BHORUKA STEEL AND SERVICES LTD V. ASSISTANT COMMISSIONER OF INCOME TAX

WP/2849/2022

AI Insights

The case revolves around the petitioner, Bhoruka Steel and Services Ltd., challenging the legality of certain notifications and a subsequent notice issued under Section 148 of the Income Tax Act, 1961. The notifications, dated 31/03/2021 and 27/04/2021, extended the applicability of specific sections of the Income Tax Act until 30/06/2021, which the petitioner argued was beyond the authority granted by the Relaxation Act. The High Court examined similar cases and precedents, ultimately deciding that the notifications were indeed ultra vires and the notice under Section 148 was illegal, leading to the quashing of both the notifications and the notice.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 771447 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 18-04-2022
• Assessment Year: misc
• Other Referred Cases: ASHOK KUAR 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; M N KUMAR
• Assessee Lawyers: T SURYANARAYANA
• Keywords: Assessment; Jurisdiction; Notice; Quashment; Ultra Vires
• Section: 148; 149; 151

Judgement Text

"1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF APRIL 2022 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR.JUSTICE S. VISHWAJITH SHETTY W.P. No.2849 OF 2022 (T-IT) BETWEEN: BHORUKA STEEL AND SERVICES LTD. 48, HOODI, WHITEFIELD ROAD MAHADEVAPURA – 560048 REP. HEREIN BY ITS DIRECTOR MR. S.N. AGARWAL. ... PETITIONER (BY MR. T. SURYANARAYANA, SR. COUNSEL FOR MRS. TANMAYEE RAJKUMAR, ADV.,) AND: 1. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 1 (1)(1), BMTC BUILDING 6TH BLOCK, 80 FEET ROAD KORAMANGALA, BANGALORE - 560 095. 2. THE PRINCIPAL COMMISSIONER OF INCOME TAX - 1 BMTC BUILDING 6TH BLOCK, 80 FEET ROAD KORAMANGALA, BANGALORE - 560 095. 3. CENTRAL BOARD OF DIRECT TAXES NORTH BLOCK, CENTRAL SECRETARIAT NEW DELHI, DELHI - 110 001 REPRESENTED BY THE SECRETARY TAX POLICY AND LEGISLATION DIVISION. 2 4. THE UNION OF INDIA REPRESENTED HEREIN BY THE FINANCE SECRETARY MINISTRY OF FINANCE DEPARTMENT OF REVENUE GOVERNMENT OF INDIA NORTH BLOCK, NEW DELHI - 110 001. ... RESPONDENTS (BY MR. K.V. ARAVIND, ADV., FOR R1 TO RF3 MR. M.N. KUMAR, CGC FOR R4) - - - THIS W.P. IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASHING THE NOTIFICATIONS DATED 31/03/2021 AND 27/04/2021 BEARING NOS.20/2021/F.NO.370142/35/2020-TPL AND 38/2021/F.NO.370142/35/2020-TPL, RESPECTIVELY, ISSUED BY THE 3RD RESPONDENT (ANNEXURES-D AND E) TO THE EXTENT THAT THEY EXTEND THE APPLICABILITY OF SECTIONS 148, 149 AND 151 OF THE IT ACT UNTIL 30/06/2021 AS BEING ULTRA VIRES THE RELAXATION ACT AND THE IT ACT, AND THEREFORE WITHOUT AUTHORITY OF LAW. QUASHING THE NOTICE DATED 29/06/2021 BEARING NO.ITBA/AST/S/148/2021- 22/1033847065(1) ISSUED BY THE 1ST RESPONDENT (ANNEXURE-F) UNDER SECTION 148 OF THE IT ACT, AS BEING WITHOUT JURISDICTION AND THEREFORE ILLEGAL OR, IN THE ALTERNATIVE IF THIS HON BLE COURT WERE TO HOLD THAT THE PROVISIONS OF THE RELAXATION ACT DELEGATE THE POWER TO THE CENTRAL GOVERNMENT TO MODIFY THE OPERATION OF THE PROVISIONS OF THE IT ACT & ETC. THIS W.P. COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, ALOK ARADHE J., MADE THE FOLLOWING: ORDER The petitioner in this writ petition has sought 3 quashment of explanation below Clause (A) in the notification bearing No.20/2021 F.NO.370142/35/2020-TPL dated 31.03.2021 and notification No.38/2021/F.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 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 notices dated 29.06.2021 issued under Section 148 of the 1961 Act for the Assessment year 2016-17. 2. We have heard the learned counsel for the 4 parties at length. For the reasons assigned by us in the judgment dated 19.04.2022 passed in W.P.No.22348/2021 and for the reasons assigned by division bench 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 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 explanation below Clause (A) in the notification bearing No.20/2021 F.NO.370142/35/2020-TPL dated 31.03.2021 and notification No.38/2021 F.No.370142/35/2020-TPL dated 27.04.2021 issued by Central Board of Direct 5 Taxes is hereby declared as ultra vires the provisions of Income Tax Act, 1961 and the provisions of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. The impugned notice dated 29.06.2021 issued under Section 148 of the Act is quashed. 3. 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. In the result, the writ petition is disposed of. Sd/- JUDGE Sd/- JUDGE SS "