Gardenia Ventures V. Income Tax Officer

WP/228/2025

AI Insights

The case involves a writ petition filed by a partnership firm challenging the rejection of their stay application by the Income Tax Officer, Ward 8(1), Hyderabad. The rejection was based on administrative circulars from the CBDT dated 29-02-2016 and 31-07-2017. The petitioner argued that the Income Tax Officer, as a quasi-judicial authority, should not be bound by these circulars and must apply its independent mind, referencing decisions from the Supreme Court and other High Courts. The court agreed with the petitioner's argument and set aside the rejection order, reviving the stay application and directing a fresh decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 690126 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 09-01-2025
• Assessment Year: misc
• Other Referred Cases: Principal Commissioner of Income Tax 5 & ors. v. M/s.LG Electronics India Pvt.Ltd., APR Jewellers Private Limited v. The Commissioner of Income Tax (Appeals), Hyderabad-I, M/s.Zoos and Parks Authority of Telangana v. the Commissioner of Income Tax
• Laws Referred To: Article 226 of the Constitution of India, Section 151 CPC
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: P KRISHNA
• Assessee Lawyers: M DEEPAK
• Keywords: Arbitrary; Illegal; Quasi-judicial authority; Stay Application; Violative of Article 14; Writ of Mandamus
• Section: 151; 226

Judgement Text

"[ 3430 ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Speciat Original Jurisdiction) THURSDAY, THE NINTH DAY OF JANUARY TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE DR. JUSTICE G.RADHA RANI WRIT PETITION NO:22I OF 2025 Between: P:I!^\"l,lY:llyr\"jl l.,p\"ll\"rship firm.Hav-ins its office at 77 Marisotd, L and r berene uounty, cachibowri, Hyderabad- 500032 Represented by ii-s partner tvtr Gaddam Ramakrishna Reddy.'S/o. Sri. caddjm Bhlma Reddyl Agui ;6o;t bS years, Rl/o. Hyderabad. AND .....PET|TIONER 1. lncome Tax Officer, Ward 8(1), Hyderabad. 2. The National Faceless Appe.al Centre, Room No. 4O1 ,2ndFloor, E-Ramp, Jawaharlal Nehru Stadiuiri, Delhi - 1 .lO 003. 3. National Faceless Assessment centre, rncome{ax Department, New Derhi, lndia 4. Axis Bank Limited, 7th Froor, c-2, wadia rnternationarcentre, Axis Bank Limited, Axis house, pandurang Budhkar Marg, Worii, fr4r\"iOii_+OoOZ5,' Maharashtra. .....RESPONDENTS Petition Under Article 226 of rhe constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to issue a writ, direc{ion or order more particularly in the nature of a writ of mandamus decraring the proceedings dated 17-12-2024 bearing DrN |rBA/RCV/F/1 712o24'2srio712|73s6<1) issued by the Respondent No. 1 rejecting the application of the petitioner for grant of stay and direc{ing the Petitioner to pay 20percent of the disputed tax riabirity as being arbitrary, iilegar, violative of Article 14 of the Constitution of lndia and without any application of mind and consequently set aside the same. |.A.NO:1 OF 2025 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 stay the operation of the Notice u/s 226(3) dated 27-12-2024 bearing DIN ITBA/COM/F/1712024- 2511071604612(1) issued by the Respondent No. 1 to Respondent No.3. |.A.NO:2 OF 2025 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 stay the collection of tax pursuant to the assessment order dated 19-03-2024 bearing Dri.,T No. ITBA/AST/S/143(3)12023- 2411062947333(1) read with the rectification order dated 27-11-2024 bearing DIN ITBA/REClsl9112024-2511070828474(1) and also the penalty order dated 06-09-2024 bearing TDlN ITBA/PNLIF1270A12024- 2511068427329(1) pending disposal of the above writ petition. . Counsel for the Petitioner : SRI M.NAGA DEEPAK Counsel for the Respondent Nos.1 to 3 : SRI P.MURALI KRISHNA, SENIOR STANDING COUNSEL FOR Ms.J.SUNITHA (JUNIOR SC FOR INCOME TAX) Counsel for the Respondent No.4 : -- The Court made the following ORDER WRIT PETITION No.228 OF 2o25 ORDER: (per Hon'ble Sri Justice Sujog Paul) Sri M.Naga Deepak, learned counsel for the petitioner and Sri P.Murali Krishna, learned Senior Standing Counsel appears for Ms.J.Sunitha, learned Junior Standing Counsel for Income Tax Department, for respondent No. I to 3. 2. With the consent hnally heard 3. The challenge is mounted to the order dated 17.12.2024 (Annexure P10), whereby the petitioner's stay application has been rejected by respondent No. 1. 1 kq;Ired counsel for the petitioner submits that the rejection order shows that it is solely based on CBDT OMs dated 29.02.2016 and 31.07.2017. The Apex Court had an occasion to consider this aspect in Principal Commissioner of Income Tax 5 & ors. v. M/s.LG Electronics India Pvt.Ltd.,r and this Court in APR Jewellers Private Limited v. The Commissioner of lncome Tax (Appeals), Ilyderabad-I and anothere and Ml s.Zoos and Parks Authority of Telangana v. the Commissioner of lncome Tax I , ) t ' zota 1z; rrrat l9o5 - sc order ' zozz 1s1tut todl 7 -a , I THE HONOURABLE SRT JUSTICE SUJOY PAUL AND THE HONOURABLE DR. JUSTICE G.RADHA RANI l, I 2 Exemptions and another3. It is submitted that the courts opined that respondent No.l being a quasi judicial authority should apply its independent mind and shan not be bound by the administrative circulars. Thus, it is prayed that the said rejection order dated 17.12.2024 may be set aside and respondent No. I may be directed to debide the stay application afresh within the stipulated time. The other side has no objection to this innocuous prayer. 6. Accordingly, the impugrred order dated 17.12.2024 is set aside. Resultantly, the stay application is revived. The petitioner shall appear before the appellate authority on l3.Ol.2O2S. The appellate authority shall decide the stay application afresh, in accordance with law, within 15 days therefrom. 7 . The Writ Petition is disposed of, without expressing any opinion on the merits of the case. No order as to costs. Miscellaneous etitions pending, if any, shall stand closed 32023 (10) TMI 1139 SD/- K. AMMAJI //TRUE COPYII ASSI IANT REGIS TRAR To SECTION OFFICER 5 1. The lncome Tax Officer, Ward B(1 ), Hyderabad. 2. The National Faceless nppe_at Cbriire, noom No. 401 ,2nd Floor, E-Ramp, ^ Jawahartal Nehru Stadiuiri, Delhi - f fo OOi. '- ' 3. The National Faceless Assessment C;tr.\", lncome_tax Department, New Delhi, lndia. 1. 9n\" CC to SRt M.NAGA pEEpAK, Advocate tOpUCl 5. One CC to Ms. J.suNrrHA (JUNTOR SCF.R'rrrrc-orire rAX) Advocate IOPUCI 6 SA GJP Two CD Copi S HIGH COURT DATED:0910112025 ORDER WP.No.228 of 2025 DISPOSING OF THE W.P WITHOUT COSTS. ) 7 5 Ftn 2[25 TA r4' s E h o 0 * I "