MINDSCAPE ONE MARKETING PRIVATE LIMITED V. DEPUTY COMMISSIONER OF INCOME TAX

CW/6883/2022

AI Insights

The case involves Mindscape One Marketing Private Limited, which has been amalgamated with Ready Roti India Private Limited, challenging the jurisdiction of the Deputy Commissioner of Income Tax, Circle 6, Jaipur, and the Central Board of Direct Taxes, Ministry of Finance, regarding the issuance of a notice under section 148 of the IT Act. The petitioner argued that the notice was issued to a non-existent entity post-amalgamation, rendering it illegal and without jurisdiction. The matter was influenced by a Supreme Court decision in Ashish Agarwal, which addressed similar issues of notice issuance under the IT Act. The High Court of Rajasthan decided the writ petition in accordance with the Supreme Court's directions, allowing the petitioner to raise further issues if necessary.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 748450 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 10-05-2022
• Assessment Year: misc
• Other Referred Cases: Union of India & Others Vs. Ashish Agarwal
• Laws Referred To: Income Tax Act, Companies Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: NIKHIL SIMLOTE
• Assessee Lawyers: SIDDHARTH RANKA
• Keywords: Amalgamation; Assessment; Jurisdiction; Notice; Show cause notice
• Section: 148; 148A; 391; 394

Judgement Text

"HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 6883/2022 Mindscape One Marketing Private Limited (Since Amalgamated with Ready Roti India Private Limited) Having its address at F- 28, RIICO Industrial Area, Sare Khurd, Tehsil Tijara, Alwar- 301707 Earlier at L-37, Income Tax Colony, Tonk Road, Jaipur – 302018. Through its Director Shri Subhash Chandra Agarwal. ----Petitioner Versus 1. Deputy Commissioner Of Income Tax, Circle 6, Jaipur having its address at New Central Revenue Building, Bhagwan Dass Road, Jaipur 302005. 2. Central Board of Direct Taxes, Ministry of Finance, Having its address at North Block, New Delhi-110011 through its Chairman. ----Respondents For Petitioner(s) : Mr. Siddharth Ranka, Advocate For Respondent(s) : Mr. Nikhil Simlote, Advocate HON'BLE MR. JUSTICE PRAKASH GUPTA HON'BLE MR. JUSTICE SAMEER JAIN Order 10/05/2022 1. Learned counsel for the petitioner at the very outset has submitted that the matter is covered by order dated 04.05.2022 passed by the Hon’ble Supreme Court in the case of Union of India & Others Vs. Ashish Agarwal (Civil Appeal No. 3005/2022 and batch of appeals). 2. In the light of above submissions, the present petition is decided accordingly with the following directions issued by the Hon’ble Supreme Court in the case of Ashish Agarwal (supra): (2 of 4) [CW-6883/2022] “10. In view of the above and for the reasons stated above, the present Appeals are ALLOWED IN PART. The impugned common judgments and orders passed by the High Court of Judicature at Allahabad in W.T. No. 524/2021 and other allied tax appeals/petitions, is/are hereby modified and substituted as under:- (i) The impugned section 148 notices issued to the respective assessees which were issued under unamended section 148 of the IT Act, which were the subject matter of writ petitions before the various respective High Courts shall be deemed to have been issued under section 148A of the IT Act as substituted by the Finance Act, 2021 and construed or treated to be show-cause notices in terms of section 148A(b). The assessing officer shall, within thirty days from today provide to the respective assessees information and material relied upon by the Revenue, so that the assessees can reply to the show-cause notices within two weeks thereafter; (ii) The requirement of conducting any enquiry, if required, with the prior approval of specified authority under section 148A(a) is hereby dispensed with as a one-time measure vis-à-vis those notices which have been issued under section 148 of the unamended Act from 01.04.2021 till date, including those which have been quashed by the High Courts. Even otherwise as observed hereinabove holding any enquiry with the prior approval of specified authority is not mandatory but it is for the concerned Assessing Officer to hold any enquiry, if required; (iii) The assessing officers shall thereafter pass orders in terms of section 148A(d) in respect of each of the concerned assessees; Thereafter after following the procedure as required under section 148A may issue notice under section 148 (as substituted); (iv) All defences which may be available to the assessees including those available under section 149 of the IT Act and all rights and contentions which may be available to the concerned assessees and Revenue under the Finance Act, 2021 and in law shall continue to be available. 11. The present order shall be applicable PAN INDIA and all judgments and orders passed by different High Courts on the issue and under which (3 of 4) [CW-6883/2022] similar notices which were issued after 01.04.2021 issued under section 148 of the Act are set aside and shall be governed by the present order and shall stand modified to the aforesaid extent. The present order is passed in exercise of powers under Article 142 of the Constitution of India so as to avoid any further appeals by the Revenue on the very issue by challenging similar judgments and orders, with a view not to burden this Court with approximately 9000 appeals. We also observe that present order shall also govern the pending writ petitions, pending before various High Courts in which similar notices under Section 148 of the Act issued after 01.04.2021 are under challenge. 12. The impugned common judgments and orders passed by the High Court of Allahabad and the similar judgments and orders passed by various High Courts, more particularly, the respective judgments and orders passed by the various High Courts particulars of which are mentioned hereinabove, shall stand modified/substituted to the aforesaid extent only. All these appeals are accordingly partly allowed to the aforesaid extent. In the facts of the case, there shall be no order as to costs.” 3. In addition to the above, he has submitted that the petitioner – Company has been merged with M/s. Ready Roti India Private Limited with effect from 01.04.2015. Order was passed under Section 391 - 394 of the Companies Act. In the light of above, he submits that the impugned notice is per se, without jurisdiction and illegal as notice cannot be served on an entity which is knowingly non-existent by the revenue. 4. We clarify that the petitioner would be at liberty to raise any other issue including the issue of jurisdiction before the learned Assessing Officer, further we grant liberty in favour of petitioner to approach the Court in accordance with law, if need so arise in future, by way of filing fresh writ petition. (4 of 4) [CW-6883/2022] 5. In the light of above, writ petition is disposed of. 6. Consequent upon the disposal of the writ petition, the stay application filed therewith does not survive and the same also stands disposed of accordingly. (SAMEER JAIN),J (PRAKASH GUPTA),J KuD/MR/11 "