Of Finance Act, 2021 W.e.f., 01.04.2021 Onwards, Proceedingsunder Section L48A Ofthe Act As Also Under Section 148 Oftheact Ought To Have Also Been Issued And P v. Income-Tax Officert Decidedon 14.09.2023 Whereby A Batch Of Writ Petitions Were Allowed Andthe Proceedings Initiated Under Section 148A As Also Under

HIGH COURT FOR THE STATE AT HYDERABAD(Special Original Jurisdiction) FRIDAY, THE SECOND DAY OF TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICF [P.SAM KOSHY]AND THE HONOURABLE SRI JUSTICE wRtT PETITION NO: 26939 OF 2024 Between: Hartex Rubber Private Limited, [Haying ][its ][registered ][office ][at ][8- ][2- ][472' ][Road ][1,]Banjara Hills, GVC Square,4th [Floo'r, ][Hyderabad, Telangana ][- ][500034 Represented]by its Authorised Signatory [Mr. Amit ][Jain.] .....PETITIONER AND 1. Union of lndia, IVlinistry of Finance, [North Block, New Delhi Represented ][by ][its]Secretary.Secretary. 2. Principal Chief Commissioner of [lncome ][Tax, ][Aayakar Bhavan, Basheerbagh,]Hyderabad - 500004.Hyderabad - 500004. 3. Deputy Commissioner [of lncome Tax, Circle ][2('l ]), [Room No. ][514, SthFloor']Sijnature Towers, Sy.No.6(P) of [Kondapur, ][Sy.3(P)of ][Kothagud4 ][Opp.]Boitanical Gardens, Serlingampally [(M), ][R. ][R.District, ][Hyderabad - ][Telangana]- [500084.]tSijnature Towers, Sy.No.6(P) of [Kondapur, ][Sy.3(P)of ][Kothagud4 ][Opp.]Boitanical Gardens, Serlingampally [(M), ][R. ][R.District, ][Hyderabad - ][Telangana]- [500084.]t .....RESPONOENTS 'Petition Under Article 226 of lhe Constitution of lndia praying that in thecircumstances stated in the [affidavit ][filed ][therewith, ][the ][High ][Court ][may ][be]pleased to issue an appropriate writ, order, direction [more particularly ][one in ][the]nature of a Writ of [Mandamus declaring ][the ][Notice ][dated ][16.08.2024 issued ][by]the Respondent [No. ][3 ][under ][Section ][148A(b) ][of the ][lncome ][Tax Act, ][1961 (Act)']Order dated 29.O8.2O24 [passed ][by ][Respondent ][No.3 ][under ][Section ][1a8A(d) ][of]the Act, Notice dated 29.08.2024 [issued by ][the ][Respondent No. ][3 ][under ][Section]148 of the Act and all the [consequential ][proceedings ][as ][illegal, arbitrary ][and]contrary to the [provisions ][of the lncome Tax Act, ][1961.] |.A.NO:1 OE 2024 Petition Under Section 151 cpc praying that in the crrcumstances stated inthe affidavit filed in support of the petition, the High cou.t may be pleased to staythe operation of the Notice dated i6.09.2024 issued by the Respondent No. 3under Section 148A(b) of the lncome Tax Act, 1961 (Act), Order dated29.o8.2024 passed by Respondent No.3 under Section 14sA(d) of the Act, Noticedated 29.08.2024 issued by the Respondent No.3 under section 148 of the Actand all the consequential proceedings pending the consideration of this writPetition by this Hon'ble Court, in the interests of justice and equity. Counsel for the Petitioner : SRI V.ANEESH counsel for the Respondent No.1 : sRr B.MUKHERJEE, LEARNED couNsELREPRESENTING THE UNION OF ]NDIAREPRESENTING THE UNION OF ]NDIA counsel for the Respondent Nos.2 & 3 : Ms J.suNrrHA, LEARNED JUNTORSTANDING COUNSEL FOR THE INCOME TAX DEPARTMENT The Court made the following ORDER THE HONOURABLE [P.SAM ] ANDTHE HONOURABLE NANDIKONDA WRIT PETITION [No.26][939 ][0F ][2024] ORDER, [(per ][Hon'ble ][Sri ][Justice ][P'Sam ][Koshy)] Heard Mr. [V.Aneesh, ][leamed counsel ][for ][the ][petitioner'] Mr. [B. ][Mukherjee, ][learned counsgl representing the ][Union ][of ][India]for [respondent ][No.1 ][and ][J.Sunitha, leamed ][Junior ][Standing]Counsel [for ][the ][lncome ][Tax ][Department ][for ][respondent Nos'2]and [3. Perused the ][record.] 2. This is a writ [petition ][where ][the ][proceedings. ][are ][either]challenged [to ][the notices ][which ][were ][issued ][under Section ][l48A]and [148 ][of ][the Income ][Tax ][Act, ][1961 ][(for ][short ]['the ][Act') ][or ][the]assessment [orders ][those have ][been passed ][under ][Section ][147 ][of]thq [Act ][which ][have been assailed'] WRIT PETITION [No.26][939 ][0F ][2024] ORDER, [(per ][Hon'ble ][Sri ][Justice ][P'Sam ][Koshy)] Heard Mr. [V.Aneesh, ][leamed counsel ][for ][the ][petitioner'] Mr. [B. ][Mukherjee, ][learned counsgl representing the ][Union ][of ][India]for [respondent ][No.1 ][and ][J.Sunitha, leamed ][Junior ][Standing]Counsel [for ][the ][lncome ][Tax ][Department ][for ][respondent Nos'2]and [3. Perused the ][record.] 2. This is a writ [petition ][where ][the ][proceedings. ][are ][either]challenged [to ][the notices ][which ][were ][issued ][under Section ][l48A]and [148 ][of ][the Income ][Tax ][Act, ][1961 ][(for ][short ]['the ][Act') ][or ][the]assessment [orders ][those have ][been passed ][under ][Section ][147 ][of]thq [Act ][which ][have been assailed'] 7. This writ [petition ][is being taken ][up ][today ][only ][on one ][of ][the]grounds, [that the ][notices ][issued ][under Section 148A ][of ][the ][Act]and [the ][subsequent ][initiation ][of ][proceedings under ][Section ][148 ][of]the Act [by ][the ][jurisdictional ][Assessing ][Officer' ][whereas ][in ][terms]of the [amendment ][that ][was ][brought ][to ][the Income ][Tax ][Act ][by way] of Finance Act, 2021 w.e.f., 01.04.2021 onwards, proceedingsunder Section l48A ofthe Act as also under Section 148 oftheAct ought to have also been issued and proceeded in a facelessmanner. 4. The contention contention of the petition'er is that the issue ofthe petition'er is that the issue ofpetition'er is that the issue ofis that the issue ofthat the issue ofthe issue ofissue ofofproceedings being in violation of the Finance Act,2OZl i.e., theimpugned notices under Section t48A and Section 148 ofthe Actnot being issued in a faceless manner, have already been dealt withand decided by this Court in the case of KANKANALARAVINDRA REDDY vs. INCOME-TAX OFFICERT decidedon 14.09.2023 whereby a batch of writ petitions were allowed andthe proceedings initiated under Section 148A as also under Section148 of the Act were held to be bad with consequential reliefs on theground of it being in violation of the provisions of Section 15 I A oftle Act read with Notification l8l2\22 dated2}.O3.ZO22. The saidjudgment passed by this Court has also been subsequently followedin a large number of writ petitions which were allorved on similarterms. The contention contention of the petition'er is that the issue ofthe petition'er is that the issue ofpetition'er is that the issue ofis that the issue ofthat the issue ofthe issue ofissue ofof ' [(2023) 56 taxmann.com 178 (Telangana)] .l Down the [[line, ][we ][find ][that the ][same ]][[we ][find ][that the ][same ]][[find ][that the ][same ]][[that the ][same ]][[same ]][[issue has also ]][[been]] 5- Down the [[line, ][we ][find ][that the ][same ]][[we ][find ][that the ][same ]][[find ][that the ][same ]][[that the ][same ]][[same ]][[issue has also ]][[been]]decided against [the ][Revenue ][by ][various ][High ][Courts ][i'e'']by the Bombay [High ][Court ][in ][the ][case ][of ] TECHNOLOGIES [LTD., ][VS. ] OF INCOME [& ][OTHERS2, ][Gauhati ][High ][Court in ][the ][case]of RAM NARAYAN [SAH vs' ] [INDIA3' ][Punjab ][and]Haryana [High ][Court ][in ][the ][case ][of ] vs. tiNION [OF INDIA4, ][and Telangana ][High Court ][in ][the ][case ][of]SRI VENKATARAMANA [VS. ] COMMISSIONER [where the ][issue ][was ][in]of [intemational |axation, Bombay ][High ][Court ][in ][the ][case ][of]respect ABHIN ANILKUMAR [SHAH VS.INCOME ] [OFFICER,]INTERNATIONAL [which ][is ][again on ][intemational]taxation [and ][central ][circle, High ][Court ][of ][Himachal ][Pradesh ][in ][the]case of GOVIND [vs' ] [OFFICERT']Guiarat [High ][Court ][in ][the ][case ][of ] t- 'lzozl)464 [430 ][(Bom)]' [1zOZ+1 [56 ][taxmann.com 478 ][(Gauhati)]]'tizozqi [165 ][taxmann.com ][115 ][(Punjab ][& ][Haryana)l]' 12024) [167 ][taxmann'com ][4l ] [(Telangana)l]" 12024) [166 ][taxmann.com 679 ][(Bombay)l ]^'iZOZqj [165 ][taxmann-com ] [l3 ][(Himachal ][Pradesh)l] DAHYABI{AI RADADIYA vs. TNCOME TAX OFFICE&WARD 3(3X5)8, Jharkand High Court in the case of SIIYAMSUNDAR SAW vs. UNION OF INDIAe, Rajasthan High Court inthe case of SHARDA DEVI CHHAJER vs. INCOME TAXOFFICER & ANOTHER and batch of writ petitionsro whichstood decided on 19.03.2024. Similar views have also been takenby the Division Bench of Calcutta High Court in the case ofGIRDHAR GOPAL DALMIA vs. UNION OF INDIA & ORS(M.A.T 1690 of 2023), decided on25.09.2024.6. Even though the sarde issue having been decided by a largenumber of tligh CourtS, we are still confionted with large filing ofidenticai matters on Caily basis ranging between 5 to 10 writpetitions. That upon the instructions being sought from theDepartment, they have been taking a solitary ground that thedecision of the Bombay High Court in the case of Hexaware\echnologies [Ltd., ][(2 ][supra) ][as ][also ][the ][one ][which ][has ][been]decided by this Court in the case of Kanakala Ravindra Reddy Ezozl scc ont-ine Guj 4012'2025 SCC OnLine lhar 287'012023 [: ] [:4984-DBl] (1 supra) [has been subjected ][to ][challenge ][in ][a ][Special ][Leave]Petition [i.e., ][SLP No.3574 ][of ][2024 ][before the ][Hon'ble ][Supreme]Court [and ][the Hon'ble ][Supreme ][Court ][is ][seized ][of ][the ][matter']In addition, [there ][are ][about ][1200 SLPs ][also ][fited ][arising out ][ofthe]same issue [being ][decided ][by ][various High Courts'] 7. To a query [being ][put to ][the learned counsel ][for ][the Revenue']have [categorically ][accepted ][the ][fact that there ][is ][no ][interim]they order [granted ][by ][the ][Hon'ble ][Sup'eme ][Court ][in ][any ][of ][these]matters [pending ][before ][it' ][Meanwhile' fresh ][writ ][petitions ][of]identicat [nature ][are ][being piled ][up ][beflore ][this ][Bench on ][daily ][basis]and the [pendency ][is ][gptting ][increased ][on ][matter ][which ][otherwise]has already [been ][dealt ][and ][decided by ][this very ][High ][Court ][itself']8. On the [one hand, even though ][the order ][of ][this ][Court ][that]was passed [as ][early ][as ][on ][14'09'2023 and ][more ][16 months ][have]till [date, ][we do not ][find ][any remedial ][steps ][having ][been]lapsed, taken by [the Income ][Tax ][Department ][to ][take appropriate ][steps ][to]either hold [back ][issuance ][of ][notice under Section ][l48A ][and under]Section [148 ][of ][the ][Act by ][the ][jurisdictional ][Assessing ][Officer']rather the [authorities ][concemed ][in ][the teeth ][of ][series ][of ][decisions] '- --f,ti,, [. ] '- --f,ti,, [. ] by all the major High Courts in India are continuously stillinitiating proceedings under Section 1484. of the Act and alsoinitiating proceedings under Section 148 of the Act incontravention to the amendments brought into the Income Tax Actpursuant to the Finance Act,2020 as also the Finance Act 2021.9. Upon a query being put as to why can't this writ petition bedisposed of in the teeth of the.decision rendered by this Court ininitiating proceedings under Section 1484. of the Act and alsoinitiating proceedings under Section 148 of the Act incontravention to the amendments brought into the Income Tax Actpursuant to the Finance Act,2020 as also the Finance Act 2021.9. Upon a query being put as to why can't this writ petition bedisposed of in the teeth of the.decision rendered by this Court inthe case of Kanakala Ruvindra Reddy (l supra), leamed StandingCounsel for the Income Tax Department contends that those wouldCounsel for the Income Tax Department contends that those wouldunnecessarily burden the Income Tax Department where theywould be required to file equal number of SLps before theHon'ble Supreme Court and it would be further burdening theexchequer of the Union of India. It was also the contention of theleamed Standing Counsel that no prejudice would be caused to theinterest of the petitioners in case if this writ petition is kept pendingtih tne finalization of the SLps pending before the Hon,blewould be required to file equal number of SLps before theHon'ble Supreme Court and it would be further burdening theexchequer of the Union of India. It was also the contention of theleamed Standing Counsel that no prejudice would be caused to theinterest of the petitioners in case if this writ petition is kept pendingtih tne finalization of the SLps pending before the Hon,ble,Supreme Court and the fact thar the petitioner is already enjoyingthe benefit of interim protection. Nonetheless, on the earlier queryof this Court as to why the Income Tax Department have not comeout with a mechanism to issue appropriate instructions or to takethe benefit of interim protection. Nonetheless, on the earlier queryof this Court as to why the Income Tax Department have not comeout with a mechanism to issue appropriate instructions or to take appropriate steps in ensuring that proceedings under Section l48Aof the Act as also the assessment orders under Section 148 of theAct are kept in a hold in the light ofthe decisions dedcided by thevarious High Courts, it was submitted by the leamed StandingCounsel that the said steps can only be taken at the level of CBDTas any such steps would have to be taken Pan India and cannot belimited to any of these [jurisdictional ]High Courts. 10. As a result of which, what we are facing is steep increase oflitigation day in and day out even though various orders have beenpassed by this High Court allowing writ petitions on the very sameissue. The Income Tax authorities concerned are still even now in2025 also initiating proceedings in contravention to the provisionsof Section I 5 I A of the Act and as a result by now, more than 600to 700 petitions have been already got piled up before this HighCohrt on an issue which otherwise stands squarely covered by thejndgment of this Court in the case of Kanakala Ravindra Reddy(l supra). What is also surprising is the fact that though whileallowing the writ petitions in the case of Kanakala RavindraReddy (1 supra), the Division Bench while reserving the right ofthe Revenue, has also protected the interest of the petitioners insofar as the [liberty which ][was ][granted ][to ][the ][R'evenue ][fci]fresh [proceedings ][strictly ][in ][accordance ][with ][the ][amended]initiating of [the ][Act, ][as amended ][by ][the Finance ][Act' ][2020 ][and]provisions the Finance [Act,2O2l. ][The ][petitioner ][assessee ][would ][be ][entitled ][to]or [raise ][the ][other ][legal objections ][if ][the Revenue ][initiates]challenge fresh proceeclings. [The ][Department ][has ][made ][no ][endeavour in]the [said ][liberty ][that ][was reserved ][for the ][Revenue ][On ][the]availing contrary, they [have ][been ][still ][sticking on ][to ][the ][stand, ][which ][this]Court [as ][well ][as ][many other ][High ][Courts ][already ][held ][to ][be]High bad. 1 1. It appears [that ][because ][of ][the aforesaid ][liberty ][that this ][High]Court had [granted ][permitting ][the ][Revenue ][for ][initiating ][fresh]as a [one-time ][measure ][in ][a ][faceless ][manner' ][the]proceedings Income Tax [Department wants ][to ][take ][advantage ][of ][the ][same ][by]these [proceedings ][which would ][enable ][them to ][meet the]protracting hmitation that [would ][otherwise ][come ][in ][the ][way' ][Likewise' ][if ][the]writ petition [is ][kept pending ][for ][a ][considerable ][long period ][of ][time]and finally at [a later ][stage ][if ][the ][Hon'ble ][Supreme ][Court ][confirms]the decision taken by [this ][High Court ][as ][also ][by ][the ][other ][High]Courts in rvhicn the [SLPs are ][stil! ][pending, ][the ][Income ][Tax] -'--1 ;l Department,would get the advantage of the liberty that is otherwiseprotectedln favour of the Revenue for initiation of freshproceedings from the disposal of these matters at a much later stagewhich would be advantageous and beneficial to the Revenue andwould be equatly disadvantageous and detrimental so far as interestof the assesses are concemed. As a consequence, the Income TaxDepartment gets an extended period of time for initiation of I]eshproceedings. 12. The alarming trend of docket explosion in this Court, despitethe clear precedent setin Kanakala Ravindra Reddy (l supra), is amatter of grave concem. The Income Tax Departmentrs persistentinitiation of fresh proceedings, disregarding the established [judicial]pronouncements, has led to an unprecedented surge in litigationwith over 600-700 petitions piling up on the same issue. Thisdehberate approach not only undermines the principle ofjudicialprecedent but also strains the [judicial ]resources unnecessarily. TheDepartment's strategy of awaiting the Supreme Court's decision onpending SLPs while continuing to initiate fresh proceedingsappears to be a calculated move to buy time and circumventlimitation periods, rather than adhering to the established legal position. Such conduct raises serious questions about theadministrative efficiency and the respect for judicialpronouncements, particularly when this Court has already provideda balanced approach by preserving both the Revenue,s rights andassesses interests. 13' Another aspect which needs to be considered is that in fact it position. Such conduct raises serious questions about theadministrative efficiency and the respect for judicialpronouncements, particularly when this Court has already provideda balanced approach by preserving both the Revenue,s rights andassesses interests. 13' Another aspect which needs to be considered is that in fact it should have been realized by the Income Tax Department itself andshould have found out via media in ensuring that proceedingsunder Sections 148-4 and l4g should not have been issued in afaceless manner, at least till.the Hon,ble Supreme Court decide thetwelve hundred (1200) odd SLps which it is already seized ofor, attwelve hundred (1200) odd SLps which it is already seized ofor, atleast the Income Tax Department should have found out someremedial steps to ensure that wherever the authonties intend toinitiate proceedings under Sections l4g_A and l4g, other than in aremedial steps to ensure that wherever the authonties intend toinitiate proceedings under Sections l4g_A and l4g, other than in afaceless manner, the proceedings should have been deferredwithout precipitating the matter further intimating the assessee thatIthey shall initiate appropriate proceedings only after rhe SLp,s arewithout precipitating the matter further intimating the assessee thatIthey shall initiate appropriate proceedings only after rhe SLp,s aredecided by the Hon'ble Supreme Court on the very same issue.This This again, the Income Tax Department, has not been able to give aconvlnctreply, except for the fact that such a decision if at all ..t has to be taken, has to be taken [for ][the ][whole ][of ][India, ][and ][which]otherwise has to be by [way ][of ][a ][policy ][decision and that ][too ][at ][the]level of Central Board of [Direct ][Taxes. ][Though ][the ][leamed]Standing Counsel [for ][the ][Income ][Tax ][Department ][contended ][that]the Delhi High Court dismissed [a ][writ ][petitibn ][of similar ][nature, ][on]the one hand [when ][the High ][Court ][is ][struggling ][to ][reduce ][its]pendency, such notices which are [under challenge ][in ][this ][writ]petition are forcing the assessee to [knock ][the ][doors ][of ][this ][High]Court resulting [in ][filing ][of ][hundreds ][of new ][writ ][petitions ][which in]the long run not only [affects the ][disposal ][of ][the ][writ ][petitions but]also consumes substantial time [of ][the ][Bench ][in ][hearing ][these]matters again and again on [daily basis. Admittedly, ][in ][spite ][of ][the]matter before the [Hon'ble ][Supreme ][Court having ][been taken ][on]many occasions, the [Hon'ble ][Supreme ][Court ][which ][is ][seized ][of ][the]matter has been reluctant [in ][granting any ][interim ][protection ][to ][the]lncome Tax Department. [Yet, ][the ][authorities ][concerned ][at ][the]State level are not [ready ][to ][accept ][the verdict ][passed ][by ][a ][maj ][ority]of High Courts of different [States ][on the ][same ][issue; and ][to ][make]things further worse, [the ][Income ][Tax ][Department ][is ][showing]audacity by issuing [notices ][continuously ][under Sections ][148-A ][and]/ 148 through the [jurisdictional ]Assessing Officer whereas it oughtto have been only in the faceless manner. 14. In the case of BANK OF INDIA vs. ASSISTANTCOMMISSIONER, INCOME TAXIT, on an issue whether it wasjustifiable on the part of the Income Tax Department in notfollowing an order passed by the adjudicating authority only on theground that the appeals ard pending, the Division Bench of theHigh Court of Bombay held at paragraph No.25 as under, viz., : 148 through the [jurisdictional ]Assessing Officer whereas it oughtto have been only in the faceless manner. 14. In the case of BANK OF INDIA vs. ASSISTANTCOMMISSIONER, INCOME TAXIT, on an issue whether it wasjustifiable on the part of the Income Tax Department in notfollowing an order passed by the adjudicating authority only on theground that the appeals ard pending, the Division Bench of theHigh Court of Bombay held at paragraph No.25 as under, viz., : "25. Mr. Paridwalla.,has rightly drawn out attention to thedecision of this Court in Commissioner of lncome Tax vs. Smt.Godavaridevi Sardf'2 as also the recent decision of the co-ordinate Bench of this Cou( in Samp Furniture (P) Ltd. v. ITO'3of which one of us (Justice G.S. Kulkarni) was a member, whereinthe Court categorically observed that the Revenue having not"accepted" the judgment of the High Cou( would not mean that tillthe same is set aside in a manner known to law, it would loose itsbinding force. Referring to the decision of the Supreme Court inUnion of India vs. Kamlakshi Finance Corporation Ltd.'4, theCou( observed that the approach of the officials of Revenue of1treating decisions being "not acceptable' was criticized by theSupreme Court. ln such decision, following are the relevantobservations made by the Supreme Court. " 11202s.1 [170 ][taxmann.com ][422 ][(Bombay)l] '" lt978l I l3 ITR 589 (Bombay)t3 120211165 taxmann.com 581/300 Taxman 452 (Bombay) 'o 1l9921taxmann.com [16i55 ] [433 (SC)] \ t " 11202s.1 [170 ][taxmann.com ][422 ][(Bombay)l] '" lt978l I l3 ITR 589 (Bombay)t3 120211165 taxmann.com 581/300 Taxman 452 (Bombay) 'o 1l9921taxmann.com [16i55 ] [433 (SC)] \ t "6. Sri Reddy is perhaps right in saying that theofficers were not actuated [by ][any ][mala ][fides ][in]passing the impugned orders. They [perhaps]officers were not actuated [by ][any ][mala ][fides ][in]passing the impugned orders. They [perhaps]genuinely felt that the claim of the assessee was nottenable and that, if it was accepted, [the ][Revenue]would suffer. But what Sri Reddy [overlooks ][is ][that we]are not concerned here with the [correctness ][or]otherwise of their conclusion or of [any ][factual]malafides but with the [fact that ][the ][officers, in reaching]in their conclusion, by-passed [two ][appellate orders ][in]regard to the same is$le which [were ][placed ][before]them, one of the Collector [(Appeals) ][and ][the other of]the Tribunal. The High Court [has, ][in ][our view, rightly]criticized this conduct of the [Assistant ][Collectors ][and]the harassment to,the assessee [caused by the failure]of these officers to [give ]effect to [the ][orders ][of]authorities higher to them [in the appellate ][hierarchy. ][lt]cannot be too vehemently [emphasized ][that ][it ][is ][of]utmost importance that, in [disposing ][of. ][the]quasijudicial issues before them, revenue officers [are]bound by the decisions of the [appellate ][authorities.]The order of the Appellte Collector [is ][binding ][on ][the]Assistant Collectors [working within his ]iurisdiction [and]the order of the Tribunal [is ][binding upon ][the ][Assistant]Collectors and the Appellate [Collectors ][who ][function]under the [jurisdiction of ][the ][Tribunal. ][The principles of]judicial discipline require that the orders of the higherappellate authorities should [be followed ][unreservedly]by the subordinate authorities. [The ][mere fact that the]order of the appellate authority [is ][not ]["acceptable" ][to]-the department - in itself an [objectionable phrase ]and is the subject matter of [an appeal can furnish ][no]ground for not following it unless its operation [has]been [s(spended ][by a competent ][court. ][lf ][this healthy]A\tenable and that, if it was accepted, [the ][Revenue]would suffer. But what Sri Reddy [overlooks ][is ][that we]are not concerned here with the [correctness ][or]otherwise of their conclusion or of [any ][factual]malafides but with the [fact that ][the ][officers, in reaching]in their conclusion, by-passed [two ][appellate orders ][in]regard to the same is$le which [were ][placed ][before]them, one of the Collector [(Appeals) ][and ][the other of]the Tribunal. The High Court [has, ][in ][our view, rightly]criticized this conduct of the [Assistant ][Collectors ][and]the harassment to,the assessee [caused by the failure]of these officers to [give ]effect to [the ][orders ][of]authorities higher to them [in the appellate ][hierarchy. ][lt]cannot be too vehemently [emphasized ][that ][it ][is ][of]utmost importance that, in [disposing ][of. ][the]quasijudicial issues before them, revenue officers [are]bound by the decisions of the [appellate ][authorities.]The order of the Appellte Collector [is ][binding ][on ][the]Assistant Collectors [working within his ]iurisdiction [and]the order of the Tribunal [is ][binding upon ][the ][Assistant]Collectors and the Appellate [Collectors ][who ][function]under the [jurisdiction of ][the ][Tribunal. ][The principles of]judicial discipline require that the orders of the higherappellate authorities should [be followed ][unreservedly]by the subordinate authorities. [The ][mere fact that the]order of the appellate authority [is ][not ]["acceptable" ][to]-the department - in itself an [objectionable phrase ]and is the subject matter of [an appeal can furnish ][no]ground for not following it unless its operation [has]been [s(spended ][by a competent ][court. ][lf ][this healthy]A\ rule is not followed, the result will only be undueharassment to assesses and chaos in adminislrahonof tax laws. rule is not followed, the result will only be undueharassment to assesses and chaos in adminislrahonof tax laws. 12. We have dealt with this aspect at some length,because it has been suggested by the learnedAdditional Solicitor General that the observatronsmade by the High Court, have been harsh on theofficers. lt is clear that the observations of the HighCourl, seemingly vehement, and apparentlyunpalatable to the Revehue, are only intended to curba tendency in revenue matters which, if allowed tobecome widespread, could result in considerableharassment to the assesses-public without any benefitto the Revenue..,.We would like to say that thedepartment should take these observations n theproper spirit. 'The observations of the High Courtshould be kept in mind in future and the utmost regardshould be paid by the adjudicating authorities and theappellale authorities to the requirements of judicialdiscipline and the need for giving effect to the ordersof the higher appellate authorities which are bindingon them." 15. What is worrying this Bench more is the fact that antendeavour is being made whole heartedly to ensure not to generatefurther litigation on issues which have been laid to rest by a largenumber of High Courts all of whom have taken a consistent standthat the action of the Income Tax Department being violative of the Finance Act,2020 and Finance Act,202l. Now, in order to protectthe interest of the Revenue as also that of the assessee, it would betrite at this [juncture, ]if we dispose of the writ petition with anobservation/direction that the disposal of the instant writ petition interms of the [judgment ]rendered by this High Court in the case ofKankanala Ravindra Reddy (l supra) shall however be subject tothe outcome of the SLPs which were filed by the Income TaxDepartment and which is pending consideration before the Hon'bleSupreme Court. 16. In the given facts and circumstances, this Bench is of the considered opinion that unless and until we do not timely disposeof matters which are squarely covered by the decision of this Courtand which stands fortified by the decisions of the various otherHigh Courts on the very same issue, the pendency of this HighQourt [would ][further ][be ][burdened ][which ][otherwise ][can ][be ][decided]and disposed of as a covered matter. 17. So far as the interest of the Revenue is concerned, we are of the considered opinion that the interest of the Revenue has alreadybeen considered and protected, as has been observed in paragraphs I I I 1 36, 37 ano 36 of the order which, for ready reierence, is reprodujcdreprodujcd hereunder: 36. For all the aforesaid reiss ued a nd *,u p,o.""oins"" :HiTJTJi::il:::":Department is neithernor sustainabreThe notices so issued "no [,t"nuo'u' ]perseillegal,deservesroheProcedureadoptedbeingand are accordingly setaside/quashed. oa , aona,9" all the impugnedorders getting guashed, ,n" ,'o'"n""' by the responde",rr"r"nr"litffi ,""-;l ffi:::issued under Section 147and 148 would also getquashed and it is ordered a are quashins,n" .onr"or"n,,li:::1l JTJffi ::that when the. initiation of the proceedings itself wasprocedurally wrong, the subsequent orders also getsnuflified aulomaticafly. 37. The preliminary objection raised by the petitioner issustained and all these writ petitions stands allowed onthis very jurisdictional issue. Since the impugned noticesand orders are getting quashed on the point ofjurisdiction, we are not inclinec, to proceed further anddecide the other issues raised by the petitioner which'appropriate proceedings.stands reserved to be raised and contended in an 38 Since the Hon,ble Supreme Court had, inthe caseof Ashish Agarwal, supra, as a one_timemeasureexercising the powers under Article 142of theConstitution of lndia, permitted the Revenue toproceedunder the substituted provisions, and this Court allowingthe petitions only on theprocedural flaw, the right 37. The preliminary objection raised by the petitioner issustained and all these writ petitions stands allowed onthis very jurisdictional issue. Since the impugned noticesand orders are getting quashed on the point ofjurisdiction, we are not inclinec, to proceed further anddecide the other issues raised by the petitioner which'appropriate proceedings.stands reserved to be raised and contended in an 38 Since the Hon,ble Supreme Court had, inthe caseof Ashish Agarwal, supra, as a one_timemeasureexercising the powers under Article 142of theConstitution of lndia, permitted the Revenue toproceedunder the substituted provisions, and this Court allowingthe petitions only on theprocedural flaw, the right confened on [the ][Revenue ][would ][remain ][reserved ][to]proc€ed further if they [so want from ][the ][stage ][of ][the]order of the [Supreme ][Courl ][in ][the ][case ][of ][Ashish]Agarwal, [suPra.] 18. We [would ][only ][further ][like to ][make observations ][that ][since]we are inclined [to ][dispose ][of ][the instant ][writ ][petition, ][conscious ][of]the fact [that the ][earlier order ][of ][this High ][Court ][in ][the ][case ][of]Kanakala [Ravindra Reddy ][(l ][supra) ][is ][subjected ][to ][chatlenge]before the [Hon'ble ][Supreme ][Court ][in ] [No'3574 ][of ][2024,]preferred [by ][the ][Income ][Tqx Department' we ][make ][it ][clear ][that]of [the ][instant;writ petition ][is ][subject ][to ][outcome ][of ][the]allowing aforesaid [preferred ][by the ][Revenue against ][the ][decision ][of ][this]Court [in ][the ][case ][of ][Kanakala Ravindra ][Reddy ][(l ][supra)']High This, in other [words, ][would ][mean ][that either ][of ][the ][parties, ][if ][they]so want, [may move ][an ][appropriate ][petition ][seeking ][revival ][of ][this]writ oetition [in ][the ][light ][of ][the decision ][of ][the ][Hon'ble ][Supreme]ICourt in [the pending SLP on ][the ][very ][same issue'] 19. Accordingly, [the ][instant ][writ ][petition ][stands ][allowed ][in]favour of [the ][assessee ][so far ][as the ][issue ][of ][jurisdiction]lsconcemed. [As ][a ][consequence, ][the ][impugned ][notice ][under]challenge [under Sections 148-,{ ][and ][148 ][stands set aside/quashed] The consequential orders, if any, also stand set aside/quashed in similar terms as have been passed by this High Court in the case ofKankanala Ravindra Reddy (l supra). There shatl be no order as to costs Consequently, miscellaneous petitions pending, if any, shall stand closed SD/. B. REKHA RANIASSISTANT REGISTRARsESi oFFrcERASSISTANT REGISTRARsESi oFFrcER //TRUE COPY// To 1. The Secretary, Union of lndia, Ministry of Finance, North Block, New Delhi.2. The Principal Chief Commissioner of lncome Tax, Aayakar Bhavan,Basheerbagh, Hyderabad - 500004.2. The Principal Chief Commissioner of lncome Tax, Aayakar Bhavan,Basheerbagh, Hyderabad - 500004. 3. The Deputy Commissioner of lncome Tax, Circle 2('1 ), Room No. 514, SthFloor, Signature Towers, Sy.No.6(P) of Kondapur, Sy 37(p) of Kothaquda,Opp. Botanical Gardens, Serlingampally (M), R. R.District, Hyderabad - [-]Telangana - 500084.Opp. Botanical Gardens, Serlingampally (M), R. R.District, Hyderabad - [-]Telangana - 500084. 4. One CC to SRI V.ANEESH, Advocate 5. One CC to SRI B.MUKHERJEE, LEARNED COUNSEL REPRESENTTNGTHE UNION OF lNDIA, Advocate (OPUC)THE UNION OF lNDIA, Advocate (OPUC) 6. One CC to Ms J SUNITHA, LEARNED JUNTOR STANDTNG COUNSEL FORTHE INCOME TAX DEPARTMENT, Advocate THE INCOME TAX DEPARTMENT, Advocate 7. Two CD Copies SAGJPGJP 21 HIGH COURT DATED:0210512025 ORDER WP.No.26939 of 2024 I ALLOWING THE W.PWITHOUT COSTS. o //. [/5]54 '-:-_\-..o2 6 [tUE ][2025]rr:.t',,, -,,rr.i'-:;a-.-_._..-/