts are required to be Audited as per Income Tax
Act, 1961 from 30.09.2015 to 31.10.2015; and
(C) Such other orders as deemed fit, be passed.
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DHARWAD21-09-2015
Advocate for the petitioner
INTERIM PRAYER
Pending disposal of the top noted Writ Petition this Hon’ble
Court may be pleased to sta the operation and effect of press
release dated 09-09-2015 (ANNEXURE A)and extend the due
date for filing the returns(ITR).
ADDRESS FOR SERVICE:
Prakash Andanimath Advocate,
“Annapurna”, Vidyanagar,
HUBLI-580031.
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IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
WRIT PETITION NO: OF 2015
BETWEEN:
1)
2]
Chandramappa RamannaDhavalagi,age about 45Years,occupation-CharteredAccountant,Past presidentKSCAA,Dhavalgi Chambers,NCM,Hubli,
Vivek Lingappa Urankar,ageabout 52 years,occupation-Taxpracticenor ,GGF-53,Harekrishna chamber, Laxmicomplex,Hubli.
PETITIONER No.1
PETITIONER No.2
A N D :
1) Union of IndiaMinistry of Finance, Departmentof Revenue, North BlockNew Delhi : 110001
RESPONDENT No.1
2) Central Board of Direct Taxes,North Block, Ministry ofFinance,New Delhi : 110001
RESPONDENT No.2
AFFIDAVIT
In this, I, Chandrashekhar R Dhavalagi, age about 44
years, occupation Chartered Accountant, residing at Hubli
today having come over to Dharwad do hereby state on solemn
affirmation as under:
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1. I am the petitioner in the top-noted Writ Petition. I am
acquainted with the facts of the case. I have been authorised
to file this top noted Writ Petition. Hence I am swearing to this
affidavit.
2. I state that the statement of facts contained in paragraphs
1 to 27 of the accompanying petition are true to the best of my
knowledge and I believe the same to be true and correct.
3. I state that the documents at Annexure A, and B are the
copies of the originals.
DHARWAD21-09-2015 DEPONENT
Identified by
Advocate Roll No:
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IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
WRIT PETITION NO: OF 2015
BETWEEN:
1)
2]
Chandramappa RamannaDhavalagi,age about 45Years,occupation-CharteredAccountant,Past presidentKSCAA,Dhavalgi Chambers,NCM,Hubli,
Vivek Lingappa Urankar,ageabout 52 years,occupation-Taxpracticenor ,GGF-53,Harekrishna chamber, Laxmicomplex,Hubli.
PETITIONER No.1
PETITIONER No.2
A N D :
1) Union of IndiaMinistry of Finance, Departmentof Revenue, North BlockNew Delhi : 110001
RESPONDENT No.1
2) Central Board of Direct Taxes,North Block, Ministry ofFinance,New Delhi : 110001
RESPONDENT No.2
SYNOPSIS
The respondents have made reforms to the Tax return forms
applicable to certain category of Tax Payers / Assesses
including Companies, Firms and Individuals and HUF’s,
Engaged in Proprietary Business/Profession etc., whose
Accounts are required to be Audited in terms of the Income
Tax Act 1961.
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The statutory period for getting the accounts audited under
section 44AB of the Act and filing the returns is from 1st April
to 30th September of the assessing year. This provides 183
effective days for filing the returns.
However, for the year 2015-2016, the return forms were e-
enabled only from 7th August 2015. This has reduced the
effective days for filing the returns by about 122 days , leaving
only 58 days (including Sundays and holidays).
Further, the unrest and the “Bundh”s occassioned due to
“Kalasa- Banduri” issue has affected entire Karnataka and in
particular North Karnataka centering Hubli-Dharwad. These
unforseen circumstances have further reduced the effective
days available for filing return forms. Non-compliance of filing
of returns before due date attracts penalty. Auditors are
subjected to pressure and harassment . Delay in e-enabling of
tax return forms is without any authority of law. It is
arbitrariness on the part of respondents and violative of
constitutional provisions provided under Part III of the
constitution. Hence this Writ Petition.
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CHRONOLOGICAL LIST OF DATES AND EVENTS
Sl No Date Events
1. 01-08-2015 Enabling e-filing of ITR 3,4 and 7
2. 02-08-2015 Enabling e-filing of ITR 5
3. 07-08-2015 Enabling e-filing of ITR 6
4. 09-09-2015 Press Release,refusing extension
5. 14-09-2015 Letter to Hon’ble Finance Minister
DHARWAD21-09-2015 Advocate for the petitioner
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IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
WRIT PETITION NO: OF 2015
BETWEEN:
1)
2]
Chandramappa RamannaDhavalagi,age about 45Years,occupation-CharteredAccountant,Past presidentKSCAA,Dhavalgi Chambers,NCM,Hubli,
Vivek Lingappa Urankar,ageabout 52 years,occupation-Taxpracticenor ,GGF-53,Harekrishna chamber, Laxmicomplex,Hubli.
PETITIONER No.1
PETITIONER No.2
A N D :
1) Union of IndiaMinistry of Finance, Departmentof Revenue, North BlockNew Delhi : 110001
RESPONDENT No.1
2) Central Board of Direct Taxes,North Block, Ministry ofFinance,New Delhi : 110001
RESPONDENT No.2
INDEX
Sl No Particulars Pages
1. Synopsis
2. Memorandum of Writ Petition
3. Affidavit
4. Annexure A :
5. Annexure B:
6. Vakalat
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DHARWAD21-09-2015
Advocate for the petitioner
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