Wp/11235/2024 Of M/S.shantiniketan Educational Society v. The Income Tax Officer

[ [3403 ]] HIGH COURT FOR THE STATE OF TELANGANAAT HYDERABAD(Special Original Jurisdiction) FRIDAY, THE TWENTY SIXTH DAY OF APRILTWO THOUSAND AND TWENTY FOURPRESENTTHE HON'BLE SRI JUSTICE SUJOY PAULAi{DTHE HON'BLE SRI JUSTICE N. TUKARAMJITWO THOUSAND AND TWENTY FOURPRESENTTHE HON'BLE SRI JUSTICE SUJOY PAULAi{DTHE HON'BLE SRI JUSTICE N. TUKARAMJI WRIT PETITION NO: 1'1235 OF 2024Between: lrzl/s.Shantiniketan Educational Society,3rd Floor,276l2RT,10-3-86,Vijayanagar Colony, Hyderabad - 500057. Repby itsPresidenttvlr. C. N. GajamohanPETITIONER AND 1_The lncome Tax Officer, Exemption Ward 1(4), Aayakar Bhavan,Basheerbagh, Hyderabad-500 004.Basheerbagh, Hyderabad-500 004.2The Principal Chief Commissioner of lncome Tax (Exemptions), A.P. andTelangana, lT Towers Masab Tank, Hyderabad-500 004.The Assessment Unit, lncome Tax Department, National FacelessAssessment Centre, Delhi. Ministry of Finance, Room No.401, 2 Floor, E.Ramp, Jawaharlal Nehru Stadium, Delhi - 100003.Telangana, lT Towers Masab Tank, Hyderabad-500 004.The Assessment Unit, lncome Tax Department, National FacelessAssessment Centre, Delhi. Ministry of Finance, Room No.401, 2 Floor, E.Ramp, Jawaharlal Nehru Stadium, Delhi - 100003. 4The Union of lndia, Rep. by its Secretary, Ministry of Finance, IRE#3,[IL'",.IRE#3,[IL'",. Petition under Article 226 of the Constitution of lndia praying that in thecircumstances stated in the affidavit filed therewith, the High Court may bepleased to issue a Writ, Order or Direction, more particularly one in the nature ofWrit of [t/andamus, declaring the Assessment Order, dated ['l ][110312024 ][passed ]bythe 1st Respondent under Section 147 read with Section 144 of lhe [lncome Tax]Act for the Assessment Year 2019-20 vide Document Identification Number [(DlN)]and Order No.|TBA/AST/5114712O23-24110624077O5(1), which is [passed ]as [a]consequence of the order [passed ]under [Section ]148A(d), dated 1110312023 [vide]DIN and Notice No.ITBA/AST/F/148A12022-2311050638144(1) and the noticeunder Section 148, dated 1110312023 [vide ]DIN and Notice No.ITBA/AST/S/148_112022-2311050638318(1 ) issued by [the ]1st Respondent instead of FacelessAssessing Officer, as void, illegal, without Jurisdiction and contrary to theprovisions of lncome Tax Act and contrary to the Principles of Natural Justice lA NO: 1 OF 2024 Petition under Section 1 51 CPC praying that in the circumstances stated inthe affidavit filed in support of the petition, the High Court may be pleased to grantstay of all further proceedings pursuant to the Assessment Order, dated1110312024 passed by the ['1st ]Respondent under Section 141 read with Section144 of the lncome Tax Act for the Assessment Year 2O1g-20 vide Document1110312024 passed by the ['1st ]Respondent under Section 141 read with Section144 of the lncome Tax Act for the Assessment Year 2O1g-20 vide Documentldentification Number (DlN) and Order No.|TBA/AST/S/ 14712023-24110624077O5(1)24110624077O5(1) Counsel for the Petitioner: SRI SHAIK JEELANI BASHA, COUNSEL FORSMT. SHAIK VAHEEDA SUSHMASMT. SHAIK VAHEEDA SUSHMA Counsel for Respondent Nos. 1 to 3: SRI VIJHAY K PUNNA (sENroR sc FoR tTD) Counsel for Respondent No. 4: SRI B. MUKHERJEE, SC FORSRI GADI PRAVEEN KUMAR,DEPUTY SOLICITOR GENERAL The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAULANDTHE HONOURABLE SRI JUSTICE N. TUKARAMJI WRIT PETITION No.11235 OF 2o24 ORDER: (per Hon'ble Justice Sujog Paul) Heard Sri Shaik Jeelani Basha, learned counselrepresenting Ms. Shaik Vaheeda Sushma, learned counsel forthe petitioner(s), Sri Vrjhay K Punna, learned Senior StandingCounsel for the respondent(s)-lncome Tax Department andSri B. Mukherjee, learned counsel representing Sri GadiPraveen Kumar, learned Deputy Solicitor General of India forthe respondent-Union of India. Counsel for Respondent Nos. 1 to 3: SRI VIJHAY K PUNNA (sENroR sc FoR tTD) Counsel for Respondent No. 4: SRI B. MUKHERJEE, SC FORSRI GADI PRAVEEN KUMAR,DEPUTY SOLICITOR GENERAL The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAULANDTHE HONOURABLE SRI JUSTICE N. TUKARAMJI WRIT PETITION No.11235 OF 2o24 ORDER: (per Hon'ble Justice Sujog Paul) Heard Sri Shaik Jeelani Basha, learned counselrepresenting Ms. Shaik Vaheeda Sushma, learned counsel forthe petitioner(s), Sri Vrjhay K Punna, learned Senior StandingCounsel for the respondent(s)-lncome Tax Department andSri B. Mukherjee, learned counsel representing Sri GadiPraveen Kumar, learned Deputy Solicitor General of India forthe respondent-Union of India. 2. The ground taken by the learned counsel for thepetitioner is that in furtherance of Finance 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, [196 ]1 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 ]theparties agreed that curtains on this issue are finally drawn [by] this Court in a batcl-r of writ petitions, W.P.No.25903 of 2022and other connected matters, decided by common orderdated 14.09.2023. Th,e parties agreed that this matter may bedisposed of in terms of the Common Order dated 14 .O9 .2023. 4. This Court in the said order dated 14.09.2023 rnW.P.No.259O3 of 2022, held as under: "35. [In ][view of ][the ][aforesaid discussions, ]it is by now veryclear that the procedure to be foltoqred by the respondent-Department upon treeting the notices issued for reassessmentbeing under Section 148A, the subsequent proceedlngs wasmandatorily required to be undertaken under the substitutedprovisions as laid down under the Finance Act, 2O21. In theabsence of which, we ale constrained to hold that theprocedure adopted by the respondent-Department is incontravention to the statute i.e. the Flnancc Act, 2O21, at thefirst instance. Secondly, it is also in direct contravention tothe directives issued by the Hon,ble Supreme Court in thecase of Ashish Agar$ral, supra. 36. For all the aforesaid teasons, the impugned Dotices issuedand the proceedings drawn by the respondent-Department isneither tenable, nor sustainable. The notices so issued andthe procedure adopted being per se illcgal, deserves to be andare accordingly set eside/quashed. As a consequence, all theimpugned orders getting quashed, the consequeEtial orderspassed by the respondent Department purauant to the noticesissued under Sectio! 147 and 148 rould also get quashcd andit ls ordered accordingly. The reason E'e are quashing theconsequential order is on the principleG that when theinitiation of the proceedings itself Bras procedurally wrong,the subs€quent orders also gets nullified automatically.37. The preliminary objection raised by the petitioner issustained and all these writ petitions stands allowed on thisvery jurisdictional issue. Since the impugned notices andorders are getting quashed otr the point ofjurisdlction, we arerrot inclined to proceed further and decide the other issues raised by the [petitioner ]which stends reserwed to be [ralsed]end contended in an appropriate proceedings.38. Since the Hon'ble Supreme Court had, in the [case ][of]Ashish Agarwal, supra' as a one-tlme measure [exercising the]powers under Article 142 of the Constitutior of India,permitted the Revenue to proceed under the substitutedprovisions, and this Court allowing the [petitlons ]only on [the]procedural flaw, the right conferred on the [Revenue would]remain reserved to [proceed ]further [if ][they ][so ][want from ][the]stage of the order of the Supreme [Court ][irr ][the ][case ][of ][Ashish]Agarwal, supta.39. No order as to costs." 5. In view of the consensus arrived, the [impugned ][Show] raised by the [petitioner ]which stends reserwed to be [ralsed]end contended in an appropriate proceedings.38. Since the Hon'ble Supreme Court had, in the [case ][of]Ashish Agarwal, supra' as a one-tlme measure [exercising the]powers under Article 142 of the Constitutior of India,permitted the Revenue to proceed under the substitutedprovisions, and this Court allowing the [petitlons ]only on [the]procedural flaw, the right conferred on the [Revenue would]remain reserved to [proceed ]further [if ][they ][so ][want from ][the]stage of the order of the Supreme [Court ][irr ][the ][case ][of ][Ashish]Agarwal, supta.39. No order 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.259O3 of 2022. 6. The writ petition is allowed. No costs. [Interlocutory]if applications, any [pending, shall also ][stand ][closed'] SD/-A.V.S.PRASADASSISTANT REGISRSECTIONFFICER //TRUE COPY// To,1The lncome Tax Officer, Exemption [Ward ][1(4), ][Aayakar ][Bhavan,]Basheerbagh, Hyderabad-500 [004.]1The lncome Tax Officer, Exemption [Ward ][1(4), ][Aayakar ][Bhavan,]Basheerbagh, Hyderabad-500 [004.]2The Princip-al Chlef Commissioner [of lncome ][Tax ][(Exemptions), A.P. ][and]Telangana, lT Towers ttlasab [Tank, ][Hyderabad-S00 ][004.]Telangana, lT Towers ttlasab [Tank, ][Hyderabad-S00 ][004.]3The A'ssessment Unit, lncome [Tax ][Department, National Faceless]Assessment Centre, Delhi. [Ministry of Finance, Room ][No.401 ][, ][2 ][Floor, ][E.]Assessment Centre, Delhi. [Ministry of Finance, Room ][No.401 ][, ][2 ][Floor, ][E.] Ramp, Jawaharlal Nehru Stadium, [Delhi ][- ][100003.]4.The Secretary, Ministry of Finance, [Union of ][lndia, ][New Delhi.]One CC to Smt. Shaik'Vaheeda [Sushma ][Advocate ] 6.One CC to Sri Vijhay K Punna [(SENIOR ] [FOR ITD) ][Advocate.tO.?U-q-. ].^.7.One CC to Sri Gidi Praveen [Kumar, Deputy ][Solicitor ][General ][of lndia ] B,Two CD CopiesMBCGJP N HIGH COURT DATED: 2610412024 J-:( ['l_a ]'. -.- '\1)'.[1;]\/.'YilN202{.i> ';; lg .+,:jORDER WP.No.11235 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS