ARYAVRATHA BUILDERS AND DEVELOPERS V. THE INCOME TAX OFFICER

WP/24210/2021

AI Insights

The case involves two writ petitions filed under Articles 226 and 227 of the Constitution of India, challenging notices issued under Section 148 of the Income Tax Act, 1961. The petitioners, Aryavratha Builders and Developers and Jagaralamudi Loknath Babu Naidu, contested the validity of the notices and certain notifications issued by the Central Board of Direct Taxes (CBDT) as being ultra vires the Income Tax Act, 1961 and the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. The court examined the legal provisions and precedents, ultimately deciding to quash the impugned notice while allowing for the possibility of re-assessment under the amended Act.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 695784 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 19-04-2022
• Assessment Year: misc
• Other Referred Cases: Ashok Kumar Agarwal vs. Union of India, BPIP Infra (P.) Ltd. vs. Income Tax Officer, Ward 4(1), Jaipur, Mon Mohan Kohli vs. Assistant Commissioner of Income Tax & Anr., Tata Communications Transformation Services Limited vs. Assistant Commissioner of Income Tax 14(1) and Others
• Laws Referred To: Income Tax Act 1961, Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act 2020
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND; DILIP M
• Assessee Lawyers: A SHANKAR; S ANNAMALAI; SHREEHARI
• Keywords: Assessment Year; Income Tax; Notice Quashment; Ultra Vires; Writ of Certiorari
• Section: 148

Judgement Text

"1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 19TH DAY OF APRIL 2022 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR.JUSTICE S. VISHWAJITH SHETTY W.P. No.24210 OF 2021 C/W W.P. No.4490 OF 2022 (T-IT) IN W.P. No.24210 OF 2021 BETWEEN: ARYAVRATHA BUILDERS AND DEVELOPERS REP BY ITS PARTNER SRI. G. DASARATHARAMI REDDY S/O SRI. G. PAPI REDDY AGED 64 YEAS FLAT NO.303, NO 841/B SRI LAKSHMI NEST APARTMENT 5TH CROSS, 10TH MAIN INDIRANAGAR II STAGE BENGALURU 5600068. ... PETITIONER (BY MR. A. SHANKAR, SR. COUNSEL FOR MR. S. ANNAMALAI, ADV.,) AND: 1. THE INCOME TAX OFFICER WAR 1(2)(1), BMTC BUILDIJG 80 FEET ROAD, 6TH BLOCK NEAR KHB GAMES VILLGE KORAMANGALA, BENGALURU 560095. 2 2. CENTRAL BOARD OF DIRECT TAXES THROUGH THE CHAIRPERSON DEPARTMENT OF REVENUE MINISTRY OF FINANCE NORTH BLOCK, NEW DELHI 110002. 3. THE PRINCIPAL COMMISSIONER OF INCOME TAX BENGALURU -1, BMTC BUILDING 80 FEET ROAD, 6TH BLOKC NEAR KHB GAMES VILLAGE KORAMANGALA, BENGALURU 560095. ... RESPONDENTS (BY MR. K.V. ARAVIND A/W MR. DILIP .M , ADVS.,) - - - THIS W.P. IS FILED UNDER ARTICLE 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT OF CERTIORARI AND DIRECTION IN THE NATURE OF A WRIT OF CERTIORARI QUASHING THE NOTICE ISSUED UNDER SECTION 148 OF THE INCOME TAX ACT 1961 DATED 30.06.2021 FOR THE ASSESSMENT YEAR 2013-14 IN DIN AND NOTICE NO.ITBA/AST/148/2021-22/1033904402(1) HERE IN MARKED AS ANNEXURE-A. DECLARE THE EXPLANATION BELOW CLAUSE (A) IN THE NOTIFICATION BEARING NO 20/2021/F.NO/370142/35/2020-TPL DATED 27.04.2021 HERE IN MARKED AS ANNEXURE-C ISSUED BY THE RESPONDENT NO.2 IS ULTRA VIRES THE PROVISIONS OF THE INCOME TAX ACT 1961 AND THE PROVISIONS OF THE TAXATION AND OTHER LAWS (RELAXATION AND AMENDMENT OF CERTAIN PROVISIONS) ACT 2020 & ETC., IN W.P. No.4490 OF 2022 BETWEEN: JAGARALAMUDI LOKNATH BABU NAIDU S/O VENKATASWAMY NAIDU J 3 AGED 60 YEARS NO.93, 21ST MAIN, BANASHANKARI 2ND STAGE BENGALURU-560 070. ... PETITIONER (BY MR. SHREEHARI, ADV.,) AND: 1. INCOME TAX OFFICER WARD 7(2)(5), BENGALURU BMTC BUILDING, 100 FT ROAD KORAMANGALA, BENGLAURU-560 095. 2. UNION OF INDIA REP. BY THE DIRECTOR DEPT. OF REVENUE UNDER MINISTRY OF FINANCE ROOM NO.46, NORTH BLOCK NEW DELHI-D110001. 3. CENTRAL BOARD OF DIRECT TAXES REP. BY THE CHAIRMAN, NORTH BLOCK NEW DELHI-110 002. ... RESPONDENTS (BY MR. K.V. ARAVIND A/W MR. DILIP M, ADVS.,) - - - THIS W.P. IS FILED UNDER ARTICLE 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT OF CERTIORARI OR DIRECTION IN THE NATURE OF WRIT OF CERTIORARI QUASHING THE NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT, 1961 DATED 15.06.2021 ISSUED BY THE RESPONDENT No-1 FOR THE ASSESSMENT YEAR 2017-18 BEARING DIN ITBA/AST/S/148/2021-22/1033475134(1) ENCLOSED AT ANNEXURE-A. ISSUE A WRIT DECLARING THAT THE EXPLANATION A(a)(ii) TO THE NOTIFICATION S.O.1432(E) (No.20/2020/F.No.370142/35/2020-TPL), DATED 31.03.2021 ISSUED BY THE RESPONDENT No.2 THROUGH THE RESPONDENT No.3 IS ULTRA VIRES THE TAXATION AND OTHER LAWS 4 (RELAXATION AND AMENDMENT OF CERTAIN PROVISIONS) ACT, 2020 WHICH IS ENCLOSED AS ANNEXURE-B. ISSUE A SUITABLE WRIT DECLARING THAT THE EXPLANATION A(b) TO THE NOTIFICATION S.O.1703(E) (No.38/2021/F.No.370142/35/2020- TPL) DATED 27.04.2021 ISSUED BY THE RESPONDENT No-2 THROUGH THE RESPONDENT No.3 IS ULTRA VIRES THE TAXATION AND OTHER LAWS (RELAXATION AND AMENDMENT OF CERTAIN PROVISIONS) ACT 2020 WHICH IS ENCLOSED AS ANNEXURE-C. THESE W.Ps. COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, ALOK ARADHE J., MADE THE FOLLOWING: ORDER The petitioner in these writ petitions has sought quashment of explanation below Clause (A) in the notification bearing No.20/2021370142/35/2020-tl dated 31.03.2021 and notification No.38/2021f. No.370142/35/2020-TPL dated 27.04.2021 issued by Central Board of Direct Taxes, as ultra vires the provisions of Income Tax Act, 1961 (hereinafter referred to as ‘1961 Act’ for short) and the provisions of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (hereinafter referred to as ‘2020 Act’ for short). The 5 petitioner has also prayed for relief that extension of time limit by the 2020 Act does not apply to notices issued under erstwhile Section 148 of the 1961 Act, after 01.04.2021. The petitioner also seeks a writ of certiorari for quashing the notice dated 30.06.2021 issued under Section 148 of the 1961 Act for the Assessment year 2016-17. In order to appreciate the petitioner’s grievance, few relevant facts need mention, which are stated infra. 2. We have heard learned counsel for the parties at length. For the reasons assigned by us in the judgment dated 18.04.2022 passed in W.P.No.22348/2021 and the division bench decisions of High Court of Allahabad in ASHOK KUAR AGARWAL VS. UNION OF INDIA’, Rajasthan High Court in ‘BPIP INFRA (P.) LTD. VS. INCOME TAX OFFICER, WARD 4(1), JAIPUR, Delhi High Court decision in MON MOHAN KOHLI VS. ASSISTANT 6 COMMISSIONER OF INCOME TAX & ANR. And decision of Bombay High Court in TATA COMMUNICATIONS TRANSFORMATION SERVICES LIMITED, VS. ASSISTANT COMMISSIONER OF INCOME TAX 14(1) AND OTHERS, W.P.NO.1334/2021, the impugned notice dated 30.06.2021 issued under Section 148 of the Act is quashed. However, it will be open to the Assessing Officer concerned to initiate fresh re-assessment proceeding in accordance with relevant provisions of the 1961 Act as amended by Finance Act, 2021 after strictly complying with the provisions of the Act. 7 In the result, the writ petitions are disposed of. Sd/- JUDGE Sd/- JUDGE SS "