Sri. SimranSamarjeet Singh Chhabra V. Assistant Commissioner of Income Tax,

WP/15353/2024

AI Insights

The case involves a writ petition filed by Samarjeet Singh Chaabra against the Assistant Commissioner of Income Tax and other respondents, challenging the legality of notices and orders issued for the assessment year 2015-16. The petitioner argued that the reassessment process followed by the respondents did not comply with the modified procedures established by the Finance Act, 2021, and thus the notices under Section 148 and subsequent orders were void and contrary to the principles of natural justice. The court referenced a previous common order in a batch of writ petitions, which had set a precedent on the procedural requirements that must be followed by the Income Tax Department in such cases.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 752892 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 20-06-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021, Article 226 of the Constitution of India, Section 151 CPC
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: J PRASAD
• Assessee Lawyers: VENKAT RAM MANTUR
• Keywords: Income Tax; Natural Justice; Procedural Flaw; Reassessment; Writ of Mandamus
• Section: 147; 148; 144; 144B; 148A(d); 156

Judgement Text

"134111 HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE TWENTIETH DAY CF JUNE TWO THOUSAND AND TWENTY FOUR PRESENT THE HON'BLE SRI JUSTICE SUJOY PAUL AND THE HON'BLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION NO: 15353 OF 2024 Between: AND 1. ') J. Sri simran Samarjeet-SinghCH:il/\" Samarjeet Singh Chaabra, Aged about 32 years, Occ.Business, Flat No.102 Tulip-Tower Apartments, R5ad No.6,lncome Tax Colony Alkapuri, R.K.Puiam, Hyderabad 500035, Telangana' lndia. PAN No AuLPCo,l4F ...pErrroNER Assistant Commrssioner of lncome Tax,, Ward 15 ('1), Hyderabad, lncome Tax Towers, AC Guards, Masab Tank, Hyderabad-500004 Principal Chief Commissioner of lncome Tax lncome Tax Towers,, AC Guards Masab Tank. Hyderabad-500004. The Assessment Unit, lncome Tax Department National Faceless Assessment Centre Room No 401, 2nd Fioor ERamp Jawaharlal Nehru stadium Delhi 1 '10003 ..RE.'.NDENTS Petition under Article 226 ol lhe Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a wrrt, order or direction, more particulai-ly one in the nature of Writ of Mandamus, declaring the impugned Order dt.06.03.2024passed uts 147 R/w Section 144, read with section 1448 of the lncome Tax Act vide DIN No. ITBA/AST/S/14712023-24/1060208061(1)and also issued Notice of demand under section 156 of the lncome-Tax Act, 196 1, dated 06.03 2024, vide DIN and Notice No. ITBA/AST|S|| 5612023- 2411062093295(1) by the 3rd respondent for A.Y. 2015-16, pursuant to the order u/s 148A(d)dt.07 .04.2021'and notice issued u/s 148 d1.07.04.2022by the IVIO instead of FAO,as void, illegal, and contrary to the Provisions of lncome-tax Act and contrary to the Principles of Natural Justice lA NO: 1 AF 2A24 Petition under Sect;cn 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 all the further proceedings initiated by the 3rdRespondent against the Petitioner, pursuant to the impugned order passed u/s 147 Rlw Section 144, read with section 144B of the lncome Tax Act vide DIN No. ITBA/AST tsl147 /2023- 2411060208061(1)and the Notice of demand under section 156 of the Income-Tax Act, '1961, dated 06.03.2024, vide DIN and Notice No. ITBA/AST/S/'1 5612023- 2411062093295(1), by the 3rd Respondent for A.Y 2015-16, in PAN No AULPC00l4Fti'l '1 the final disposal of this writ petition Counsel for the Petitioner: SRI VENKATRAM REDDY MANTUR Counsel for Respondents: SRI J. V. PRASAD SC FOR INCOME TAX The Court made the following: ORDER I THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUS?ICE NAMAVARAPU RA\"IESHWAR RAO ORDER: (per Hon'ble Justice Sujog Paul) Heard Sri Venkatram Reddy Maltur, learned counsel for the petitioner ald Ms.B.Sapna Reddy, learned Junior Standing Counsel representing Sri J.V.Prasad, learned Senior Standing Counsel for Income Tax Department, for the respondents. 2. The ground taken by the learned counsel for the petitioner(s) is that in furtherance of Finance Act, 2021, re- ; assessment process stood modified but the respondents have not taken care of it ald therefore notice issued under Section I48 of the Income Tax Act, 196 1 cannot sustain judicial scrutiny. Since notice is bad in law, the consequential orders are a,lso bad in law. 3. During the course of hearing, learned counsei 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 ald other connected matters, decided by common order IVRIT PETITION No.15353 OF 2o24 2 dated 14.09.2023. Thre parties agreed that this matter may be disposed of in terms of the Common Order dated 14.09.2023 4. This Court in the said order dated 14.09.2023 in W.P.No.25903 of 2022, held as under: '35. In 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 reasscssment being u[der Sectiotr 148A, the subsequent proceedings was mandatorily requiied to be undertaken under the substituted provisions as laid down under the Finance Act, 2021. In the absence of which, we are constraiEed to hold that the procedure adopted by the respondent-Department is in contraveatioa to the statute i.e. the Finance Act,2021, at the ,irst 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 impugred notic€s issued and the proceedings drawn by the *espondent-Department is aeither tenable, nor sustaiDable. The notices so issued and the procedure adopted being per se illegal, deserves to be and a.e accordingly set aside/quashed. As a consequeDce, all the impugned orders gettiag quashed, the colsequential orders passed by the respolrdert Department pursuant to the notices issued uldet Section 147 atrd 148 would also get quashed and it is ordered accordingly. The reason we are quashing the consequential 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 prelimirary objectioa raised by the petitioae. is sustained atld all these writ petitious stards allowed on this very jurisdictional issue. Sitrce the impugned notices and orders are getting quashed oE the point ofjurisdiction, we are aot inclined to proceed further and decide the othe. issues .aised by the petitioner which stalds reserved to be raised and conterded in an app.opriate proceedings. 38. Since the llon'ble Supreme Court had, in the case of Ashish Agafl al, supra, as a one-time rneasure exercising the powers under Article 142 of the Constitution of India, i permitted the Revenue to proceed under the substituted provisions, and this Court allowing the petitions only on the ptocedural flaw, the right conferred on the Reveaue would rerlailr reserved to proceed further if they so want from the stage of the order of the Supreme Coutt in the case of Ashish Agarnral, 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 accordarce with law as per pa.ragraph No.38 of the order dated 14.09.2023 in W.P.No.25903 of 2022. 6. The writ petition is allowed. No costs. Interlocutory applications, if any pending, sha1l also stand closed. //TRUE COPY// SD/- V. HARI PRASAD ASSISTANT REGISTRAR SECTION OFFICER To, 1 2 J The Assistant Commissioner of lncome Tax,, Ward 15 (1), Hyderabad, lncome Tax Towers, AC Guards, Masab Tank,HyderaOad-50b00+ The Principal Chief Commissioner of Income iai lncome Tax Towers,, AC Guards Masab Tank. Hyderabad-500004 The Assessment Unit, lncome Tax Department National Faceless Assessment Centre Room No 401, 2nd Floor ERamp Jawaharlal Nehru Stadium Delhi 110003. One CC to Sri Venkatram Reddy Mantur Advocate [OpUC] 9nu 99 to Sri J V Prasad (SC FOR TNCOME TAX)'Advocire tOpUCl Two CD Copies 4 5 6 MBC LS 0{- I --- s{qr* WITHOUT COSTS HIGH COURT DATED: 2010612024 rC'ri' () (.) 11 1 B Ct' 20it ::t li- ..,.; t ORDER WP.No.15353 of 2024 ALLOWING THE WRIT PETITION %'\" "