Counsel For The [Petitioner: ][Sri A v. Raghu Ram

HIGH COURT AT HYDERABAD(SPecial Original Jurisdiction) THURSDAY, THE FIFTH TWO THOUSAND PRESENT THE HONOURABLE ANDTHE HONOURABLE SRIJUSTICE WRIT PETITION [NOS.][24361 AND 24380 ][0F ][2024] wRlT PETITION NO.24361 [0F ][2024] Between: ed about 54urga Nagar, Mr. Syed Zaheer [Hussain, ][S/o]Mr. Sved Asqhar Hussain, [Ag]years, Occupation. Business.s-3-1istn3tE. MD Lines, [D]Hyderabad - 500008. ...PETITIONER AND 1The lncome Tax Officer, Ward [- ][14(1). ][t.T. ][Towers, ][A.C. Guards' ][Masabtank,]Hyderabad - 500004. Assessment Unit, National [Faceless Assessment Centre, lncome Tax]Room No..ior, zn d Floot' [E Ramp, ][Jawaharlal ][Nehru Stadium,]Room No..ior, zn d Floot' [E Ramp, ][Jawaharlal ][Nehru Stadium,]ij;-i[;;i;, DelhiDelhi Z .,.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 ][wRlT ][oF]MANDAMUS hotding that [the ][notice ][dated ][1 ][5/03/2023 issued ][by 1"t ][Respondent]under section 148 of [the ][Act ][(with DIN ][and ][Notice ][No.|TBA/AST/S/148 ][112022-]23t1O50814485(1)) as [being without ]iurisdiction, [arbitrary, ][illegal, bad in ][law, ][void]ab initio, apart from being [violative of ][provisions ][of section ][1 ][48A and section ][149]of the Act and also contrary [to ][the ][circular issued ][by ] [and ][provisions ][of]section 151A of the Act, [and ][consequently set aside ][the ][notice under ][section ][148]daled 1510312023 [and ][the ][assessment ][and ][penalty ][orders ][passed ][by ][1tr] for [asst. ][yeat ][2016-17 ][under section ][147 ][(w's ][144' ][271F ][and]Respondent 271(1)(b) of the [Act, ][respectively.] IANO:1 OF 2024 Petition under Section [15'1 ][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 ][1st ][Respondent ][for ][the]Ay.2O16-17 and stay the [pending penalty proceedings'] Counsel for the [Petitioner: ][SRI A. V. RAGHU RAM] Counsel for the Respondents: (Jr. SC FOR lNcoME TAx) WRIT PETITION [NO:][ 24380 ][0F ][2024] Between:Hvma Developers [M/s ][Hyma Developers Private ][Limited ][Bth]Frir"i sii etoir Mv Home Hub, [Ivtadhipur. ][Hyderabad ][- ][500081 ][Rep ][by ][its]bii""t"r., sri iupatty [Snyam Rao. S/o. ][Sii ][Jupaily Rameshwar Rao] ...PETITIONER ANDDeoutv Commissioner of [lncome Tax, Circle ][- ][2(1), 5th ][Floor,-signature]i.'l.i'",bJp Botanical [Gardens, Kondapur, Hyderabad ][- ][500084']...RESPONDENTSPetition under Arlicle [226 ][of ][the ][constitution ][of ][lndia ][praying ][that ][in ][the]circumstances [stated ][in ][the ][affidavit ][filed ][therewith, ][the ][High ][court ][may ][be]pleasedtopassanorderordirection,especiallyoneinthenatureofWR|ToFMANDAMUS [holding that ][the ][order passed by Respondent u/s.148A(d) of the ][Act,]d1.27.082024with [DIN and Notice ][No.ITBA/AST/Ft14'Al2024-25l'1068031668(1)]and the notice dated [27.08.2024 issued under ][section ][148 0f ][the Act ][with ] [and]Notice No.ITBA/AST/S/148_1/2024-2511068039457(1) [for the ][assessment ][year]2018-19, as being [illegal, arbitrary and passed ][in ][gross violation ][of ][principles of]natural [justice ]without [application of mind, ][and ][consequently set aside the same'] lA NO: 1 OF 2024 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]SuspendtheoperationofthenoticeissuedbytheRespondentu/s.148oftheAct,dt.27.08.2024 for the [assessment ][yeat ][2018-19 ][with ][DIN& ][Notice]No.ITBAJAST/S1148 [1t2024-25/1068039457(1) ][and all ][consequential proceedings]thereto. Counsel for the Petitioner: [SRI A. ][V. ] Counsel for the Respondent: [MS. ][J. ] [(JUNIOR SC FOR INCOME TAX)]The Court made [the ][following: ] THE HONOURABLE SRI JUSTICE ANDTHE HONOURABLE SRI JUSTICE WRIT PETITION NOS.24361 [24380 ][0F ][2][o24] COMMON ORDER[(per ]Hon'ble [SP,J)] Sri A.V.Raghu Ram, learned [counsel, appears ][for ][the]petitioners, Ms.B.Sapna [Reddy, learned ][Junior ][Standing ][Counsel]for Income Tax Department, [apPears ][for ][the ][respondent(s) ][in]W.P.No.2436 l of 2024 and Ms. [J.Sunitha, ][learned ][Junior]Standing Counsel for [Income ][Tax ][Department, ][appears ][for ][the]respondent(s) in W.P.No.243aO [of ][2024.] 2. Regard being had to the similarity [of ][the ][question]involved, on the [joint ]request of [the ][parties, ][the ][matters ][are]analoSously heard and decided [by ][this ][common order.] 3. It is common ground taken [by ][the ][learned counsel ][for]the [petitioner(s) ]that in furtherance [of ][Finance ][Act, ][202 ][1, ][re-]assessment process stood modifled [but ][the respondents ][have ][not]taken care of it and therefore notices [issued ]under [Section ][148]of the Income Tax Act, 1961 cannot sustain [judicial ][scrutiny.]Since notices are bad in lavr,, the consequential [orders are ][also]bad in law. 4. 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.25903 of [2022]and other connected matters, decided by common order dated14.09.2023. The parties agreed that this matter may be [disposed]of in terms of the Common Order dated 14.09.2023. 5This Court in the said order dated 14.09.2023 inW.P.No.259O3 of 2022, held as under: "35. [ln view of the ][aforesaid ][discussions, ][it ][is ][by ][now very clear that]the [procedure ]to be followed by the respondent-Department [upon]treating the notices issued for reassessment being under Section't48A, the subsequent proceedings was mandatorily required to beundertaken under the substituted [provisions ]as laid down under [the]Finance Act, 2021. ln the absence of which, we are constrained [to ][hold]that the procedure adopted by the respondent-Department is [in]contravention to the statute i.e. the Finance [Act, ][2021, ]at the [first]instance. Secondly, it is also in direct contravention to the directivesissued by the Hon'ble Supreme Court in the case of Ashish Agarwal,su Pra. 5This Court in the said order dated 14.09.2023 inW.P.No.259O3 of 2022, held as under: "35. [ln view of the ][aforesaid ][discussions, ][it ][is ][by ][now very clear that]the [procedure ]to be followed by the respondent-Department [upon]treating the notices issued for reassessment being under Section't48A, the subsequent proceedings was mandatorily required to beundertaken under the substituted [provisions ]as laid down under [the]Finance Act, 2021. ln the absence of which, we are constrained [to ][hold]that the procedure adopted by the respondent-Department is [in]contravention to the statute i.e. the Finance [Act, ][2021, ]at the [first]instance. Secondly, it is also in direct contravention to the directivesissued by the Hon'ble Supreme Court in the case of Ashish Agarwal,su Pra. 36. For all the aforesaid reasons, the impugned [notices issued ][and the]proceedings drawn by the respondent-Department is neither tenable,nor susteinable. The notices so issued and the [procedure ]adoptedbeing per se illegal, deserves to be and are accordingly [set]aside,/quashed. As a consequence, all the impugned orders [getting]quashed, the consequential orders passed by the resPondentDepartment [pursuant ]to the notices issued [under Section ][147 ][and ][148]would also get [quashed ]and it is ordered accordingly' [The reason ][we]are quashing the consequential order is on the [principles ]that [when]the initiation of the [proceedings ]itself was [procedurally wrong, ][the]subsequent orders also [gets ]nullified automatically.37. The [preliminary ]objection raised by the [petitioner is sustained ][and]all these writ [petitions ]stands allowed on this [very ][jurisdictional ][issue.]since the impugned notices and orders are [getting ][quashed ]on [the]point of jurisdiction, we are not inclined to Proceed further and decidethe other issues raised by the [petitioner ][which stands ][reserved ][to ][be]raised and contended in an appropriate [proceedings.]38. Since the Hon'ble Supreme Court had, in the [case ]of [Ashish]Agarwal, supra, as a one-time measure exercising the [powers under] I Article ['142 ]of the Constitution of lndia, [permitted ]the Revenue [to]proceed under the substituted provisions, and this Court allowing thepetitions only on the procedural flaw, the right conferred on theRevenue would remain reserved to [proceed ]further if they so wantfrom the stage of the order of the Supreme Court in the case of AshishAgarwal, supra.39. No order as to costs." 6. In view of the consensus arrived, the impugned ShowCause notices and consequential orders [passed ]in this batch ofwrit petitions are set aside. Liberty is reserved to both the partiesto take respective stand and to proceed in accordance with lawas per paragraph No.38 of the order dated 14.09.2023 inW.P.No.259O3 of 2022. 7The Writ Petitions are allowed. No costs. Interlocutoryapplications, if any pendinshal1 also stand ciosed.SD/-A.V.S,PADASSISTANT REGISR//TRUE COPY//I\SECTION OFFICERTo,1The lncome Tax Officer, [Ward ][- ][14(1), ] [Towers, ] [Guards, ][Masabtank']Hvderabad [- ]500004-ultionar 2iriiiiimt.t [riit. Faceless Assessment centre, lncome Taxffii;;i;;;i R""* [r'1. +or, z ][na ][rroot ][E Ramp, ][Jawaharlal ][Nehru Stadium']Delhi" 3. Deoutv Commissioner [of ][lncome Tax, Circle ]: ?(1) [q'n ][Floor'-signature]i#;;'= 6Jp e;""i;rr Gardens, Kondapur, Hvderabad - 500084'4.OneCC to Sri AV Raohu Ram. Advocate IOPUCI5.OneCC to Ms. [B]okaro Sapna Reddy [(Jr' ] [for ][lncome Tax)-]loPUCl6.OneCC to Ms. [J]-sunitna 'SC for ln6ome Tax Department[OPucl7.TwoCD CopiesTJGJP HIGH COURT DATED:0510912024ir-1t\ (JqCtot1 ti [N'U,l ][i;zi]4*f) s.-PA,1C.$[eq]COMMON ORDERWRIT PETITION [NOS. ][24361AND ][24380 OF 2024] ALLOWING WITHOUT lD\lt\ Lcxl