Polraj 5000 V. Assessment Unit, Income Tax Department, National e-Assessment Center and Income Tax Officer, Ward 9(1) and Principal Chief Commissioner of Income Tax, Andhra Pradesh

WP/24820/2024

AI Insights

The case involves a writ petition filed by Polraj challenging the notices and orders issued by the Income Tax Department under various sections of the Income Tax Act, 1961, for the assessment year 2018-19. The petitioner argued that the notices were issued without jurisdiction and contrary to the faceless assessment procedure as laid down in Section 148A of the Income Tax Act, 1961. The respondents included various officials from the Income Tax Department. The court's decision was influenced by a previous ruling in W.P. No. 25903 of 2022, which addressed similar procedural issues under the Finance Act, 2021.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 798570 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 10-09-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal vs. Revenue
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021, Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: B REDDY
• Assessee Lawyers: S ADITHYA
• Keywords: Faceless assessment; Income Tax; Jurisdiction; Notice Quashing; Reassessment; Writ of Mandamus
• Section: 147; 148; 144; 270A; 144B; 148A; 272A(1)(d); 226

Judgement Text

"IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE TENTH DAY OF SEPTEMBER - rWO THOUSAND AND TWEN-r-Y FOUR [ 3411 I ...PETITIONER THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTIC.E NAMAVARAPU RAJESHWAR RAO PRESENT WRIT PETI TION NO:2 4820 oF 2024 Between: Polraj 500 0 AND 1 Pallaou.PlotNo.T25,NandhiHills,Meerpet,SaroorNagar'Hyderabad- 38 (PAN CAUPP06T lc) 2 J Assessment Unit, lncome Tax Department, National e-Assessment Center' Room No.401, 2nd Floor, Eri;;l;;;niiriiNer\"u Stadium' New Delhi-1 1 0 003. lncome Tax Officer, Ward 9(1), 2nd Floor, D-Block' lT Towers' 10-2-3' AC Guards, HYderabad-500 028. Princioal Chief Commissioner of lncome Tax' 4'1Qlttg Pradesh and i;i;;E;;;.'ii;j.,il6,J*io:) 5: R;' N\" e'2' e'h Froor' 'B' Brock' rr rowers' AC Gfards, Hyderabad-500 004' ...RESPONDENTS Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated an tfre aitiOavit filed therewith' the High Court may be ;1\";;; 1; \".ue a Writ oi-H4indamrs or any other appropriate writ, order or ;;;.; (a) declaring tne noiice Lsued bv the 2nd Respondent'19:l-!^\"9tlon 148A(b) dated 30.03.20d' U\"'i'g DIN' ITBA/AST/F/148A(SCN t2021-221 1042023702(1) and order passeO UV\" 2!q 59:q9^,9tnt under Section 14BA(d) dated 26.4.2022, bearing brr.r.-rranlnsrEtliSAt2o22-2311042863458('1) and notice under Section t+g J tne lncome Tax Act' 1961' daled 26'04 2022 ' ;;;g-DiN. riaAAsrlsi iqa-11ozz-zt/ 1042863583(1)' for the assessment vear 2018_1g as witnoui jrrisoiction and contrary to faceless assessment il#J.],\"\";; io*n'r's\"\"iion '148A of the lncome Tax Act 1961 (b) dectarins the order passed by tne Ginespondent' und.e^r-section 147 r/w Section 144 read with Section 1448 oIin\" into*\" Tax Act' 1961' dated 2T'022024' bearing DtN.ITBAJAST tst147t2o2i-;4lioorooszzsir), for the assessment vear 2018-19 as without Jurisdiction anJ contrary to faceless assessment procedure laid down , sL\"ti* 148A of tne rncome rai n\"t tgot and (c) set-aside the penalty order ' I ,,under section 272A(1)(d) bearing DtN. trRA/pNL/F/ 272A(1)(d)12024- 2511067658657(1)dated,.1,4.8.2024andunderSection270AbearingDlN ITBA/PNL/F/27'iAnOi3-ZStto679S1966(1) dated 26 8 2024 . a.s wilhout Jurisdiction, arbitrary, illegal, bad in law, void-ab-initio, apart from being violative of Articles ia, rgtrl(gl aios or the constitution of lndia and contrary to section 14gA of the lncome'lax Act, 1g61 and consequently set-aside the same in the interests of justice lA NO: 1 OF 2024 PetitionunderSectionl5lCPCprayingthatintheCircumstancesstated in the affidavit filed in support of the petition, the High Court may be pleased to \"t\"V ,ff further proceedings, including any re^covery, pursuant to the impugned oiOlr issueO by the 1st Respondent,-under Secticn 147 read with Section 144 read with sectibn 1448 oI the lncome Tax Act, 1961, dated 27 02.2024, bearing DIN.ITBA/ASTtst147t2o23-24t1061605723(1)fortheassessmentyear20lB.l9 and the penalty order under Section 272A(1Nd) bearing DIN -ITBA/PNL/F/ iizxll6i4tZOZi_ZUrcArcSAA57(1) dated 14.82024 and under Section 270A nearing\" DIN ITBA/PNL/F/27ON|O24' 2511067981966(1) dated 2682024' p\"rairg disposal of the Writ Petition as otherwise the Petitioner will be put to severe loss and hardshiP. Counsel for the Petitioner: SRI S. VIJAY ADITHYA counsel forthe Respondents: Ms. B. SAPNA REDDY (Jr. SC FOR INCOME TAX) The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION No.2482ooF 2024 ORDER: (per Hon'ble Justice Sujog Poul) Heard Sri S. Vrjay Adithya, learned counsel for the petitioner(s) and Ms. B' Sapna Reddy' learned Junior Standing Counsel for Income Tax Department' for the respondents. 2. The ground taken by tl're learned counsel for the petitioner(s) is that in furtherance of Finance Act' 2O2I' re- 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, 1961 ca-nnot sustain judicial scrutiny. Since notice is bad in law' the consequential orders are also bad in law. 3. During the course of hearing' learned counsel for the parties agreed that curtains on this issue are finally drawn by this Court in a batch of writ petitions' W'P'No'25903 of 2022 andotherconnectedmatters,decidedbycommonorder dated 14.09. 2023. Tne parties agreed that this matter may be disposed of in terms of the Common Order dated 14 'O9 '2023 ' 2 -rr- 4. This Court in the said order dated 14.09.2023 rn W.P.No.259O3 ol 2022, held as under: '35. In view of the aforesaid discussionb, it is by now very clear that the procedure to be followed by the respondent- Depart6ent upon treating the ltoticcs issued for reassessment being under Section 148A, the subsequent proceedings was mandatorily requfued to be undertaken under the substituted provisions as laid dolrn under the Finarce Act, 2021. In the abseace of rrhich, we are constraitred to hold that the procedure adopted by the respoadettt-DepartrEeut is in coatraventior to the statute i.e. the FiDance Act,2O21, at the first lnstance. Secoadly, lt ls also ia direct contravention to the directives issued by the Hou'ble Supreme Court in the case of Ashish Agarwal, supra. 36. For all the aforesaid reasons, the impugaed lotices issued and the proceedirgs drawn by the respotrdent-Department is neither tenable, nor sustainable. The notices so issued and the procedure adopted beitrg per se illegal, deserves to be aud are accordingly set aslde/quashed. As a coasequeEce, all the iEpugned orders gettiBg quashed, the coosequential orders passed by the respondelt DepartEe[t pursuant to the notices issued under Section 147 and 148 would also get quashed and it is ordered accordingly. The reason rre are quashing the coasequetrtial o.de. is oa the principles that when the initiation of the proceedings itself was procedurally wrong, the subsequent orders also gets nullilied autotlatically. 37. The prelimlnary objection raised by the petitioner is sustaiDed a[d all these writ petitions statrds alloqred on this very jurisdictioral iasue. Siace the iepuglred notices ald orders ar€ getting quashed on the point ofJurisdiction, we are not inclined to proceed further atrd decide the other issues raised by the petitioncr which staads teaerved to be raised arld cotrtended in an appropriate pioceedings. 38. Sirce the Hoa'ble Supreme Court had, iu the case of Ashish Agarwal, supra, as a o[e-time ueasure exercising the powers under Article 142 of the Constltution of tndia, permltted the Revenue to proceed under the substituted provisiors, and this Court aUosirg the petltions only on the procedutal [latl,, the rlght confer.ed o! the Revenue would remain reserved to ptoceed further if they so want from the stage of the order of the Supreme Court in the case of Ashish Agarwal, suPra- 39. No order as to costs'' 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 pa-ragraph No.38 of the order dated 14'09'2023 in W.P.No.259O3 of 2022. 6. The Writ Petition is allowed' No costs' Interlocutory applications, if any pending, shal1 also stand closed' SD/. K,SREERAMA MURTHY ASSISTANT REGISTRAR //TRUE COPY// SE ION OFFICER To, 1. Assessment Unit, lncome Tax Department National e-Assessment Center' Room No 401, zno rtooi Efr;till;;;h;;;l irlehiu stadium New Delhi-110 , ,o\"Xlr. Tax Officer, Ward 9(1), 2nd Floor' D-Block' lT Towers' 10-2-3' AC - Guards, HYderabad-500 028 3. Principal Chief Commrssii-n\"\"' ot lncome T-ax' A^ndhra Pradesh and retanoana. Hvderabad i'dlib. ir\"Jii'tl\" s)2' stl'' Floor' lV Block' lT Towers' nC Giards, HYderabad-S0O 004 4 a;\"ac'i. snlb. Vrinv AblrHYA, Advocatg-Lqigc' 5 one cc to Ms B. sAPNf,iliDiji'ti; s\"CFoi-ttlcott'tE rAX) toPUCl 6. Two CD CoPies BN GJP 3 l I i I HIGH COURT DATED: 1 0 10912024 ORDER WP.No.24820 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS oR THE Si{ o o 0 B JAit zozs z 6 ( : (, * l I gq4 W "