Telangana Building and Other Construction Workers Welfare Board V. Union of India and Central Board of Direct Taxes and Chief Commissioner Income Tax, Hyderabad and Commissioner Income Tax Exemption Hyderabad and Director Income Tax Exemptions and Additional Director Income Tax Exemptions and Deputy Director Income Tax Exemptions and The National eAssessment Centre and Commissioner of Income Tax Appeals Hyderabad and Commissioner Income Tax Appeals, The National Faceless Appeal Centre

WP/23091/2024

AI Insights

The case involves the Telangana Building and Other Construction Workers Welfare Board, a statutory board, challenging an income tax assessment order and subsequent appellate order. The petitioner argued that they were exempt from income tax under specific notifications, which the appellate authority failed to consider, instead relying on Central Board of Direct Taxes (CBDT) office memorandums that required a 20% deposit of the demand. The High Court found that the appellate authority did not adequately address the exemption notifications in their decision, leading to the decision to restrain further coercive actions until the appeal is adjudicated.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 703173 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 28-08-2024
• Assessment Year: misc
• Laws Referred To: Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, Article 226 of the Constitution of India
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: GADI KUMAR; A KRISHNA REDDY
• Assessee Lawyers: AVINAS DESAI; M PRANAV
• Keywords: Appellate Authority; Assessment Order; Coercive Action; Income tax exemption; Writ of Mandamus
• Section: 151 CPC

Judgement Text

"13411 | HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY,THE TWENTY EIGHTH DAY OF AUGUST TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION NO: 23091 OF 2024 Between: Telangana Building and Other Construction Workers Welfare Board, A Board constituted under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, Having its office at D.No. 1-1-18173, First Floor, Tanguturi Anjaiah Karmika Sankshema Bhavan, RTC X Roads, Hyderabad-500020 Represented by its Secretary and Chief Executive Officer, E. Gangadhar S/ o. Late Sri E.P. Naih aged about 50 years ...PETITIONER AND 1. Union of lndia, Represented by its Revenue Secretary, Ministry of Finance, Department of Revenue, North Block, New Delhi-'l '10022 2. Central Board of Direct Taxes, Represented by its Chairman Central Board of Direct Taxes No(h Block New Delhi 3. Chief Commissioner lncome Tax, Hvderabadl AC Guards Hyderabad 4. Commissioner lncome Tax Exemption Hvderabad, Ayakar Bhavan Basheerbagh Hyderabad 5. Director lncome Tax Exemptions, Ayakar Bhavan Basheerbagh Hyderabad 6. Additional Director lncome Tax Exemptions, Ayakar Bhavan Basheerbagh Hyderabad 7. Deputy Director lncome Tax Exemptions, Ayakar Bhavan Basheerbagh Hyderabad 8. The National eAssessment Centre, Room No, 401 2 Floor ERamp Jawaharlal Nehru Stadium Delhi 9. Commissioner of lncome Tax Appeals Hyderabad, Aayakar Bhavan Basheerbagh Hyderabad 10- Commissioner lncome Tax Appeals, The National Faceless Appeal Centre Room No. 4O1 2 Floor ERamp Jawaharlal Nehru Stadium ?lHLrrO*r=\"r, Petition under Article 226 oI the Constitution of lndia praying that in the circumstances stated in the affidavit fi{ed therewith, the High Court may be pleased to issue a writ, order or a direction, particularly one in the nature of a writ of mandamus declaring the action of Respondent No.4 in passing the Order dated 07.08.2024 bearing number ITBA/COM/F/1 7 12024-251 10673901 76(1 ) as 7'being illegal, arbitrary arrd rtnconstitutional and consequently, i. Set aside the Order dated 07 08.2024 bearing number |fBA/COIV/F/1712024- 251106739017 6(1 ) passed by the Respondent No. 4, ii. Set aside the Assessment Order daterj 27.02.2024 bearing number bearing number ITBA/ AST/S/144l 2023-2411061626766 (1) and all subsequent proceedings initiated pursuant to the Assessment Order daled 27.02.2024 bearing number ITBA/ AST lS I 1 44t 2023-24t 1 06 1 526766 ( 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 direct the Respondents not to take any coercive steps lA NO: 2 OF 2024 Petition under Section I51 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 the Assessment Order dated 27.02.2024 bearing number bearing number ITBA/ AST/S/1 441 2023-241 1061626766 (1) and ail subsequent proceedings Counsel for the Petitioner: SRl. AVINAS DESAI SENIOR COUNSEL REp SRI M. PRANAV Counsel for the Respondent No.1: SRI GADI PRAVEEN KUMAR Dy. SOLICITOR GEN. OF INDIA Counsel for the Respondent Nos.2to10: SRI A. RAMA KRISHNA REDDYREp SRI A. RADHA KRISHNA, SENIOR SC FOR INCOME TAX DEPARTMENT The Court made the following: ORDER '- /,/ l''/ ,/./ THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION No.23O9l OF 2024 ORDER: (per Hon'ble Justice Sujog Paul) Sri Avinas Desai, learned Senior Counsel representing Sri M.Pranav, learned counsel for the petitioner and Sri A.Rama Krishna Reddy, learned Counsel representing Sri A.Radha Krishna, learned Senior Standing Counsel for re spondent-Income Tax Department 2. With the consent, finally heard 3. This petition Iiled under Article 226 of the Constitution of India assails the order of learned appellate authority dated 07.o8.2024. 4. The background facts are that the petitioner is a Statutory Board constituted under the provisions of the Building and Other Construction Workers (Regulation of Employ.rnent and Conditions of Service) Act, 1996. The respondents issued two notifications dated 09. Il.2017 and 26.10.2023 (Annexures-P.9 ald P. 1O) exempting the petitioner from paying the income tax 5. Learned Senior Counsel for the petitioner submits that no doubt, the petitioner did not respond to the notice issued by the Departme nt, the firct remains that pctitioner is covered by the aforesaid notificatlons The respondents without considering the said exernption notihcations (Annexures-P.9 and P. 1O) passed the assessrnent order dated 27 .O2.2024 (Annexure P.2). Aggrieved, the petitioner preferred an appeal before respondent No.4. Along with irppeal, the petitioner preferred application for stay. The said application was partly allowed by directing the petitioner to deposrt 2O\"k of the demand i.e.Rs.69,71,75,824/- 6. The bone of contention of learned Senior Counsel for the petitioner is that the le arned appellate authority was totally guided by Centri:.I Board of Direct Taxes (CBDT) Office Memorandums da.ed 29.02.2016 and 31.07.2017 and on the strength of the sarne, directed the petitioner to deposit 2Oo/o of outstanding demand. There is no whisper or iota of discussion about exemption notifications (Annexures-P.9 and P. 10). The impugned order is, therefore, bad in law. The appellate authority shoulcl have at least discussed about the main ground of petitioner based on notilications (Annexures-P.9 and P. 1O) . The question of dr:positing of 2O'h of the demand would arise only when it is, prima facie, established that exemption notifications cannot be pressed into service for some reason. In the absence thereof, the impugned order is bad in law 3 7. Learned Standing Counsel supported the impugned order on the strength of CBDT Oflice Memorandums, dated 29.O2.2016 and 37.O7.2077. Despite repeated query from the Bench, learned Standing Counsel is unable to show any iota of discussions/application of mind about aforesaid notifications (Annexures-P.9 and P. 10) in the impugned order. 8. Pimafacie reading of Annexures-P.9 and P. 10 shows that petitioner could make out a pima facie case Sadly, the appellate authority has not taken any pain to consider the singular contention raised by the petitioner based on these notifications. 9. Thus, in the peculiar facts of this case, we deem it proper to restrain the respondents from taking any coercive action against the petitioner, pursuant to assessment order, during the pendency of the appeal 10. Accordingly, this writ Petition is disposed of. It is made clear that this Court has not expressed any opinion on the merits of the case. It will be open for the appellate authority to adjudicate the appeal on its own merits. This Court has protected the petitioner only on the basis of primo facie case made out by him and because of non-application of mind by the ,{ / 4 appellate authority on the ground so rncntionecl by the petitioner. No cos1.s Interlocuton/ appiications, if any pending, shall also stand closed sD/- v.KAVITHA //TRUE COPYII ASSTSTANS EGISTRAR SECTION OFFICER To, 1. Union of lndia, Represented by its Revenue Secretary, Ministry of Finance, Department of Revenue, North Block, New Delhi-1'10022 2. Central Board of Direct Taxes, Represented by its Chairman Central Board of Direct Taxes North Block New Delhi 3. Chief Commissioner lncome Tax, Hvderabadl AC Guards Hyderabad 4. Commissioner lncome Tax Exemption Hvderabad, Ayakar Bhavan Basheerbagh Hyderabad 5. Director lncome Tax Exemglions, Ayakar Bhavan Basheerbagh Hyderabad 6. Additional Director lncome Tax Exemptions, Ayakar Bhavan 6ash6erbagh Hyderabad 7. Peputy.Director Inco.ne Tax Exemptions. Ayakar Bhavan Basheerbagh Hyderabad B. The National eAssessmenl Centre, Room No,401 2 Floor ERamp Jawaharlal Nehru Stadium Delhi 9. Commissioner of lncome Tax Appeals Hyderabad, Aayakar Bhavan Basheerbagh HyderabaC 10- Commissioner lncome Tax Appeals, The National Faceless Appeal Centre Room No. 401 2 Floor ERamp Jawaharlal Nehru Stadium Deli-ri 11.One CC to SRl. tU. PRANAV, Advocate IOPUCI 12.One CC to SRt. GAD| PRAVEEN KUMAR ,Dy. SOLtctToR GEN. OF tNDtA loPUCl 13.One CC to SRl. A. RADHA KRTSHNA , SENTOR SC FOR TNCOME TAX DEPARTMENT [OPt,,C] 14.Two CD Copies BM BSR v HIGH COURT DATED:2810812024 ORDER : =:: : :---- ,, f- iri . I ..- C, ca -t 1 2 tjEl.; i'i,;q 1\"- , ,- l WP.No.23091 of 2024 DISPOSING OF THE WRIT PETITION WITHOUT COSTS ;: ll .^y' rti (r n ..\". /l / ,t ,-. tfu/, "