Spartek Ceramics India Limited V. The Union Of India and The Principal Chief Commissioner of Income Tax, National E-Assessment Centre and The Income Tax Officer, Circle 1(1), Tirupati and The Additional/Joint/Deputy/Assistant Commissioner of Income Tax National Faceless/E-Assessment Centre and Assessment Unit, Income Tax Department

WP/28844/2024

AI Insights

M/s. Spartek Ceramics India Limited filed a writ petition challenging the penalty and demand notices issued by the Income Tax Department for the assessment year 2018-19. The petitioner argued that these actions were arbitrary, illegal, and contrary to an earlier interim order of the High Court which had stayed the operation of the assessment order. The respondents, including various officials of the Income Tax Department, conceded to the position that the penalty and demand notices were issued in violation of the stay order. The court, therefore, set aside the penalty order and the demand notice, emphasizing adherence to judicial precedents and the rule of law.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 695755 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 09-12-2024
• Assessment Year: misc
• Other Referred Cases: WP. No. 11582 of 2024
• Laws Referred To: Constitution of India, Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: PASALA RAO; Y N VIVEKANANDA
• Assessee Lawyers: M S CKR ASSOCIATES
• Keywords: Demand notice; Faceless assessment; Fundamental rights; Interim order; Penalty notice; Writ of Mandamus
• Section: 274; 270A; 151; 226

Judgement Text

"IN THE HIGH COURT OF ANDHRA PRADESH :: AMARAV. (Special Original Jurisdiction) <4 MONDAY ,THE NINTH DAY OF DECEMBER TWO THOUSAND AND TWENTY FOUR '<5 Ct o>i PRESENT THE HONOURABLE SRI JUSTICE G.NARENDAR AND THE HONOURABLE SRI JUSTICE T.C.D.SEKHAR WRIT PETITION NO: 28844 OF 2024 Between: M/s. Spartek Ceramics India Limited, Regd. Off. Narsingapuram Mitta Palem Mandragiri Taluk, Chittoor, Andhra Pradesh-517 102. Rep. by its Authorized Signatory, T.Mani. ...PETITIONER AND 1. The Union Of India, Represented by its Secretary (Revenue), Ministry of Finance, Department of Revenue North Block, New Delhi - 110001 2. The Principal Chief Commissioner of Income Tax, National E- Assessment Centre, Income Tax Department, Delhi, 2nd Floor, E- Ramp, Jawaharlal Nehru Stadium, Delhi - 110 003 3. The Income Tax Officer, Circle 1(1), Tirupati. 4. The Additional/Joint/Deputy/Assistant Commissioner of Income Tax National Faceless/E-Assessment Centre, Delhi, Income Tax Department, Delhi, 2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi-110003. 5. Assessment Unit, Income Tax Department ...RESPONDENTS Petition under Article 226 of the Constitution of India 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 one in the nature of Writ of Mandamus Notices of penalty No. ITBA /PNL IS /270A/2023- 24/1063106988(1) dated 21.03.2024 under Section 274 read with 270A of the ITA (Penalty Notice) under Section 270A of the ITA and thereafter passing the consequential penalty order vide DIN. No. ITBA /PNL /F /270A /2024-25 /1066811280(1) dated 18.07.2024 (Impugned Penalty Order) under section 270A of the ITA and consequently demanding a penalty payable amount of Rs. 14,97,594 /- vide Demand Notice vide DIN and Notice No. ITBA/PNL/S/156/2024-25/1066806619 (1) dated 18.07.2024 (Penalty Demand Notice) passed by the 5th Respondent for the AY 2018-19 as arbitrary, illegal, one without power or jurisdiction and contrary and against the Interim Order passed by this Honourable High Court of Andhra Pradesh at Amaravati vide WP. No. 11582 of 2024 dated 10.05.2024 apart from being violative of the fundamental rights guaranteed under Articles 14, 19 and 21 of the Constitution of India and / to me consequently set aside the same. lA NO: 1 OF 2024 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 Penalty Order vide DIN.No.ITBA /PNL F /270A /2024-25/1066811280(1) dated 18.07.2024 (‘Impugned Penalty Order”) under Section 270A of the ITA and consequent Demand Notice vide DIN & Notice No; ITBA/PNL/S/156/2024-25/1066806619(1) dated 18.07.2024 (‘Penalty Demand Notice’) passed by the 5*^ Respondent. / • < A 0' Counsel for the Petitioner(s): M/S CKR ASSOCIATES / Counsel for the Respondent No.1: SRI PASALA PONNA RAO, DEPUTY SOLICITOR GENERAL OF INDIA / / / / Counsel for the Respondent Nos.2 to 5: SRI Y N VIVEKANANDA, SC FOR INCOME TAX The Court made the following: ORDER 1 HON’BLE SRI JUSTICE G.NARENDAR AND HON’BLE SRI JUSTICE T.C.D. SEKHAR WRIT PETITION No. 28844 of 2024 JUDGMENT:- (per Hon’ble Sri Justice G.Narendar) Heard the learned counsel for the petitioner and 1. Sri.Y.N.Vivekananda, learned senior standing counsel for the respondent-department. The petitioner is before this Court being aggrieved by the order of penalty, dated 18.07.2024 and the subsequent notice of demand, dated 18.07.2024. 2. The short ground on which the instant writ petition is canvassed is that the levy of penalty and notice of demand are in the teeth of the earlier order of Coordinate Bench of this court in 3. W.P.No.11582 of 2024 whereby, the Coordinate Bench has recorded in paragraph Nos.7, 8 and 9 as under; “1. In the present case, the order of assessment has been passed, but in view of the submission that since the initiation of the proceedings was not as per the procedure and the provisions of the statute, the order of assessment is also bad, the matter that also requires consideration is, if the imitation is not as per the procedure prescribed, what would be its effect on the ultimate order passed which may be in the faceless manner. 8. Let the counter affidavits be filed within a period of four (04) weeks. 9. In view of the aforesaid, the operation of the impugned order of assessment shall remain stayed and no coercive steps will be taken till the next date of listing. ” { ( 1 ^ i 2 4. The Coordinate Bench in paragraph No. 9 has been pleased to stay the order impugned. The impugned having been stayed, the respondent-Department could not have proceeded to the next stage of levying of penalty and demanded payment of the same. assessment 5. The learned senior standing counsel would fairly concede the position. 6. In that view of the matter, the impugned order of dated 18.07.2024 and the subsequent notice of demand 18.07.2024 are hereby set-aside. 7. The show cause notice, dated 21.03.2024 adjudicated after the disposal of the pending Writ Petition. Accordingly, the Writ Petition stands ordered in the above terms. There shall be no order as to costs. As a sequel thereto, the miscellaneous pending in this case shall stand closed. penalty, , dated shall be 8. petitions, if any. Sd/- M SRINIVAS assistant registrar secti^Tofficer //TRUE COPY// To. I 1. The Principal Chief Commissioner of Income Tax Natinn^i f. RamTSh'^aTJl 3. The Income Tax Officer, Circle 1(1), Tirupati. Commissioner National Fac^ess/E-Assessment Centre Department, Delhi, 2nd Floor ^ Delhi-110003. 2. of Income Tax, Delhi, Income Tax t-Ramp, Jawaharlal Nehru Stadium $■ 5. Assessment Unit, Income Tax Department 6. One CC to M/S CKR Associates, Advocate [OPUC] 7. One CC to Sri.Pasala Ponna Rao, Deputy Solicitor General of lndia[ Advocate [OPUC] 8. One CC to Sri Y N Vivekananda, SC for Income Tax[OPUC]. 9. Three CD Copies / Y HIGH COURT DATED:09/12/2024 ORDER WP.No.28844 of 2024 e 0 2 MAY 2025 . Current Section * rti: co> •I*/ WRIT PETITION IS ORDERED WITHOUT COSTS "