C.B.M.WARRIER WARRIER & WARRIER CHARTERED ACCOUNTANTS and ANITHA ZACHARIAH V. UNION OF INDIA and CENTRAL BOARD OF DIRECT TAXES and PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX (NFAC) and CHIEF COMMISSIONER OF INCOME TAX (RFAC) and COMMISSIONER OF INCOME TAX (APPEAL UNIT) and INCOME TAX OFFICER, NON-CORPORATE WARD-1(1)

WP(C)/6116/2021

AI Insights

The case involves multiple writ petitions filed by C.B.M.Warrier Warrier & Warrier Chartered Accountants and Anitha Zachariah against various respondents including the Union of India and the Central Board of Direct Taxes. The petitions challenged the constitutionality of the amendment to Section 250 of the Income Tax Act, 1961, and the resultant Faceless Appeal Scheme, 2021, which initially did not provide for personal hearings. The petitioners argued that the Scheme was against the principles of natural justice and ultra vires Section 250(2) of the Act. However, during the proceedings, the Scheme was amended to include provisions for personal hearings via video conferencing, which resolved the issues raised by the petitioners.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 694459 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 28-05-2024
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: P R KUMAR; T C KRISHNA
• Assessee Lawyers: ANIL NAIR; SREEJITH NAIR; TELMA RAJU; SANGEETH JACOB; CHRISTINA PAUL
• Keywords: Faceless appeal scheme; Natural Justice; Personal hearing; Ultra Vires
• Section: 250

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN TUESDAY, THE 28TH DAY OF MAY 2024 / 7TH JYAISHTA, 1946 WP(C) NO. 1437 OF 2021 PETITIONER: C.B.M.WARRIER WARRIER & WARRIER CHARTERED ACCOUNTANTS, KUTHIRAVATTOM, CALICUT – 673 016. BY ADVS. SRI. ANIL D. NAIR SRI. SREEJITH R.NAIR SMT. TELMA RAJU SRI. SANGEETH JOSEPH JACOB SMT. CHRISTINA ANNA PAUL RESPONDENTS: 1 UNION OF INDIA, NEW DELHI REPRESENTED BY THE SECRETARY TO THE GOVERNMENT OF INDIA, FINANCE DEPARTMENT – 110 001. 2 CENTRAL BOARD OF DIRECT TAXES, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NEW DELHI – 110 001. 3 PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX (NFAC), NEW DELHI – 110 001. 4 CHIEF COMMISSIONER OF INCOME TAX (RFAC), CHENNAI – 600 001. 5 COMMISSIONER OF INCOME TAX (APPEAL UNIT), KOCHI – 682 018. SRI. P.R.AJITH KUMAR – SC SRI. T.C KRISHNA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.05.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 2 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN TUESDAY, THE 28TH DAY OF MAY 2024 / 7TH JYAISHTA, 1946 WP(C) NO. 6074 OF 2021 PETITIONER: ANITHA ZACHARIAH 2554H KARUKAYIL HOUSE, GOLDEN WATERS, CHILAVANOOR ROAD, ELAMKULAM, KOCHI - 682 020. BY ADVS. SRI. M.GOPIKRISHNAN NAMBIAR SRI. K.JOHN MATHAI SRI. JOSON MANAVALAN SRI. KURYAN THOMAS SRI. PAULOSE C. ABRAHAM SRI. RAJA KANNAN SMT. S.PARVATHI RESPONDENTS: 1 UNION OF INDIA REPRESENTED BY ITS REVENUE SECRETARY, MINISTRY OF FINANCE, NEW DELHI - 110 004. 2 THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, (NATIONAL FACELESS APPEAL CENTRE), NEW DELHI - 110 001. 3 THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, KOCHI, ERNAKULAM - 682 018. 4 THE COMMISSIONER OF INCOME TAX (APPEALS), POORNIMA BUILDINGS, PANAMPILLY NAGAR, KOCHI - 682 036. WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 3 5 THE INCOME TAX OFFICER, NON-CORPORATE WARD -1(1), RANGE 1, C.R.BUILDINGS, I.S PRESS ROAD, KOCHI - 682 018. SRI. P.R.AJITH KUMAR – SC SRI. T.C KRISHNA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.05.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 4 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN TUESDAY, THE 28TH DAY OF MAY 2024 / 7TH JYAISHTA, 1946 WP(C) NO. 6085 OF 2021 PETITIONER: ANITHA ZACHARIAH 2554H KARUKAYIL HOUSE, GOLDEN WATERS, CHILAVANOOR ROAD, ELAMKULAM, KOCHI – 682 020. BY ADVS. SRI. M.GOPIKRISHNAN NAMBIAR SRI. K.JOHN MATHAI SRI. JOSON MANAVALAN SRI. KURYAN THOMAS SRI. PAULOSE C. ABRAHAM SRI. RAJA KANNAN SMT. S.PARVATHI RESPONDENTS: 1 UNION OF INDIA REPRESENTED BY ITS REVENUE SECRETARY, MINISTRY OF FINANCE, NEW DELHI – 110 004. 2 THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, (NATIONAL FACELESS APPEAL CENTRE), NEW DELHI – 110 001. 3 THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, KOCHI, ERNAKULAM – 682 018. 4 THE COMMISSIONER OF INCOME TAX (APPELAS), POORNIMA BUILDINGS, PANAMPILLY NAGAR, KOCHI – 682 036. WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 5 5 THE INCOME TAX OFFICER NON-CORPORATE WARD-1 (1), RANGE 1, C.R. BUILDINGS, I.S. PRESS ROAD, KOCHI – 682 018. SRI. P.R.AJITH KUMAR – SC SRI. T.C KRISHNA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.05.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 6 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN TUESDAY, THE 28TH DAY OF MAY 2024 / 7TH JYAISHTA, 1946 WP(C) NO. 6088 OF 2021 PETITIONER: ANITHA ZACHARIAH 2554H KARUKAYIL HOUSE, GOLDEN WATERS, CHILAVANOOR ROAD, ELAMKULAM, KOCHI - 682 020. BY ADVS. SRI. M.GOPIKRISHNAN NAMBIAR SRI. K.JOHN MATHAI SRI. JOSON MANAVALAN SRI. KURYAN THOMAS SRI. PAULOSE C. ABRAHAM SRI. RAJAKANNAN SMT. S.PARVATHI RESPONDENTS: 1 UNION OF INDIA REPRESENTED BY ITS REVENUE SECRETARY, MINISTRY OF FINANCE, NEW DELHI - 110 004. 2 THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, (NATIONAL FACELESS APPEAL CENTRE), NOW DELHI - 110 001. 3 THE COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE, KOCHI, ERNAKULAM - 682 018. 4 THE COMMISSIONER OF INCOME TAX (APPEALS), POORNIMA BUILDINGS, PANAMPILLY NAGAR, KOCHI - 682 036. WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 7 5 THE INCOME TAX OFFICER, NON-CORPORATE WARD-1 (1), RANGE1, C.R. BUILDINGS, I.S PRESS ROAD, KOCHI - 682 018. SRI. P.R.AJITH KUMAR – SC SRI. T.C KRISHNA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.05.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 8 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN TUESDAY, THE 28TH DAY OF MAY 2024 / 7TH JYAISHTA, 1946 WP(C) NO. 6116 OF 2021 PETITIONER: ANITHA ZACHARIAH 2554H KARUKAYIL HOUSE, GOLDEN WATERS, CHILAVANOOR ROAD, ELAMKULAM, KOCHI - 682 020. BY ADVS. SRI. M.GOPIKRISHNAN NAMBIAR SRI. K.JOHN MATHAI SRI. JOSON MANAVALAN SRI. KURYAN THOMAS SRI. PAULOSE C. ABRAHAM SRI. RAJA KANNAN SMT. S.PARVATHI RESPONDENTS: 1 UNION OF INDIA REPRESENTED BY ITS REVENUE SECRETARY, MINISTRY OF FINANCE, NEW DELHI - 110 004. 2 THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, (NATIONAL FACELESS APPEAL CENTRE), NEW DELHI - 110 001. 3 THE COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE, KOCHI, ERNAKULAM - 682 018. 4 THE COMMISSIONER OF INCOME TAX (APPEALS), POORNIMA BUILDINGS, PANAMPILLY NAGAR, KOCHI - 682 036. WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 9 5 THE INCOME TAX OFFICER, NON-CORPORATE WARD-1 (1), RANGE 1, C.R.BUILDINGS, I.S PRESS ROAD, KOCHI - 682 018. SRI. P.R.AJITH KUMAR – SC SRI. T.C KRISHNA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.05.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 10 JUDGMENT These writ petitions are filed to declare that Ext.P3 amendment to Section 250 of the Income T ax Act, 1961 (for short, ‘the Act’) and resultant Ext.P4 scheme as unconstitutional. It is contended that the Scheme does not contain a provision to give an opportunity of personal hearing to the appellants and is therefore against the principles of natural justice and ultra vires Section 250(2) of the Act. 2. During the pendency of these writ petitions, the Government of India has brought out Faceless Appeal Scheme, 2021 (for short, ‘the Scheme’) as per Notification No.S.O.5429(E) dated 28.12.2021. Clause 12(2) and (3) of the Scheme read as follows:- “12. No personal appearance in the Centres or Units.- (1) xxxxx (2) The appellant or his authorised representative, as the case may be, may request for personal hearing so as to make his oral submission or present his case before the Commissioner (Appeals), through the National WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 11 Faceless Appeal Centre, under this Scheme. (3) The concerned Commissioner (Appeals) shall allow the request for personal hearing and communicate the date and time of hearing to the appellant through the National Faceless Appeal Centre.” As per the amended Scheme, opportunity of personal hearing through video conferencing has been made mandatory. In view of the above amendment, the grievance of the petitioners raised in the writ petitions does not survive. Accordingly, these writ petitions are disposed of with a direction to the appellate authority to consider and dispose of the appeals filed by the petitioners in terms of the provisions of the Scheme issued vide Notification No.S.O.5429(E) dated 28.12.2021. Sd/- MURALI PURUSHOTHAMAN JUDGE SPR WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 12 APPENDIX OF WP(C) 1437/2021 PETITIONER’ S EXHIBITS :- EXHIBIT P1 TRUE COPY OF THE NOTICE ISSUED BY THE OFFICE OF THE REGULAR COMMISSION OF INCOME TAX, APPEAL, KOCHI, DATED 29.12.2020. EXHIBIT P2 TRUE COPY OF THE NOTICE ISSUED BY THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEALS CENTRE (NFAC), DELHI DATED 31.12.2020. EXHIBIT P3 TRUE COPY OF THE NOTIFICATION NO.76/2020(F.NO.370142/33/2020-TPL)/SO32 96(E) DATED 25.09.2020. EXHIBIT P4 TRUE COPY OF THE NOTIFICATION NO.77/2020(F.NO.370142/33/2020-TPL)/SO32 97(E) DATED 25.09.2020. EXHIBIT P5 TRUE COPY OF THE NOTIFICATION NO.80/2020(F.NO.279/MISC./66/2014- SO3308(E) DATED 25.09.2020. EXHIBIT P6 TRUE COPY OF THE NOTIFICATION NO.81/2020(F.NO.279/MISC./66/2014- SO3309(E) DATED 25.09.2020. RESPONDENTS EXHIBITS: NIL. WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 13 APPENDIX OF WP(C) 6074/2021 PETITIONER’ S EXHIBITS :- EXHIBIT P1 TRUE COPY OF THE ORDER DATED 22.08.2019 ISSUED BY THE 5TH RESPONDENT. EXHIBIT P2 TRUE COPY OF THE APPEAL DATED 09.10.2019 FILED BEFORE THE 4TH RESPONDENT. EXHIBIT P3 TRUE COPY OF THE RELEVANT PAGES OF THE FINANCE ACT, 2020 (NO.12 OF 2020) DATED 27.03.2020. EXHIBIT P4 TRUE COPY OF THE FACELESS APPEAL SCHEME, 2020 DATED 25.09.2020. EXHIBIT P5 TRUE COPY OF THE NOTICE DATED 05.02.2021 ISSUED UNDER SECTION 250 OF THE INCOME TAX ACT. EXHIBIT P6 TRUE COPY OF THE RE-PROCEEDINGS RESPONSE ACKNOWLEDGEMENT DATED NIL. EXHIBIT P7 TRUE COPY OF THE LETTER DATED 01.03.2021 REQUESTING FOR PERSONAL HEARING OF THE APPEAL FILED BEFORE THE 4TH RESPONDENT. RESPONDENT S EXHIBITS :- EXHIBIT R5-A NOTIFICATION DATED 28.12.2021 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES ON THE FACELESS APPEAL SCHEME. WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 14 APPENDIX OF WP(C) 6085/2021 PETITIONER’ S EXHIBITS :- EXHIBIT P1 TRUE COPY OF THE ASSESSMENT ORDER DATED 19.02.2016 ISSUED BY THE 5TH RESPONDENT. EXHIBIT P2 TRUE COPY OF THE APPEAL DATED 13.04.2016 FILED BEFORE THE 4TH RESPONDENT. EXHIBIT P3 TRUE COPY OF THE RELEVANT PAGES OF THE FINANCE ACT, 2020 (NO. 12 OF 2020) DATED 27.03.2020. EXHIBIT P4 TRUE COPY OF THE FACELESS APPEAL SCHEME 2020 DATED 25.09.2020. EXHIBIT P5 TRUE COPY OF THE NOTICE DATED 19.01.2021 ISSUED UNDER SECTION 250 OF THE INCOME TAX ACT. EXHIBIT P6 TRUE COPY OF THE E-PROCEEDINGS RESPONSE ACKNOWLEDGEMENT DATED NIL. EXHIBIT P7 TRUE COPY OF THE LETTER DATED 29.01.2021 REQUESTING FOR PERSONAL HEARING OF THE APPEAL FILED BEFORE THE 4TH RESPONDENT. RESPONDENT S ANNEXURES :- ANNEXURE-A CENTRAL BOARD OF DIRECT TAXES NOTIFICATION DATED 28TH DECEMBER 2021 ON THE FACELESS APPEAL SCHEME. WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 15 APPENDIX OF WP(C) 6088/2021 PETITIONER’S EXHIBITS:- EXHIBIT P1 TRUE COPY OF THE ORDER DATED 30.4.2020 ISSUED BY THE 5TH RESPONDENT. EXHIBIT P2 TRUE COPY OF THE APPEAL DATED 27.5.2020 FILED BEFORE THE 4TH RESPONDENT. EXHIBIT P3 TRUE COPY OF THE RELEVANT PAGES OF THE FINANCE ACT 2020 (NO 12 OF 2020) DATED 27.3.2020. EXHIBIT P4 TRUE COPY OF THE FACELESS APPEAL SCHEME, 2020 DATED 25.9.2020. EXHIBIT P5 TRUE COPY OF THE NOTICE DATED 5.2.2021 ISSUED UNDER SECTION 250 OF THE INCOME TAX ACT. EXHIBIT P6 TRUE COPY OF THE E-PROCEEDINGS RESPONSE ACKNOWLEDGEMENT DATED NIL. EXHIBIT P7 TRUE COPY OF THE LETTER DATED 1.3.2021 REQUESTING FOR PERSONAL HEARING OF THE APPEAL FILED BEFORE THE 4TH RESPONDENT. RESPONDENTS ANNEXURES:- ANNEXURE-A NOTIFICATION DATED 28.12.2021 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES ON THE FACELESS APPEAL SCHEME WP(C).Nos.1437, 6074, 6085, 6088, 6116 OF 2021 16 APPENDIX OF WP(C) 6116/2021 PETITIONER’S EXHIBITS:- EXHIBIT P1 ASSESSMENT ORDER DATED 31.7.2017 ISSUED BY THE 5TH RESPONDENT. EXHIBIT P2 TRUE COPY OF THE APPEAL DATED 12.10.2017 FILED BEFORE THE 4TH RESPONDENT. EXHIBIT P3 TRUE COPY OF THE RELEVANT PAGES OF THE FINANCE ACT 2020 (NO 12 OF 2020) DATED 27.3.2020. EXHIBIT P4 TRUE COPY OF THE FACELESS APPEAL SCHEME 2020 DATED 25.9.2020. EXHIBIT P5 TRUE COPY OF THE NOTICE DATED 21.1.2021 ISSUED UNDER SECTION 250 OF THE INCOME TAX ACT. EXHIBIT P6 TRUE COPY OF THE E-PROCEEDINGS RESPONSE ACKNOWLEDGEMENT DATED NIL. EXHIBIT P7 TRUE COPY OF THE LETTER DATED 29.1.2021 REQUESTING FOR PERSONAL HEARING OF THE APPEAL FILED BEFORE THE 4TH RESPONDENT. RESPONDENTS ANNEXURES:- ANNEXURE-A NOTIFICATION DATED 28.12.2021 ON THE FACELESS APPEAL SCHEME ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES. "