Shaik Imam V. Union of India, Ministry of Finance and The Principal Chief Commissioner, Telangana and The Income Tax Officer, Ward 1 Khammam and Assessing Officer, National Faceless Assessment Centre, Khammam

WP/23834/2024

AI Insights

The case involved a writ petition filed by Shaik Imam against the Union of India and other respondents, challenging the legality of an assessment order for the assessment year 2018-19. The petitioner argued that the notice issued under Section 148 of the Income Tax Act, 1961, was invalid as it did not comply with the reassessment procedure revised by the Finance Act, 2021. The court referenced a common order from a batch of writ petitions (W.P.No.25903 of 2022) decided on 14.09.2023, which had similar issues. In that order, the court had held that the procedures followed by the Income Tax Department were in contravention of the statute and the Supreme Court's directives, leading to the quashing of the notices and subsequent orders.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 803958 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 02-09-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal
• Laws Referred To: Article 226 of the Constitution of India, Finance Act, 2021, Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: B MUKHERJEE; B REDDY
• Assessee Lawyers: E BABU
• Keywords: Assessment Order; Certiorari; Certiorari; Fundamental rights; Jurisdiction; Natural Justice; Writ petition
• Section: 147; 148; 148A

Judgement Text

"[3411] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE SECOND DAY OF SEPTEMBER TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION NO: 238340F 2024 Between: 9ouse Motri-ud9il,SiS Shaik Imam, Aged 45 years, 105 Bass plantation, Dr. Macon, GA-3'1210, USA, Represented by ^S.t -!yp-!4uA!!1, S/o. Sk tmam, Aged 40 years, Occ. Business, Rlo. Bl1129711 . BK Bazar, Khammam, Khai.rmam Disi - 507 OO1. ...PETITIONER AND 1 Union of lndia, Ministry of Finance, Rep. by The principal Chief Uommrssroner, I elangana. The lncome Tax Officer, Ward 1 Khammam. Assessing Officer, National Faceless Assessment Centre, Khammam. ...RESPONDENTS Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a writ, order or direction more particularly in the nature of Certiorari declaring impugned assessment order passed by the 3d Respondent against the Petitioner for the A.Y. 2018-19 vide DtN No. ITBA/ASTlsl147tt2123- 241'1061207644(1) Dr. 201212024 as illegal, whotty without jurisdiction, viotative of natural justice and fundamental rights of the Petitioner under Article 14 and consequently quash the same. restrain the Respondents from further action in pursuance to the impugned assessment order. 2 3 i I l IA NO: 't OF 2024 PetitionunderSectionl5lCPCprayingthatinthecircumstancesstatedin the affidavit filed in support of the petition, the High Court may be pleased restrain the Respondents from taking further action in pursuance to the impugned assessment order passed by the 3'd Respondent against the Petitioner for the A.Y' 20 1 8- 1 9 vide D I N No ITBA/AST/ S t 1 47 t2O23-24 t 1 061 2O7 644 (1)Dt 20 l2l2j24' Counsel for the Petitioner: SRI E. HARI BABU counsel for the Respondent No.1: SRI B' MUKHERJEEE' REPRESENTING-F-OR sRl GADi PRAVEEN KUMAR Dy' SOLlClroR GEN' OF INDIA Counsel for the Respondent Nos'2 and 3: MS' B' SAPNA REDDY' SC FOR INCOME TAX DEPARTMENT The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAIVIAVARAPU RAJESHWAR RAO WRIT PETITION No.238340r. 2024 ORDER: (per Hon'ble Justite SujoA pout) Heard Sri E.Hari Babu, learned counsel for the petitioner(s), Sri B. Mukherjee, learned counsel representing Sri Gadi Praveen Kumar, learned Deputy Solicitor General of India, for the respondent(s)-Central Government and Ms. B.Sapna Reddy, learned Junior Standing Counsel for Income Tax Department, for the respondent(s)- Income Tax Department. 2. The ground taken by the learned counsel for the petitioner(s) is that in furtherance of Finalce Act, 2021, re assessment process stood modihed 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 law. 3. During the course of hearing, learned counsel for the parties agreed that curtains on this issue are hnally drawn by this Court in a batch of writ petitions, W.P.No.25903 of 2022 7 and other cor,nected matters, decided by common order dated i4.09.2023.The parties agreed that this matter Inay be disposed of in terms of the Common Order dated 14 .O9 .2023 ' 4. This Cotrrt in the said order dated i4.09.2023 in W.P.No.25903'tf 2022, held as under: \"35. In viec/ of the aforesaid discussions, it is by now very clear thet the procedurc to be follosed by the respondent- Department upor treating the notices issued fot teassessmeDl: being under Sectio! 148A, the subsequent proceedings was mandatorily requfued to be undertaken uDder the substituted provisions as taid dowtr uEder the FiDance Act,2O2l. In the absence of lrrhich, we are constrained to hotd that the procedure adopted by the respoEdent-Department is in contravention to the statute i.e. the Fiaarce Act' 2O21, at the first instance. SecoDdly, it is also in direct contfave[tion to the directiwes issucd by the Hoo'ble Supterne Court in thc case of Ashish Agarwal, supra. 36. For all the aforesaid reasotrs, the impugned notices issued and the proceediogs drawa by the tesPondent-DePartment is neither t€nabte, aot sustaiEable. The aotices so issued and the procedure adopted beiag per se iuegal, deserves to be and are accordingly set aside/quashed. As a consequence, all the impugoed orders getting quashed, th€ consequential orders passed by thc respoadent DepartEeut Pursuant to the notices issued under Section 147 and 1zt8 would also get quashed ald it is ordered accordingly. The reasol we are quashing the consequeatial order is on the princiPles that when the initiation of the proceedhgs itself was Ptocedurally wrong, the subsequent orders also gcts nullilied automatically. 37. The preliminary objection taiEed by the Petitioner is sustained and all these writ petitions staads allowed on this very jurisdictiolal issue. Since the imPugEed Eotices and orders are gettitrg quashed o[ the poi[t ofjurisdictio[, we are not inclined to proceed further a[d decide the othel issues raised by the petitioner which stands reserved to be raised aad contended i[ an appropriate proceedings. 3 38. Since the tlo,l'ble Supreae Court had, in the case of Ashish Agarwal, supra, as a one-tilne Eeasure exercisiEg the posers ulder Article 142 of the Constitutiou of India, perEitted the Revenue to proceed uader the substituted provisions, alrd this Court allowing the petitions only on the procedural flaw, the right confeEed oE the ReveEue would re![aiE reserved to proceed further if they so eant from the stage of the order of the SupreEe 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 paragraph No.3B of the order dated 14.09,2023 in W.P.No.259O3 of 2022. 6. The Writ Petition is allowed. No costs. lnterlocutory applications, if any pending, shall also stald closed. //TRUE COPY// 6D/- N.stuHARt AsasT+Nr RplrRAR SECTION OFFICER To, 1. The Principal Chief Commissioner, Union of lndla, Ministry of Finance, Telangana. ! _--- 2. The lncome Tax Officer, Ward 1 Khammam. 3. Assessing Officer, National Faceless AssessmenfCentre, Khammam. 4. One CC to Sri E.' Hari Babu, Advocate [OPUC] -.- 5. One CC to Ms. Bl Sapna Reddy, SC for lncomeTax Department{OPUCI 6. One CC to Sri Gadi Praveen Kumar Dy. SoJicitor Gen. of lndia [OPUC] 7. Two CD Copi>) r^y TJ HIGH COURT DATED:0210912024 ORDER WP.No.23834 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS 2 J o 1rr. -)' c * q 'b lile,il-.1 - '.1.. ._') t s Pi.T r.l "