Krishnam Raiu Gumma V. The Union of India and The Income Tax Officer, Circle 9(1) and The Assessment Unit, National Faceless Assessment Centre, Income Tax Department

WP/23417/2024

AI Insights

The case involves Krishnam Raiu Gumma, the petitioner, challenging the notices and assessment orders issued by the Income Tax Department under Sections 147 and 148 of the Income Tax Act, 1961, for the Assessment Year 2015-16. The petitioner argued that the notices were issued without jurisdiction and were contrary to the law as established by the High Court in a previous batch of writ petitions. The respondents included the Union of India, represented by the Secretary of the Department of Revenue, and the Income Tax Officer, Circle 9(1), among others. The court referenced a common order from a related batch of writ petitions (W.P.No.25903 of 2022) decided on 14.09.2023, which had set a precedent that the procedures followed by the Income Tax Department were not in accordance with the amended provisions of the Finance Act, 2021.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 703131 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 29-08-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal vs. Revenue
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: B MUKHERJEE; B SAPNA REDDY
• Assessee Lawyers: T PRADYOTH
• Keywords: Assessment Order; Finance act; Income Tax; Jurisdiction; Reassessment; Writ of Mandamus
• Section: 147; 148; 151; 226; 144F

Judgement Text

"I I 134111 HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (SPecial Original Jurisdiction) THURSDAY, THE TWENTY NINTH DAY OF AUGUST TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION NO: 23417 0F 2024 Between: Krishnam Raiu Gumma. S/o. Ram Raiu Gumma, age.33 Years' Add'16-2- iii)d lozii' iairim cotonv, saidabad, Hvderabad 500060, lndia-presently i.rio'ing -it ico pnnxuo'use couRT,' HATFIELD, AL10 9E' United Kingdom. ...PETITIONER AND 1. The Union of lndia, Represented by its Secretary, Department of Revenue, Ministry of Finance, New Delhi. 2. The lncome Tax Officer, Circle 9(1), IT Towers' AC Guards, Masak Tank' Hyderabad, Telangana-500004. 3. The Assessment Unit, National Faceless Assessment centre, lncome Tax Department' New Delhi ...RES'oNDENTS Petition under Article 226 of the constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to issue a writ, order or Direction more particularly one in the nature of a Writ of Mandamus, declaring the impugned notice issued by the 2nd Respondent u/s 148 of the Act bearing DIN and Notice No' ITBA/AST/S/148-1t2022-2311042708343(1)dated1210412022andme consequent Assessment Order passed by the Respondent No' 3 u/s 147 read with Section 144F of the lncome Tax Act, 1961 bearing DIN No.ITBA/AST/S114712023-241L061565426(1) dated 2710212024 for the Assessment Year 2015-16, as arbitrary, illegal, bad in law, issued without .lurisdiction and as against the law laid down by this Honble court in writ Petition , /; No. '15383 of 2023 and batch dated 1410912023 and to consequenfly set aside the same. lA NO: 1 OF 2024 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 further stay all the proceedings in pursuance of the impugned Assessment Order issued by the 3rd Respondent uls 147 of the At bearing DIN and Notice No. lT3tuAST/Si147 12023-24 /1 06 1 565426(1 ) dated 27 t02/2024 for the Assessment Year 2015-16. Counsel for the Petitioner: SRI T.PRADYOTH Counsel for the Respondent No.1 & 3: SRI B.MUKHERJEE, REp. FOR SRI GADI PRAVEEN KUMAR, Dy. SOLICITOR GEN. OF INDIA Counsel for the Respondent No.2: M/s. B.SAPNA REDDY, Jr. SC FOR INCOME TAX DEPT. The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION No.23417 0T 2024 ORDER: (per Hon'bte Justice Sujog Paul) Heard Sri T.Pradyoth, learned counsel for the petitioner, Ms.B.Sapna Reddy, learned Junior Standing Counsel for Income Tax Department for the respondents- Income Tax Department and Sri B' Mukherjee' learned counsel representing Sri Gadi Praveen Kumar' learned Deputy Solicitor General of India for the respondents-Central Government 2. The ground taken by the learned counsel for the petitioner(s) is that in furtherance of Finance Act' 2O2l' te- assessment process stood modilied but the respondents have not taken care of it and therefore notice issued under Section 1 48 of the Income Tax Act, 196 1 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 finally drawn by this Court in a batch of writ petitions, W'P'No'25903 of 2022 andotherconnectedmatters,decidedbycommonorder 2 dated 14.09.2023. Thre parties agreed that this matter ma)r be disposed of in tcrms of the Common Order dated 14.O9.2023. 4. This Court in the said order dated 1 4.O9 .2O23 in W.P.No.259O3 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 iespoudent- Department upon treating the lotices issued for reassessmeEt being uader Section 148A, the subsequent proceedings was mandatorily required to be undertakea ulder the substituted provisions as taid down under the Finaace Act,2021. In the absence of shich, we are coastraitred to hold that the p.ocedure adopted by the respondent-Department is in contravention to the statute i.e. the Finance Act, 2021, at the first iDstance. Secondly, it is also in direct colrtraveDtiotr to the directives issued by the Hon'ble Supreme Court in the case of Ashish Agarwal, supra. 36. For all the aforesaid reasors, the iEpugaed notices issued and the proceediugs drara by the tespondent-DepartEeat is neithet tenable, r1or sustainable. The aotices so issued and the procedure adopted beiag per se iuegal, desewes to be and are accordiugly set aside/quashed. As a conscqueace, all the impugned orders gettiag quashed, the colsequential orders passed by the .espordent Department pursuant to the notices issued under Section 147 and 148 would also get quashed and it is ordered accordingly. The reasoE we are quashitg the coosequential order is o! thc pritciples that when the initiation of the proceediDgs itself was procedurally wrong, the subsequent orders also gets nullified automatically. 37. The preliEinary objection raised by the petitioner is sustained and all these writ petitions stalrds allowed on this very jurisdictional issue. Sitrce the impugred notic€s and orders are getting quashed on the poiat ofjurisdiction, we are not inclined to proceed further aad decide the other issues raised by the petltioner whiclt stands reserved to be raised and cotrtended ia an appropriate proceedlugs. 38. Since the Hon'ble Supreme Court had, in the case of Ashish Agarwal, supta, as a one-time rdeasure exercisi g the powers uuder Article 142 of the Constitution of India, t,j permitted the Rewenue to ltroceed undet the substituted p.ori\"ioo\", snd this Court allowing the petitioas only ol the procedurat flaw, the right cotrfcrrcd on the Reveaue would r.mair, .\"\"\"*\"d to Proceed further if they so want froa the stage of the order of the supreme court itr the case of Ashish Agarwal, suPr\"a. 39. No otder as to costs'' 5. In view of the consensus arrived' the impugned Show Causenoticeandconsequentialord.erspassedinthiswrit petition a-re 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 14'09'2023 in W.P.No.259O3 of 2022 6. The writ petition is a'llowed' No costs' Interlocutory applications, if any pending' shall also stand closed' SD ASSISTANT KAVITHA GISTRAR l-v. ,ITRUE COPY'I SE loN oFFICER To, The Secretary, Department of Revenue' Ministry of Finance' New Delhi' :[Tifi':;il\"3il5ir36'Sf e(1)' I r rowers' Ac Guards' Masak rank' The Assessment !nit'. National Faceless Assessment Centre' lncome Tax DePartment, New uetnt One CC to SRI T PRADYOTH' Advocate [OPUC] One CC to M/s B SAPNA REDDY' Jr' SC FOR INCOME TAX DEPT TOPUCI i tt ::,t ,:nf t?i : H5, 5SSYYf fu i\"i\" ;S'i crro R G E N o F I N D rA' 1 2 7. Two CD CoPies BSR J. 4 5 o GJ P t HIGH COURT DATED: 2910812024 irrr r' lE .liI ( 4 .{. 'o r, ,fi ,xt 2tr8 o ,1 ($ ORDE WP.No.23417 of 2024 ALLOWING THE WRIT PETITION, WITHOUT COSTS @. 6tt JN b* "