Venkata Prasad Rao Edla V. Income Tax Officer Ward 6(1),Hyderabad,

WP/18955/2024

AI Insights

The case involves Venkata Prasad Rao Edta, the petitioner, challenging the assessment order passed by the Income Tax Department for the assessment year 2015-16. The petitioner argued that the notice issued under Section 148 of the Income Tax Act, 1961, and the subsequent orders were illegal and violated the principles of natural justice. The court referenced a batch of writ petitions, including W.P.No.25903 of 2022, where it was held that the procedures for re-assessment under the Finance Act, 2021 were not followed by the department. The court's decision was based on the procedural flaws in issuing the notices and conducting the assessments, leading to the quashing of all related orders.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 752878 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 19-07-2024
• Assessment Year: misc
• Other Referred Cases: Ashish Agarwal
• Laws Referred To: Income-tax Act, Finance Act, 2021
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: B SAPNA REDDY
• Assessee Lawyers: DUNDU MANMOHAN
• Keywords: Assessment Order; Faceless assessment; Income Tax; Natural Justice; Writ of Mandamus
• Section: 147; 148; 144B; 148A(d); 226

Judgement Text

"HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE NINETEENTH DAY OF JULY TWO THOUSAND AND TWENTY FOUR 134111 ...PETITIONER PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAUL THE HoNoURABLE SRI IusTTcITTDTvTAVARAPU RAJEsHwAR RAo WRIT PETITI ON NO: 18955 0F 2024 Between: Venkata Prasad Rao Edta S/o Edla Venkatiah, Aqed about 66 years, Occ. Pvt. Emptoyee, Ftat No 414, a-s-eaa. A;;;ioEi:'S;\"\";ii Heavens, Hyderabad, Telangana - 500023. AND 1_ 2 J lncome Tax Officer Ward 6(1),Hyderabad, I T Tower, AC Guards, Masab Tank, Hyderabad - 500004. The Principal chief commissioner of rncome Tax Ap And rs, 1Oth Froor, c_ Block, l.T. Towers, 10-2-3, A.C. CrarOs, HvjJrrt\"A_HOooOa. The Assessment Unit, lncome Tax Department, National Faceless Assessment centre. Derhi rvtinisrry oi Fina\".{H16.\"r.r\" qoi , ina F6;;, E: Ramp, Jawahartat Nehru Stadium,'oelni_ii000b.'-\"\"' ...RESPONDENTS Petition under Articre 226 of the constitution of rndia praying that in the circumstances stated in the affidavit firecr therewith, the High court may be pleased to issue an appropriate writ order or direction more particularly one in the nature of writ of l Iandamus, decraring the Assessment order dr. 06/0212024 passed by the 3rd respondent urs 147 r.w.s144B of the rncome-tax Act for A.y. 2015-16 vide DrN No. ITBA/ASTrsr147r2023-24i1060535973(1), consequent to the order passed u/s 148A(d) dt.oilo4t2o22 vide DrN No. |TBA/AST/F/I48Ar2022-23r1042632624(1) and the norice u/s 148 dt.o7ro4r2o22 vide DIN No. |rBA/ASTrstl4B-112022-2311o4263gsg4(.r ), issued by the JAo(1st respondent) instead of FAO(3rd respondent), as void, illegal, and contrary to the provisions of rncome-tax Act and contrary to the principres of Naturar Justice. ,' lA NO: 1 OF 2024 Petition under Section 151 CPC praying that in tht: circumstances stated in the affidavit filed in support of the petition, the High court nray be pleased to stay all further proceedings pursuant to the Assessmenl ordr>r dt 0610212024 passed by the 3rd respondent uls 147 r.w.s144B of the lncom3-tax Act for A.Y. 201 5-'1 6 vide Dl N No. ITBA/AST/ Sl 1 47 I 2o23-24l1 0605359 73( 1 )' Counsel for the Petitioner: SRI DUNDU MANMOHAN Counsel for the Respondents: M/s. B.SAPNA REDDY, Jr' SC FOR lT DEPT' The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HOITOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION No.18955 OF 2o24 ORDER: (per Hon'ble Justice Sujog poul) Heard Sri Dundu Manmohan, Iearned counsel for the petitioner(s) arld Ms. B.Sapna Reddy, learned Junior 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 Financ e Act, 2021,, re assessment process stood modified but the respondents have not taken care of it and therefore notice issued under Section 148 of the Income Tax Act, 1961 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 finally drawn by this Court in a batch of writ petitions, W.p.No.2590 3 of 2022 and other connected matters, decided by common order dated 14.09.2023. Tllre parties agreed that this matter may be disposed of in terms of the Common Order dated, 14.O9.2023. .1. 2 4. This Court in the said order dated 14'O9'2023 in W.P.No.259O3 of 2022' held as under: \"35. In view of the aforesaid discussions, it is by now vety clear that the Procedure to be followed by the respoldent- Department upoD treatiag the Eotices issued fol r'easses$ment being under Sectio! 148A, the subsequcnt ptoceedings was mandatorily required to bc uadertaken uflder th€ subst:ituted provisions as laid dowa under the FilaEce Act, 12021' l'o the absence of which, we are coasttalned to hold thqt the procedute adoPted by the respondeEt-Department is in contravention to the statute i'e' the Finatrce Act' 2O2l' at the Iirst instaace. SecoEdly' it is also itr direct contraveation to the directives issued by the Hon'ble Supreme llourt :in the case of Ashish AgaFral, supra. 36. For all the aforesaid reasons, the iEpugled rotices issued and the proceedings drawE by the respondent-DepartE{eat is neither tenabte, uor sustaiEable. The Eotices s': issut'd and the procedure adoPted beilg per se iUegal, desedes to be and are accordiEgly set aside/quashed. As a coascqlteirce' all the impugned orders getting quashed, the consequential orders passed by the resPondent DcpartEe[t Pursualt to the lrotices issued uadcr section 147 and 148 would also get quashed and it is ordered accordingly. The teason Ee are quashiEg the consequential order is on the priEciples thrrt wh()n the iDitiation of the ptoceedings itself was procedurally wrong' the subsequent orders also gets nulllfied automai:ically' 37. The PretiEinary objection raised by the petiti('aer is sustained and all these ttrrit pctitions staads a[[oq'ed cr1 this very jurisdictional issue' since the impugned aotices and orders ate getting quashed on the poirt of jurisd'iction' we are not incliEed to proceed firrther aad declde tbe othet issues raised by the petitioler which stands teservecl to b€ raised and contended in an appropriate proceedings' 38. Since the Hon'ble SuPleme Court had, in the case of Ashish Agarwal, suPra' as a one-tiEe measure exercising the powers urdet Article 142 of the Constitution ol ltrdia' permitted the Rcvenue to proceed urder the subitituted provisions, and this Court allowing the Petitiolrs only oE the procedutal flaw' the right conferred oE the Fleve[u'] would .7 To, 6. BSR temain reserved to proceed further if they so want from the stage of the order of the SupreEe Court ir the case of Ashish Agarwal, supra. 39. No otder 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.38 of the order dated 14.09.2023 in W.P.No.25903 of 2022. I 6. The Writ Petition is allowed. No costs. Interlocutory applications, if any pending, sha11 also stand closed. SD/. T. JAYASREE ASSISTAN REGISTRAR //TRUE COPYII SECTION OFFICER 'I . lncome Tax Officer Ward 6(1),Hyderabad, I T Tower, AC Guards, Masab Tank, Hyderabad - 500004. 2. The Principal Chief, Commissioner of lncome Tax AP and TS, 1Oth Floor, C- Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004. 3. The Assessment Unit, lncome Tax Department, National Faceless Assessment Centre, Delhi, tvlinistry of Finance, Room No. 4O1 , 2nd Floor, E- Ramp, Jawaharlal Nehru Stadium, Delhi-1 10003. 4. One CC to SRI DUNDU MANMOHAN, Advocate [OPUC] One CC to M/s. B.SAPNA REDDY, Jr. SC FOR lT DEPT. [OPUC] Two CD Copies cJP q.- t I i i i I HIGH COURT DATED: 1910712024 ORDER oF H NF 1108i ffi i i '_) io .j .t'I WP.No.18955 of 2024 ALLOWING THE WRIT PETITION, WITHOUT COSTS .a o^r Lgeod W .6-rq >l € "