SWARAN FINANCIAL PVT LTD. V. UNION OF INDIA AND ORS

WPO/580/2022

AI Insights

The case involves multiple writ petitions filed by Nusarwar Merchants Pvt Ltd and others against the Union of India, challenging the validity of notices issued under Section 148 of the Income Tax Act, 1961. The petitioners argued that these notices were barred by limitation and did not comply with the statutory formalities introduced by the Finance Act, 2021, effective from 1st April 2021. The court considered similar precedents from other High Courts and found that the notices issued beyond the stipulated date were indeed invalid. The court's decision was influenced by the need to adhere to the statutory changes brought by the Finance Act, 2021, which were not observed in the issuance of the impugned notices.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 721505 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 02-02-2022
• Assessment Year: misc
• Other Referred Cases: Ashok Kumar Agarwal \/ Union of India through its Revenue Secretary North Block & Ors., Bpip Infra Private Limited\/ Income Tax Officer, Ward 4 (1), Jaipur, Man Mohan Kohli\/ Assistant Commissioner of Income Tax & Anr., Manoj Jain\/ Union of India & Ors., Bagaria Properties and Investment Private Limited & Anr.
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021, Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: TILAK MITRA
• Assessee Lawyers: SUBASH AGARWAL; BRIJESH SINGH
• Keywords: Income Tax; Limitation; Re-assessment; Ultra Vires; Writ petition
• Section: 148; 148-A

Judgement Text

"1 IN THE HIGH COURT AT CALCUTTA Constitutional Writ Jurisdiction Original Side Present :- Hon’ble Mr. Justice Md. Nizamuddin W.P.O. No. 432 of 2022 NUSARWAR MERCHANTS PVT LTD. Vs. UNION OF INDIA AND ORS. With W.P.O. No. 433 of 2022, W.P.O. No. 435 of 2022, W.P.O. No. 436 of 2022, W.P.O. No. 437 of 2022, W.P.O. No. 438 of 2022, W.P.O. No. 439 of 2022, W.P.O. No. 440 of 2022, W.P.O. No. 441 of 2022, W.P.O. No. 442 of 2022, W.P.O. No. 443 of 2022, W.P.O. No. 444 of 2022, W.P.O. No. 533 of 2022, W.P.O. No. 534 of 2022, W.P.O. No. 535 of 2022, W.P.O. No. 536 of 2022, W.P.O. No. 537 of 2022, W.P.O. No. 559 of 2022, W.P.O. No. 560 of 2022, W.P.O. No. 561 of 2022, W.P.O. No. 562 of 2022, W.P.O. No. 564 of 2022, W.P.O. No. 565 of 2022, W.P.O. No. 566 of 2022, W.P.O. No. 569 of 2022, W.P.O. No. 570 of 2022, W.P.O. No. 577 of 2022, W.P.O. No. 578 of 2022, W.P.O. No. 579 of 2022, W.P.O. No. 580 of 2022, W.P.O. No. 581 of 2022, W.P.O. No. 582 of 2022, W.P.O. No. 583 of 2022, W.P.O. No. 584 of 2022, W.P.O. No. 585 of 2022, W.P.O. No. 587 of 2022, W.P.O. No. 588 of 2022, W.P.O. No. 589 of 2022, W.P.O. No. 590 of 2022, W.P.O. No. 591 of 2022, W.P.O. No. 593 of 2022. For the Petitioners :- Mr. Subash Agarwal, Mr. Brijesh Kumar Singh, Mr. Pijush Kanti Ray, Mr. Prashant Agarwal, Mr. C. Chatterjee, Mr. Abhratrosh Majumder, Ms. Sapna Das, Mr. Siddharth Das, Mr. Pradeep Jewrajka, Ms. Pooja Jewrajka, Ms. Jyoti Rauth, Mr. Pratyush Jhunjhunwala, Mr. Samit Rudra, Mr. P. K. Jhunjhunwala, Mr. Zubeen Pandey, Mr. Gopal Ram Sharma, Mr. Gobinda Dey, Mr. Anil Kumar Dugar, Mr. Rajarshi Chatterjee, Advocates For the Respondents :- Mr. Tilak Mitra, Mr. S. Kr. Chatterjee, Mr. Surajit Roychowdhury, Mr. Soumen Bhattacharjee, Advocates 2 Dated : 2nd February, 2022 MD. NIZAMUDDIN, J. Heard Learned Counsels appearing for the parties. In view of involvement of common question of law and similarity of facts in all these Writ Petitions, with the consent of the parties all these Writ Petitions have been heard together and are being decided by the present common judgement and order. Common facts and issues involved in all these Writ Petitions as appear on perusal of relevant record and upon considering the submissions of the parties are that the petitioners are aggrieved by the issuance of impugned notices under Section 148 of the Income Tax Act, 1961 on the ground that the same are barred by limitation and the respondent Income Tax Authority concerned, before issuing the impugned notices under Section 148 of the Income Tax Act, have not observed the statutory formalities under Section 148 A of the Income Tax Act as prescribed by the Finance Act, 2021 which are applicable with effect from 1st April, 2021 before issuance of notices under Section 148 of the Act on or after 1st April, 2021. Issues arising in all the present Writ Petitions are purely legal and in all these Writ Petitions the assessees/petitioners have sought relief of quashing of the impugned re-assessment notices issued post 31st March, 2021 by the respondent Income Tax Authority concerned under Section 148 of the Income Tax Act, assessees/petitioners have also sought relief by way of a declaration declaring Explanations A(a)(ii)/A(b) to the Notification No. 20 [S.O. 1432 (E) dated 31st March, 2021 and Notification No. 38 [S.O.1703 (E)] 3 dated 27th April, 2021 to the extent that the same extend the applicability of the “provisions of Section 148, Section 149 and Section 151 of the Act, as the case may be, as they stood as on the 31st March, 2021, before the commencement of the Finance Act, 2021” to the period beyond 31st March, 2021 as ultra vires the parent legislation, viz., The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (hereinafter referred to as ‘ Relaxation Act, 2020’). At the outset, all the counsels appearing for the parties jointly submitted that the issues involved in these Writ Petitions are covered by the decision of the Division Bench of the Allahabad High Court dated 30th September, 2021 in the case of ‘Ashok Kumar Agarwal –vs- Union of India through its Revenue Secretary North Block & Ors.’ (Writ Tax No. 524/2021) decided in favour of assessees/petitioners on 30.09.2021 and order of Rajasthan High Court dated 25th November, 2021 in the case of Bpip Infra Private Limited-vs.- Income Tax Officer, Ward 4 (1), Jaipur (S.B. Civil Writ Petition No. 13297/2021) and the order of Delhi High Court 15th December, 2021 in the case of Man Mohan Kohli –vs- Assistant Commissioner of Income Tax & Anr. In (W.P. (C) 6176 of 2021) and judgement and order of this Court dated 17th January, 2022 in the case of Manoj Jain Vs. Union of India & Ors. In WPA No. 11950 of 2021 and in the case of Bagaria Properites and Investment Private Limited & Anr. In WPO 244 of 2021. In view of judgement and order of this Court dated 17th January, 2022 in the case of Manoj Jain Vs. Union of India & Ors. In WPA No. 11950 of 2021 and in the case of Bagaria Properties and Investment Private Limited & 4 Anr. in WPO No. 244 of 2021, all these Writ Petitions herein are disposed of by allowing the same. Explanations A(a)(ii)/A(b) to the Notifications dated 31st March, 2021 and 27th April, 2021 are declared to be ultra vires the Relaxation Act, 2020 and are therefore bad in law and null and void. All the impugned notices under Section 148 of the Income Tax Act are quashed with liberty to the Assessing Officers concerned to initiate fresh re- assessment proceedings in accordance with the relevant provisions of the Act as amended by Finance Act, 2021 and after making compliance of the formalities as required by the law. Urgent certified photocopy of this order, if applied for, be supplied to the parties upon compliance with all requisite formalities. (Md. Nizamuddin, J.) Sbghosh "