MR MAHAVEER CHAND JAIN V. INCOME TAX OFFICER

WP/23916/2021

AI Insights

The case involves Mr. Mahaveer Chand Jain, the petitioner, who challenged the validity of notices issued by the Income Tax Department under Section 148 of the Income Tax Act, 1961, for the Assessment year 2016-17. The notices were based on notifications issued by the Central Board of Direct Taxes (CBDT) which the petitioner argued were contrary to the provisions of the Income Tax Act, 1961, and the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. The High Court of Karnataka, referencing several precedents, found the notifications and the subsequent notices to be ultra vires and thus invalid.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 695607 (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; DILIP M
• Assessee Lawyers: SANTHOSH G
• Keywords: Income Tax Act; Quashment of notice; Re-assessment proceedings; Taxation and Other Laws; Ultra Vires
• Section: 147; 148; 148A

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.23916 OF 2021 (T-IT) BETWEEN: MR. MAHAVEER CHAND JAIN S/O CHAMPALAL JAIN AGED ABOUT 31 YEARS RESIDING AT NO.5, BAZAR ROAD VIJAYAPURA, BENGALURU 560035. ... PETITIONER (BY MR. SANTHOSH KUMAR G, ADV.,) AND: 1. INCOME TAX OFFICER WARD 6(3) (1) BANGALORE BMTC BUILDING 80 FEET ROAD, 6TH BLOCK NEAR KHB GAMES VILLAGE KORAMANGALA, BENGALURU-560095. 2. PRINCIPAL COMMISSIONER OF INCOME TAX-6 BANGALORE BMTC BUILDING 80 FEET ROAD, 6TH BLOCK NEAR KHB GAMES VILLAGE BENGALURU-560095. 3. CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE MINISTRY OF FINANCE 2 UNION OF INDIA NORTH BLOCK NEW DELHI-110002 REPRESENTED HEREIN BY ITS CHAIRPERSON. ... RESPONDENTS (BY MR. K.V. ARAVIND A/W MR. DILIP M, ADVS.,) - - - THIS W.P. IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE IMPUGNED NOTICE DTD.26.06.2021 ISSUED UNDER SECTION 148 OF THE INCOME TAX ACT 1961 BY THE R-1 WHEREBY THE R-1 IS SEEKING TO INITIATE RE-ASSESSMENT PROCEEDINGS UNDER SECTION 147 OF THE ACT 1961 FOR THE ASSESSMENT YEAR 2017-18 AND ALLOW THE SAID RELIEF AND RENDER JUSTICE ANNEXURE-A. DECLARE THAT IN THE EVENT IT IS BEING HELD THAT THE IMPUGNED NOTIFICATION DTD.31.3.2021 AND 27.4.2021 RESPECTIVELY ANNEXURE-D AND D1 ISSUED BY THE R-3 ENABLE THE RESPONDENTS AND THE REVENUE AUTHORITIES TO DISPENSE WITH THE REQUIREMENT TO COMPLY WITH THE CONDITIONS PRECEDENT THAT ARE SET OUT IN SECTION 148A OF THE INCOME TAX ACT 1961 BEFORE ISSUING ANY NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT 1961 THE SAID NOTIFICATIONS ARE CONTRARY TO 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 AND THUS BAD IN LAW & 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 quashment of explanation below Clause (A) in the notification bearing No.20/2021 3 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 20.06.2021 issued under Section 148 of the 1961 Act for the Assessment year 2016-17. 2. We have heard the learned counsel at length. For the reasons assigned by us in the judgment dated 19.04.2022 passed in 4 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.20/2021370142/35/2020-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 is hereby declared as ultra vires the provisions of Income Tax Act, 1961 and the 5 provisions of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. The impugned notice dated 20.06.2021 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 "