Sri. Nagabushanarn Nalla V. Assessment Unit, National Faceless Assessment Centre, Income Tax Department, Ministry of Finance and The Income Tax Officer, Ward - 1

WP/21771/2024

AI Insights

The case involves Sri. Nagabushanarn Nalla, the petitioner, challenging a notice issued under Section 148 of the Income Tax Act, 1961, by the Income Tax Officer, Ward - 1, Siddipet, and the subsequent assessment and penalty orders for the assessment year 2018-19. The petitioner argued that the notice was without jurisdiction, arbitrary, illegal, and violated several provisions of the Income Tax Act as well as the circular issued by the CBDT. The court referenced a previous common order in W.P.No.25903 of 2022, which had addressed similar procedural flaws in the re-assessment process as modified by the Finance Act, 2021. The court found that the procedures followed by the respondents were not in compliance with the statutory requirements, leading to the quashing of the notice and consequential orders.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 688179 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 09-08-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal
• Laws Referred To: Income Tax Act, 1961, Finance Act, 2021, Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: BOKARO SAPNA REDDY
• Assessee Lawyers: A V RAM
• Keywords: Arbitrary; Illegal; Jurisdiction; Procedural Flaw; Re-assessment process; Void ab initio; Writ of Mandamus; Assessment and Penalty Orders
• Section: 147; 148; 144; 149; 271AAC; 148A; 151A; 271A; 226

Judgement Text

"[ 3408 ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) FRIDAY ,THE NINTH DAY OF AUGUST TWO THOUSAND AND IWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL & THE HONOURABLE SRI JUSTICE J SREENIVAS RAO WRIT PETITION NO: 21771 OF 2024 Between: Sri. Nagabushanarn Nalla, S/o. Sri lt4allaiah, Aged about 45 years, Occupation. Private Service, 1-20, Kolgur, Gajwel. Siddipel - 502278. ...PETITIONER AND 1 Assessment Unit, Nalional Facel:ss Assess:oenl Centre. lncome Tax Department, lv!inistry of Finance, Rcom l.iD. -1C 1 . 2nd Floor, E-Ramp, Jawaharlal Nehr'u Stadi:m Delhi - i '10003 The lncome Tax Officer, Ward - 1 .8-1-22.1 st Floor, Subhash Road, Siddipet - 502103. ...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 pass an order or direction, especially one in the nature of WRIT OF MANDAMUS holding that the notice dated 06,04.2022 issued by 2nd Respondent under section 148 of the Act with DIN and Notice No. ITBA/AST/S/148_112022- 2311042562160(1 ) as being without jurisdiction. arbitrary, illegal, bad in law, void ab initio, apart from being violative of provisions of section 148A and section 149 of the Act and also contrary to the circular issued by CBDT and provisions of section 151A of the Act, and consequently set aside the notice under section 148 dated 06.04.2O22 and the assessment and penalty orders passed by 1st Respondent for asst. year 2018-19 under section 1 47 r.w-s 144 r.w.s 1448, 27OA and 271AAC(1) of the Act, respectively. 2 1 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 collection of tax and penalty demands raised by .lst Respondent for the Ay.2018-19. Counsel for the Petitioner: SRI A. V. RAGHU RAM Counsel for the Respondents: SMT. BOKARO SApNA REDDy (Jr. SC FOR TNCOME TAX) The Court made the following: ORDER I I THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE J' SREENTVAS RAO WRIT PETITION No.21 77L oF 2024 ORDER: (per Hon'ble Justice Sujog Paul) Heard Sri A.V.Raghu Ram, learned counsel for the B. Serpna RcddY, learned Junior Incomc 'lax DePartment, for the petitioner(s) and Ms' Stalding Counsel for respondents. 2. The ground taken b-v the learncd counsel for the petitioner(s) is that in furtherance of Finance Act' 2O2l' re' assessment process stood modified but the respondents have not taken care of it and therefore tlotice issued under Section 148 of the Income Tax Act, 196 i cannot sustain judicial scrutiny. Since notice is bad irl larv' the cotlsequential orders are also bad in law. 3. During the course of hetrring' Icartled counsel for the parties agreed that curtains on this issuc are hnzrlly drawn by this Court in a batch of u'rit petitions' W'P'No'259o3 of 2022 and other connected matters' decided by common order dated 14.09.2O23. The parties agrced that this matter may be disposed of in terms of the Common C)rder datecl l4'O9'2O23' // I I 2 4. This Court in the said order W.P.No.259O3 of 2022, held as under: dated 14.09.2O23 in \"35. In viep of the aforesai crear that the procedure aou. ot:_:\"\"'oo\", it is by ,,ow very Department\"r\"\"o\"u.ror.o.1\"o:::Jrl\":;r::.:\"::::::: beiag under Sectioa 1484, I rua[dato.iry required to b€ uthe subsequeut proceediags Fas provisions as Laid dowD .rou\"\"u\"*oto uDder the substituted abseace of which, ure ..u 't *\" Fioaace Act' 2021' rn tle procedure adopted by ao. \"oo\"otto\"u to hold that ti' co.trave[tion to the stat'te r respondent_DePartT ent is in rirst instarce. \"*\" \"\"\",,.,\"'1\"'.\"i\"'Ilji ljl.Tl;1lij the directives issued by the lloa,ble Supteme Court in tfre case of Ashish Agarqral, supra. 36. For aU the aforesaid reasor and the p.oceedin\"\" \".J;-J;:::;;::Xff ::\":::: neithet teaable, lor sustainat the procedure \"u\"n.\"u o\"i\" J\"l,'\"Jil:::.'\"\"\"Tj.o: ::: are accordingly set aside/qEashed. a, a \"oo\"aq,r\"oa., \"If tt \" itEpugled ordets gettirg quashed, Ure aoo..qr\"oU\"t o.aur. passed by the respondeot DepartDent pu.suant to the uotices issued uoder SectioD l4Z and I it is ordered accorditrSty. ,o\"ot -o,o arso get quashed ard coasequential order i6 oa ao \"t\"\"oo se are quashi[g the ioitiation \", ,o\" nr\"\"\".uio-*'-e priaclples tlat when the thesubsequentora.*\"*;;\"\";\"'ffi :.,:t::;'\"T::;*.\"\"-, 37. The pretiruiaery objection sustained and a, these *\", ;;:'::\"\".:\"\"\"::r:::j,::\":\":: very ju.isdictioual issue. Sincc orders are getting quashed oo ao' tor iepugred ,otices and aot incri.ed to proceed ,o\"ao.. t no'ot otrurisdictiotr, we are raised by the petitioaer which r decide the other issues and contended in ao .nn-rr\",. ffioliT.I'u to be raised 38- sloce tle HoDtle supreEe Court had, ia the case of Ashish Agarwal, supra, as a one_l powers uader Article 142 o, *t -tt**t exercising the permitted the Reveaue . n.\"\"Tjo ::::\"J:\"\"\"::#:: provisious, alrd this Court allowir procedural flaw, the rigtrt \"ooru,t\" *\" peutio.s onry o[ the Ted on tle Revenue would l To, reEain reserved to proceed further if they so want froe the stage of tie ordet of the Sup.cme Court ta the case of Ashish AgarFaL supra. 39. No order as to costs,\" 5. In view of the consensus arrived, the impugned Show Cause notice ald 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.38 of the ordcr dated 14.O9.2023 in W.P.No.259O3 of 2022. 6. The Writ Petition is allower_l. No costs. Interlocutorv applications, if any pending, shall also stand closed. SD/. V. HARI PRASAD ASSISTANT REGISTRAR ,TRUE COPY// SECTI N OFFICER 1- Assessment Unit, National Faceless Assessment Centre, lncome Tax Department, Ministry of Finance, Room No. 4O1 ,znd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi - 1 10003. 2. The lncome Tax Officer, Ward - 1, 8-1-22,1 st Floor' Subhash Road, Siddipet - 502103. 3. One CC to SRI A. V. RAGHU RAM, Advocate [OPUC] 4. One CC to SMT. BOKARO SAPNA REDDY (Jr. SC FOR INCOME TAX) [oPUC] 5. Two CD Copies GBR GJP PAE.. I HIGH COURT DATED:0910812024 ORDER WP.N o.21771 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS (j .) ) t ? 1 0cI 202l Dr .// r+ q(tt,. . 6c?\" . "