NAVEEN BELIDE V. Office of the Assistant Commissioner of Income Tax

WP/10560/2024

AI Insights

The case involves a writ petition filed by Naveen Belide challenging the reassessment notice issued by the Income Tax Department for the assessment year 2015-16. The petitioner argued that the notice under Section 148 of the Income Tax Act, 1961, was invalid due to non-compliance with the modified assessment procedures introduced by the Finance Act, 2021. The respondents included various authorities from the Income Tax Department and the Union of India. The court referenced a previous common order in W.P.No.25903 of 2022, which had set a precedent on similar grounds, leading to the decision to quash the notices and orders in this case.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 752988 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 23-04-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021, Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: J V PRASAD; B MUKHERJEE
• Assessee Lawyers: THANNERU KUMAR
• Keywords: Assessment Year 2015-16; Faceless assessment; Income Tax; Jurisdictional issue; Procedural Flaw; Writ of Mandamus
• Section: 148; 265; 226; 144(8); 14G

Judgement Text

"HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) TUESDAY ,THE TWENTY THIRD DAY OF APRIL TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE N.TUKARAMJI WRIT PETITION NO: 10560 OF 2024 [ 3403 ] 57 years, Hyderabad, ...PETITIONER the. Government, 10 001. Between: NAVEEN BELIDE, S/o. Kameshwar Rao Belide, aged about O.Cro\"tion. Business, R/o. Enclave Raj Bhavan Road, UvJ\"irU\"O 500082, Teiangana, lndia Assessment Year' 2015-16 AN D 1 2 n office of the Assistant commissioner of lncome Tax, Circle 9(1), Hyderabad, Telanoana State. fi;'F;;;p;l dhief commissioner of lncome Tax - Telangana 919 4:l' ivi.iidiollrtiJveers, AC Guarcls, Masab Tank, Hvderabad - 500 028' Telanoana. i6\" Ctiirrr Board of Direct Taxes, Represented by its Chairman, Department ;i'R\"*;r;, Ministry ot Finance, Gov6rnment of thdia, Secretariat Buildings, New Delhi - 1'10 001 . ine 51riionar Faceless Assessment center, lncome Tax Department, New Delhi. ihe Union of lndia, Represented by its Secrefary. to. Department of Revenue, tr/inistry of Finance, New Delhi - 1 4 5 ...RESPONDENTS Petition under Article 226 of lhe constitution of lndia praying that in the , circumstances stated ' in the affidavit filed therewith, the High Court may be 1i rpleased to issue an appropriate writ, order or direction more particularly one in li the nature of Writ of Mandamus declaring the order passed by the lncome Tax lAuthorities (National Faceless E-Assessment Centre completed the assessment uts 147 r/w Section 144-8 of the lncome Tax Act, 1961 vide DIN and Notice No. id\",\"o t o-os-2024 trdA/AS r Et 1 47 t2o23'241 1062592857 (1) tor the assessment :. ,l| iyear 2o15-l6deterrnining the total income of RS. 92,43,1 121- as arbitary, illegal' ll bad in law, without jurisdiction, void-ab-initio, violative of the princlples of natural .i tl ,iustice apart trom Deing violative of Articles 14. 19(1)(g) and 265 of the l' i.i Constitutron of India and Sec. 14gA of the lncome Tax Act. 196.1 , and consequently set aside the sarne in tie interests of justice I Counset for the petitioner: SRt. THANNERU CHAITANYA KUMAR Counsel for the Respondent Nos. 1&2: SRI J. V. PRASAD (sc FoR TNCOME TAX) Counsel for the Respondent Nos.3to5: SRI B. MUKHERJEE REp SRI GADI.PRAVEEN KUMAR, DY. SOLICITOR GENERAL OF INDIA The Court made the following: ORDER i I I I I I I I I I I I r-ltil.f ( ! I I I THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE N. TUI(ARAMJI WRIT PETITION No.1O56O OF 2024 ORDER: (per Hon'bte sP,J) Heard Sri Thanneru Chaitanya Kumar, learned counsel for the petitioner; Sri J.V.Prasad, learned Standing Counsel for Income Tax Department for respondent Nos. 1 and 2 and Sri B- Mukherjee, learned counsel representing Sri Gadi Praveen Kumar, learned Deputy Solicitor General of India for respondent Nos.3 to 5. 2. The ground taken by the learned counsel for the petitioner is that in furtherance of Finance Act, 2021, te' assessment Process stood modified but the respondents have not taken care of it and therefore notice issued under Section 148 of the Income Tax Act, 196 1 cannot sustain judicial scrutiny' Since notice is bad in law, the consequential orders are also bad in 1aw. 3. During the course of hearing, learned counsel for the parties agreed that curtains on this issue are linally drawn by this Court in a batch of writ petitions, W.P.No'259O3 of 2022 and other connected matters, decided by common order dated 2 14.O9.2023. The parties agreed that this matter may be disposed o[ in terms of the Common Order dated 14.O9.2023. 4 This Court in the said order dated 14.09.2023 in W.P.No.25903 of 2022, held as under: \"35. ln view of the aforesaid discussions, it is by now very clear that the procedure to be followed by the respondent-Department upon treating the notices issued for reassessment being under Section 148A, the subsequent proceedings was mandatorily required to be undertaken under the substituted provisions as laid down under the Finance Act, 2021. ln the absence of which, we are constrained to hold that the procedure adopted by lhe respondent-Department is in contravention to the slatute i.e. the Finance Act,2021, at the first instance. Secondly, it is also in direct contravention to the directives issued by the Hon,ble Supreme Court in the case of Ashish Agarwal, supra. 36. For all the aforesaid reasons, the impugned notices issued and the proceedings drawn by the respondent-Departmenl is neither tenable, nor sustainable. The notices so issued and the procedure adopled being per se illegal, deserves to be and are accordingly set aside/quashed. As a consequence, all the impugned orders getting quashed, the consequential orders passed by the respondent Department pursuant to the notices issued under Section 147 and 148 would also get quashed and it is ordered accordangly. The reason we are quashing the consequenlial order is on the principles that when the initiation of the proceedings itself was procedurally wrong, the subsequent orders also gets nullified automatically. 37. The preliminary objection raised by the petitioner is sustained and all these writ petitions stands allowed on this very iurisdictaonal issue. Since the impugned notices and orders are getting quashed on the point of iurisdiction, we are not inclined to proceed further and decide the other issues raised by the petitioner which stands reserved to be raised and contended in an appropriate proceedings. 38. Since the Hon'ble Supreme Court had, in the case of Ashish Agarwal, supra, as a one-time measure exercising the powers under Article 142 of the Constilution of lndia, permitted the Revenue to proceed under the substituted provisions, and this Court allowing the petitions only on the procedural flaw, the right conferred on the Revenue would remain 3 reserved to proceed further if they so want from the stage of the order of the Supreme Court in the case of Ashish Agarwal' suPra' 5. In view of the consensus arrived' the impugned Show Cause notice and consequential orders passed in this writ petition are 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'Og'2023 in W.P.No'25903 of 2022' 6 The writ Petition allowed. No costs' Interlocutory 39 No order as to costs'\" BM GJP 1S apPlicattons, if anY pending, sha-ll also stand closed ASSISTANT RE I'TRUE COPYI/ SD .MOHD. ISMAIL ISTRAR SECTTON O FTCER I Ilr t, I I I I Ii, t I I I I i I t I I I To, ; ii;:,,hi1;,;3ffi';ffi* '111fli# ffi;r'ii* 'ffx'rlllttl,\":\"Tsi;fl sJ:'''ffi '::Iti*::',:l'ffi l*\"^t'\"* lffifig***m**t**t;**ss^::' I I I t I I I t 1 I I $\"- HIGH COURT DATED:2310412024 r WP.No.10560 of 2024 ]i ALLOWING THE WRITPETITION . WITHOUT COSTS lttE sIA 14. o o t r I ;Uh Zfl{ * oFspeTC ( ) J ( )' 2 a ORDER ? t HftO * I i ! i I I I I I I I i I I I I ! 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