Ahobala Punnamaraju, W/o Mr. Avasarala Ramakrishna V. Union of India, Ministry of Finance and Principal Chief Commissioner of Income Tax, Hyderabad and Income Tax Officer Ward 8(1), Income Tax Department and National Faceless Assessment Centre, Income Tax Department

WP/20901/2024

AI Insights

The case involves Ahobala Punnamaraju, the petitioner, challenging a notice issued under Section 148 of the Income Tax Act, 1961, by the Income Tax Officer, Hyderabad. The notice was part of a re-assessment process modified by the Finance Act, 2021. The petitioner argued that the respondents failed to adhere to the modified procedures, rendering the notice and all consequential proceedings illegal and without jurisdiction. The court referenced a common order from a batch of writ petitions (W.P.No.25903 of 2022) decided on 14.09.2023, which had similar issues and found in favor of the petitioners, setting aside the notices and proceedings on procedural grounds.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 803982 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 05-08-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: GADI KUMAR; J SUNITHA
• Assessee Lawyers: V ANEESH
• Keywords: Income Tax; Jurisdictional issue; Procedural Law; Re-assessment; Writ of Mandamus
• Section: 148; 151; 226

Judgement Text

"[ 3411 ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE FIFTH DAY OF AUGUST TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITIO N NO: 20901 OF 2024 Between: Ahobala Punnamaraju, W/o Mr. Avasarala Ramakrishna, Aged about 5.9 years' C\"iiO\".t oi e eoi, Aparna Towers, Kondapur, 8.0' Serilingampally, K V. Rangareddy 500084, Telangana, lndia .,...PETITIONER AND .1 . Union of lndia, Ministry of Finance, North Block, New Delhi Represented by its Secretary. 2. Principal chief commissioner of lncome Tax, Hyderabad 2 signature Towers Sv. rub. O P of Kondapur Sy. 37 P of Kothaguda Opp. Botanical Gardens S6rilingampally M R.R. District Hyderabad Telangana. 3. lncome Tax Officer ward 8(1), lncome Tax Department Signature Towers Sy. No. 6 P of Kondapur Sy. 37 P of Kothaguda 0pp. Botanical Gardens Serilingampally M R.R. District Hyderabad Telangana. 4. National Faceless Assessment Centre, lncome Tax Department Room No.40'l 2 Floor E Ramp Jawaharlal Nehru Stadium, Delhi' .....RESPONDENTS Petition Under Article 226 ot lhe constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to issue an appropriate writ, order, direction more particularly one in the nature of a writ of Mandamus declaring the lmpugned Notice dated 30.03.2024 passed by Respondent No. 3 under Section '148 of the lncome Tax Act, 1961 bearing DIN and Notice No. ITBA/AST/S/148_112023-2411063692684(1) and all consequential proceedings as illegal, without jurisdiction' arbitrary and contrary to the provisions of the lncome Tax Act' 196'1 ' I.A.NO:1 OF 2O24 Petition Under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High court may be pleased to stay the operation of the Notice dated 30 03 2024 issued by Respondent No 3 under Section 148 of the lncome Tax Act, 1961 bearing DIN and Notice No' ITBA/AST/S/148112023.2411063692684(1)alltheconseqUentialproceedings pending the consideration of this writ petition Counsel for the Petitioner : SRI V'ANEESH Counsel for the Respondent No'1 : SRI GADI PRAVEEN KUMAR' DEPUW SOLICITOR GENERAL OF INDIA Counsel for the Respondent Nos'2 to 4: M/s J SUNITHA' SC FOR INCOME TAX The Court made the following ORDER THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESTTWAR RAO WRIT PETITION No.2O9O1 OF 2o24 ORDER: (trter Hon'ble Justice Sujog Poul) Heard Sri V.Aneesh, learned counsel for the petitioner(s), Sri B. Mukherjee, learned counsel representing Sri Gadi Praveen Kumar, learned Deputy Solicitor General ol India, for respondent No.1 and Ms. J Sunitha, learned Junior Standing Counsel for Income Tax Department, for respondent Nos.2 to 4. 2. The ground taken by the learned counsel for the petitioner(s) is that in furtherance of Finance Act, 2O21, re- assessment process stood modified but the respondents have not taken care of it and therefore notice issued under Section 148 of the Income Tax Act, 1961 cannot sustain judicial scrutiny. Since notice is bad in law, the consequential orders are also bad in law. 3. During the course of hearing, learned counsel for the parties agreed that curtains on this issue are hna1ly drawn by this Court in a batch of writ petitions, W.P.No'259O3 of 2022 other connected matters, decided by common order and 2 dated 14.09.2023. The parties agreed that this matter may be disposed of in terms of the Common Order dated 14.O9.2023 4. This Court in the said order dated 14.09.2023 in W.P.No.25903 of 2022, held as under: \"35. In view of the aforesaid discussions, it is by now very clear that the procedure to be followed by the respondent- Department upon treating the notlces issucd for reassessrlent being under Sectioa 148A, the subsequert proceedings was mandatorily required to be undertaken uader the substituted provisions as laid down under the Finalce Act, 2021. h the absence of which, we are constrained to hold that the procedure adopted by the respondetrt-Departmeot is in contravention to the statute i.e. the Finance Act, 2O21, at the first instance. Secondly, it is also in direct coEtravention to the directives issued by the Hon'ble Supreme Court in the case of Ashish Agarwal, supra. 36. For all the aforesaid reasors, the impugaed notices issued and the proceedings drawn by the respondetrt-Department is neither tenable, nor sustainable. The trotices so issued and the procedure adopted being per se illegal, deserves to be and are accordingly set aside/quashed. As a coEsequence, all the impugned orders getting quashed, the con6equeEtial orders passcd by the respondent DepartmeEt pursuaat to the notices issued uader Section 147 and 148 woutd also get quashed and it is ordered accordiagly. The reasoa we are quashing the consequential order is on the principles that Ehen the initiation of the proceedings itself was procedurally wrong, the subsequent orders also gets aullified automatically. 37. The preliminary objection raised by the petitioner is sustaiacd and all these writ petitions staEds allowed on this very jurisdictional issue. Since the impugned notices and orders are getting quashed on the point ofjurisdiction, we are not inclined to proceed further and decide the other issues raised by the petitioEer which stands reserved to be raised aEd contended in an appropriate proceedings. 38. SiDce the Hon'ble Supreme Court had, in the case of Ashish Agarwal, supra, as a one-time fircasure exercisiag the posers under Article 142 of the Constitution of India, 3 ../' perEitted the Revenue to proceed utrder thc Eubstituted provisioEs, and this Court allowing tle petitions oEly on the procedural llaw' the right cotrfeEed on the Revenue would remain rcselved to proceed further if they so waat from the st4ge of the order of the Supreme Court itr the case of Ashish Agarrral, supta. 39. I[o order as to costs-' 5. In view of the consensus arrived, the impugned Show Cause notice and consequential orders passed in this writ petition are set aside. Liberty is reserved to both the parties to take respective stand and to proceed in accordance with law as per paragraph No.38 of the order dated 14'09'2O23 in W.P.No.25903 of 2022. 6. The Writ Petition is allowed. No costs' Interlocutory applications, if any pending, shall also stald closed' ,TRUE COPYII SD/- T. JAYASREE ASSISTANT REGISTRAR S TI OFFICER To 1. The Secretary, Union of lndia, Ministry of Finance, North Block, New Delhi' 2. The Principaicfriet Commissioner Of lncome Tax, Hyderabad 2 Signature Towers Sy. No. 6 P of Kondapur Sy. 37 P of KothaguCa Opp. Botanical Gardens Serilingampally M R.R. District Hyderabad Telangana. 3. The lncome tai OfficeiWard B 1 , lncome Tax Department Signature Towers Sy. No. 6 P of Kondapur Sy. 37 P of Kothaquda Opp Botanical GarCens Seritingampally Ir,4 R.R. District Hyderabad Telangana 4. The Nitional Faceless Assessment Centre, lncome Tax Department Room No.401 2 Floor E Ramp Jawaharlal Nehru Stadium Delhi 5. One CC to SRI V.ANEESH, Advocate IOPUC] 6 One CC to SRI GADI PRAVEEN KUMAR, DEPUTY SOLICITOR GENERAL oF rND|A [OPUC] T One CC to M/s J.SUNITHA, SC FOR INCOIME TAX (OPUC) 8. Two CD Copies SA KKS Y t I HIGH COURT DATED:0510812024 ORDER WP.No.20901 of 2024 ALLOWING THE W.P WITHOUT COSTS. --r= 3 .::;ri . 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