La No: 1 Of 2024 v. Raghu Ram

HIGH COURT FOR AT HYDERABAD(Special Original Jurisdiction) WEDNESDAY, THE TWENTY TWO THOUSAND AND PRESENT THE HONOURABLE SRI ANDTHE HONOURABLE [JUSTICE NAMAVARAPU RAJESHWAR ] WRIT PETITION NOS.23264 [23298 ][and][ 233330F ][2024] wRtT PETITION NO.23264 [0F ][2024] Between: Sri Tanqellapalli Mallikarjuna [Chary' S/o. Sri ][T. ][Bikshama ][Clary' ][Aged about]5S v"iti, Oi.rpation. [Piivate Service, ][1865 ][Brannon ][Heard Lane, Cumming']Georgia [- ]30041, USA. ...PETITIONER AND '1 . The Assistant Commissioner of lncome Tax, Circle - 9(1 ), l T' [Towers, ] [C']Guards, Masabtank. [Hyderabad ][- ][500004.]Guards, Masabtank. [Hyderabad ][- ][500004.] 2. Assessment Unit, [National Faceless Assessment Centre, lncome T-ax ]..- O"pirtr"nt, noom No.401 , 2nd Floor, E-Ramp' Jawaharlal Nehru Stadium'Delhi -1'10003.- O"pirtr"nt, noom No.401 , 2nd Floor, E-Ramp' Jawaharlal Nehru Stadium'Delhi -1'10003. 3. The lncome Tax [Officer, ][Ward ][- ][9(1), ][l.T. Towers, ][A.C' ][Guards, Masabtank']Hyderabad - 500004.Hyderabad - 500004. ...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 holding [that the ][notice ][dated ][26.O4.2022 ][issued ][by ][3'd ][Respondent]under section 148 of [the ][Act (with DIN and ][Notice ][No.ITBA/AST/S/148-112022']23t1042862109(l)) as [being ][without ]lurisdiction, [arbitrary, illegal, had ][in ][law, ][void]ab initio, apart from [being violative ][of ][provisions ][of ][section ]['148A ][and ][section ]['1 ][49]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] dated 26.04.2022 [and ][th€ ][assessment ][order ][passed ][by ][1't ][Respondent ][under]section ['147 ]r.w.s 144 [of the Act for ][asst ][yeat 2018-19'] 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 ][raised ][by ][1't ][Respondent ][and ][all ][consequential ][pending]penalty proceedinlts for the Ay.20'18-19. Counsel for the Petitioner: [SRI A. ][V. RAGHU ] Counsel for the Respondents: [MS.BOKARO SAPNA ] (Jr. SC FOR INCOME TAX) WRIT PETI[TION NO: ][23298 ] Between:Mr. Raheenr Uddin, [S/o. Mr. ][Hafeezuddin' Aged ][about ][71 years, Occ:,Retd']empbyee, 17-38-5i6/A, [Yakutpura, Chandranagar, ][Hyderabad - 500023'] ...PETITIONER ANO1Assessmenl Unit, [National Faceless ][Assessment ][C^gntre, ][lncome Tax]Deoartment Ministry [of ][Finance, Room ][No ][401 ],2"" [Floor. E-Ramp']Jawaharlal t,lehru Stadium, [Delhi ][- ][110 003.] 2The Assistant Commissioner [of ][lncome ][Tax, Circle - ][9(1)' ] [Towers, ][A'C']Guards, Ma:;abtank, [Hyderabad ][- ][500004.] ..RESPONDENTS Counsel for the Petitioner: [SRI A. ][V. RAGHU ] Counsel for the Respondents: [MS.BOKARO SAPNA ] (Jr. SC FOR INCOME TAX) WRIT PETI[TION NO: ][23298 ] Between:Mr. Raheenr Uddin, [S/o. Mr. ][Hafeezuddin' Aged ][about ][71 years, Occ:,Retd']empbyee, 17-38-5i6/A, [Yakutpura, Chandranagar, ][Hyderabad - 500023'] ...PETITIONER ANO1Assessmenl Unit, [National Faceless ][Assessment ][C^gntre, ][lncome Tax]Deoartment Ministry [of ][Finance, Room ][No ][401 ],2"" [Floor. E-Ramp']Jawaharlal t,lehru Stadium, [Delhi ][- ][110 003.] 2The Assistant Commissioner [of ][lncome ][Tax, Circle - ][9(1)' ] [Towers, ][A'C']Guards, Ma:;abtank, [Hyderabad ][- ][500004.] ..RESPONDENTS Petition unrler [Article 226 ][of ][the constitution ][of ][lndia ][praying ][that in ][the]circumstances st€tted [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 holdrng [that the ][notice ][dated ][08.04.2022 issued ][by 2n'r ][Respondent]under section 148, of the [Act ][(with DIN and ][Notice ][No.ITBA/AST/S/148_112022-]23t1042658004(11 )) as being [without ]iurisdiction, [arbitrary, illegal, bad ][in ][law, void]ab initio, apart frorn being, [violative ][of ][provisions ][of section ]['148A ][and ][section, ][149]of the Act and alt;o contrary [to the ][circular ][issued ][by ] [and ][provisions of]section 151A of the [Act, ][and consequently. set aside ][the ][notice under section ][148] dated 08.04.2O22 and the assessment order [passed ][by ]1't [Respondent ][under]section 147 r.w.s 144 r.w.s ['1448 ]of the [Act ][for ][asst. year 2015-16.] 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 staythe collection of tax and [penalty ]demands raised by ['1"r ]Respondent [for ][the]Ay.201 5-16. Counsel for the Petitioner: SRI A. V. RAGHU RAM Counsel forthe Respondents: MS. BOKARO SAPNA REDDY(Jr. SC FoR INCOME TAX) WRIT PETITION NO: 23333 OF 2024 Between: Mr. Naseeruddin Mohd, S/o. Mr. Mohd Hasnuddin, Aged [about ][53 ][years,]Occupation. Business, 3-1-231, Near Alankar Theatre, [Kakatiy ]a [Colony,]Hanamkonda, Warangal - 506001 [.] ...PETITIONER AND 1Assessment Unit, National Faceless Assessment Centre, lncome [Tax]Department, Ministry of Finance, Room No. [40'l ],2nd [Floor, E-Ramp,]Jawaharlal Nehru Stadium, Delhi [-1 ][10 ]003.Department, Ministry of Finance, Room No. [40'l ],2nd [Floor, E-Ramp,]Jawaharlal Nehru Stadium, Delhi [-1 ][10 ]003. 2The lncome Tax Officer, Ward [-1, ]lncome Tax Office, 1-8-610, [3'd ][Floor,]Mayuri Complex, Opp. TSNPDCL Bhawan, Nakkalagutta, [Hanamkonda,]Warangal - 506001.Mayuri Complex, Opp. TSNPDCL Bhawan, Nakkalagutta, [Hanamkonda,]Warangal - 506001. ...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 OFMANDAMUS holding that the notice dated 27t0412O22 [issued by 2nd Respondent]under section 148 of the Act [(with ]DIN and Notice No. 2311042869678(1)) as being without [jurisdiction, ]arbitrary, [illegal, bad ][in ][law, ][void]ab initio, apart [f ]rom being violative of [provisions ][of ][section ][148A and ][section ][149]of the Act and atso conlrary to [the circular ][issued ][by ] [and ][provisions of] section t51A of the Act. and consequently set aside the notice unCer section ['148]dated 27.04.2022 and the assessment order passed by 1't Respondent undersection ['147 ]r.w.s. 1448o{ the Act for asst. year 2018-'19 lA NO: 1 OF 2024 section t51A of the Act. and consequently set aside the notice unCer section ['148]dated 27.04.2022 and the assessment order passed by 1't Respondent undersection ['147 ]r.w.s. 1448o{ the Act for asst. year 2018-'19 lA NO: 1 OF 2024 Petition urrder Section 151 CPC praying lhat in the circumstances stated inthe affidavit filed in support of the petition, the High Court may be pleased to staythe collection o1' tax and penalty demand raised by ['1"r ]Respondent and thepending penalty proceed ings for the Ay.201 B-1 9 Counsel for the Petitioner: SRI A. V. RAGHU RAM Counsel for the Respondents: MS. BOKARO SAPNA REDDY (Jr. SC FOR INCoME TAx) The Court made the following: COMMON ORDER THE HONOURABLE [SRI .IUSTICE ] AND THE HONOURABLE tr,RJT PETITION [NOS.23264][ 2329a ][&23][333 ][0F ][2024] COMMON ORDER[ (per ][Hon'ble ][SP,J)] Sri A.V. Raghu [Ram, ][learned counsel, ][appears ][for ][the] and [Ms.B.Sapna Reddy, ][learned ][Junior ][Standing]petitioners Counsel for [Income ][Tax ][Department, ][appea-rs ][for ][the]respondents. Regard being being [[had ][to ][the ][similarity ][of ][the ][question]][[to ][the ][similarity ][of ][the ][question]][[the ][similarity ][of ][the ][question]][[similarity ][of ][the ][question]][[of ][the ][question]][[the ][question]][[question]] 2. Regard being being [[had ][to ][the ][similarity ][of ][the ][question]][[to ][the ][similarity ][of ][the ][question]][[the ][similarity ][of ][the ][question]][[similarity ][of ][the ][question]][[of ][the ][question]][[the ][question]][[question]]involved, on [the ][joint ][request ][of the ][parties, ][the ][matters ][are]analogously [heard and ][decided ][by ][this ][common order'] It is common is common common [[ground taken ]][[by ][the ][learned ][counsel ][for]][[the ][learned ][counsel ][for]][[learned ][counsel ][for]][[counsel ][for]][[for]] 3. It is common is common common [[ground taken ]][[by ][the ][learned ][counsel ][for]][[the ][learned ][counsel ][for]][[learned ][counsel ][for]][[counsel ][for]][[for]]the petitioner(s) [that ][in ][furtherance ][of ][Finance ][Act' ][2O2l' ][te-]assessment [process ][stood modified ][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 ][law, ][the ][consequential ][orders ][are ][also]bad in law. During the course course [[of ][hearing, learned cotlnsel ][for ][the]][[hearing, learned cotlnsel ][for ][the]][[for ][the]][[the]] 4. During the course course [[of ][hearing, learned cotlnsel ][for ][the]][[hearing, learned cotlnsel ][for ][the]][[for ][the]][[the]]that [curtains on ][this ][issue ][are ][finally ][drawn ][by]parties agreed this Court in [a ][batch ][of ][writ ][petitions, ][W'P'No'259O3 ][of ][2022]and other connected [matters, ][decided ][by ][common ][order ][dated] 14.O9.20:23. The parties agreed that this matter ma1, be disposed of in terrr.s of the Common Order dated 14.O9.2023 This Court in Court in in the said order dated 14.O9.2023 in 5This Court in Court in in W.P.No.215903 ol'2022, held as under: "35. ln view of the aforesaid discussions, it is by now very clear thatthe procedure to be followed by the respondent-Oepartment upontreating the notices issued for reassessment being under Section148A, the subsequent proceedings was mandatorily required to beundeftaken under the substituted provisions as laid down under theFinance Act, 2021. ln the absence of which, we are constrained to holdthat the procedure adopted by the respondent-Department is incontravention to the statute i.e. the Finance Act,2021, at the firstinstance. Secondly, it is also in direct contravention to the directivesissued by the Hon'ble Supreme Court in the case of Ashish Agarwal,su pra. This Court in Court in in the said order dated 14.O9.2023 in 5This Court in Court in in W.P.No.215903 ol'2022, held as under: "35. ln view of the aforesaid discussions, it is by now very clear thatthe procedure to be followed by the respondent-Oepartment upontreating the notices issued for reassessment being under Section148A, the subsequent proceedings was mandatorily required to beundeftaken under the substituted provisions as laid down under theFinance Act, 2021. ln the absence of which, we are constrained to holdthat the procedure adopted by the respondent-Department is incontravention to the statute i.e. the Finance Act,2021, at the firstinstance. 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 theproceedings drawn by the respondent-Department is neither tenable,nor sustainable. The notices so issued and the procedure adoptedbeing per se illegal, deserves to be and are accordingly setaside,'quashed. As a consequence, all the impugned orders gettingquashed, the consequential orders passed by the respondentOepartment pursuant to the notices issued under Section 147 and 148would also get quashed and it is ordered accordingly. The reason weare quashing lhe consequential order is on the principles that whenthe initiation of the proceedings itself was procedurally wrong, thesubsequent orders also gets nullified automatically.37. The preliminary obiection raised by the petitioner is sustained andall these writ petitions stands allowed on this very jurisdictional issue.Since the impugned notices and orders are getting quashed on thepoint of jurisdiction, we are not inclined to proceed further and decidethe olher issues raised by the petitioner which stands reserved to beraised and contended in an appropriate proceedings.38. Since the Hon'ble Supreme Cou( had, in the case of AshishAgan/al, supra, as a one-time measure exercising the powers underArticle 142 of the Constitution of lndia, permitted the Revenue toproceed 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 want 3from the stage of the order of the Supreme Court in the case of AshishAgarwal, supra. 39. No order as to costs." In view of the consensus arrived, the impugned Show 6 Cause 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.25903 of 2022. 7The Writ Petitions are allowed. No costs. Interlocutoryapplications, if any pending, shall also stand closed.Sd/. N. SRIHARIASSISTANT\EJiTSTRAR//TRUE coPY// sEcrldN oFFtcER To,1.TheAssistantCommissioneroflncomeTax,Circle-9(1),l.T.Towers'A.C.Guards, Masabtank. [Hyderabad - 500004']1.TheAssistantCommissioneroflncomeTax,Circle-9(1),l.T.Towers'A.C.Guards, Masabtank. [Hyderabad - 500004']2.i# r{;";;,#i [unit, irrationit ][Faceless Assessment Centre' ] [ncome ]-Tax#;;;ft;i R;;m r.rt.+or, [ihd Floor, E-Ramp, Jawaharlal Nehru Stadium']Delhi -110003.#;;;ft;i R;;m r.rt.+or, [ihd Floor, E-Ramp, Jawaharlal Nehru Stadium']Delhi -110003.3.i#'i".,;;; T; [officer, ][ward ][- ][9(1), ] [T. ][Towers' ][A'c ][Guards' ][Masabtank']Hvderabad [- ]500004.Hvderabad [- ]500004.4.oil"-Cb io Sri A. [V. ][Raghu ][Ram, ][Advocate ][ ]65;; cd i6 nri. [iioturo ][Sapni ][n6oov ][(Jr' ] [for ][lncbme ][Tax) ][[oPUc]]b.Two CD CoPies65;; cd i6 nri. [iioturo ][Sapni ][n6oov ][(Jr' ] [for ][lncbme ][Tax) ][[oPUc]]b.Two CD CoPiesTJMP sMP s HIGH COURT ::'._---':---,,\-i';1F.._-\,,. J,rll--^r\-' a)'\':.:. ,\7A\lj:t E lt] tt\t\i'ii\\ 'i\l\' iI\:.\ DATED:2810812024 ORDER WRIT PETITION [NOS' 23264,23298 ][and ][23333 ] 2024 ALLOWING WITHOUT @c+qq\n- II