Wp/24629/2024 Of Primary Agriculture Coop Society Limited v. The Assistant Commissioner Of Income Tax Circle 1

HIGH COURT FOR THE STATE OF TELANGANAAT HYDERABAD(Special Original Jurisdiction) MONDAY, THE NINTH DAY OF SEPTEMBERTWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY THE HONOURABLE SRI JUSTICE NAMAVARAPU WRlT PETITION NO: 24629 OF 2024 Between: Primary Aqriculture Coop Society Limited, Rep. [By ][its ][Secretary ][Bodakuntla]Viiender, [-S/o.Raiaiah ]Eiodakuntla, Occupation. [Business ][Aged ][about ][41]years, RD. KundbramV , Mandal Kalvasrirampoor, Dist Karimnagar [505174']Telangana, lndia. ..,PETITIONER AND 1The Assistant Commissioner of lncome Tax Circle [1, ][Karimnagar, lncome Tax]Office, Aayakar Bhavan, Near Natraj [Theatre, Karimnagar Telangana ][State.]Office, Aayakar Bhavan, Near Natraj [Theatre, Karimnagar Telangana ][State.] 2The Principal chief Commissioner of lncome [Tax ][Telangana ][an^d^AP^,^]Hyderabad, lT Towers, AC Guards, [Masab ][Tank, Hyderabad 500 ][028,]TelanganaHyderabad, lT Towers, AC Guards, [Masab ][Tank, Hyderabad 500 ][028,]Telangana .)The National Faceless Assessment Center, [lncome ][Tax ][Department, ][New]Delhi.Delhi. 4The Central Board of Direct Taxes, Represented [by ][its Chairman, Department]of Revenue, Ministry of Finance, Goveinment [of ][lndia, Secretariat Buildings']New Delhi - 1 ['10 ]001 .of Revenue, Ministry of Finance, Goveinment [of ][lndia, Secretariat Buildings']New Delhi - 1 ['10 ]001 . 5. The Union of Department of Revenue, Ministry of lndia, , Represented [by][F]inance, New Delhi its Secretary to the Government,[- ]110 [00'l ][.] ,..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 issue an appropriate writ, order or direction [more particularly one ][in ][the]nature of Writ of Mandamus declaring [the ][order passed ][by the ][lncome ][Tax]Authorities (National Faceless E-Assessment [Centre) completed ][the ][assessment]UIS 147 r.w.s 144 read [with ][section ][1448 ][of ][the ][lncome-tax ][Act ][Date ][of] ./ 1310212024, DIN lTBA/ASTtst147 t2023-24tio6o\4514i(1) for the AssessmentYear 2019-20 determining the total income of Rs. 29,26 14ol-as arbitrary, illegal,bad in law, without lurisdiction, void-ab-initio, violative of the principles of naturaljustice apart from being violative of Articles ia, 19(i and 265 cif the)(g) Constitution of lndia and Sec. 14BA of the lncome Tax Act, .1961, andconsequently set aside the same in the interests of justice. Counsel for the Petitioner: SRI THANNERU CHA|TANYA KUMAR 99^r!i"] [for the Respondent ][Nos.1 ][to ][3: ][MS. ] [(JUN|OR ]SC FORrNcoME TAX) 9gyry"t [for the Respondent ][No.4: ][SRI B. MUKHERJEE, ] FORSRI GADI PRAVEEN KUMAR, DEPUTYSOLICITOR GENERALOF INDIA counsel for the Respondent No.5: sRr puLrMAMrDr sHASHTDAR REDDY The Court made the following: ORDER THE HONOURABLE SRI [JUSTICE SUJOY PAUI']AND THE HONOURABLE JUSTICE [NAMAVARAPU RAiIESHWAR ] U/RIT PETITION [No.2][ 4629 ][0F ][2024] ORDER: [(per ]Hon'bte [Justice ][Suioy ][Paul)] Heard T. Chaitanya [Kumar, ][learned ][counsel ][for ][the] petitioner, Ms. J'Sunitha, [lea-rned ][Junior ][Standing ][Counsel]for Income Tax [Department ][for the ][respondents-Income ][Tax]Sri [B. ][Mukherjee, learned counsel representing]Department. Sri Gadi Praveen [Kumar, ][learned Deputy ][Solicitor ][General ][of]India for the [respondents-Central ][Government' ][Sri]Pulimamidi Shashidhar [Reddy, ][learned ][counsel ][for]respondent [No.5.] counsel for the Respondent No.5: sRr puLrMAMrDr sHASHTDAR REDDY The Court made the following: ORDER THE HONOURABLE SRI [JUSTICE SUJOY PAUI']AND THE HONOURABLE JUSTICE [NAMAVARAPU RAiIESHWAR ] U/RIT PETITION [No.2][ 4629 ][0F ][2024] ORDER: [(per ]Hon'bte [Justice ][Suioy ][Paul)] Heard T. Chaitanya [Kumar, ][learned ][counsel ][for ][the] petitioner, Ms. J'Sunitha, [lea-rned ][Junior ][Standing ][Counsel]for Income Tax [Department ][for the ][respondents-Income ][Tax]Sri [B. ][Mukherjee, learned counsel representing]Department. Sri Gadi Praveen [Kumar, ][learned Deputy ][Solicitor ][General ][of]India for the [respondents-Central ][Government' ][Sri]Pulimamidi Shashidhar [Reddy, ][learned ][counsel ][for]respondent [No.5.] 2. The [ground ][taken ][by ][the ][learned ][counsel ][for ][the]petitioner 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 tl-re [course ][of ][hearing, learned ][counsel ][for ][the]that [curtains ][on ][this ][issue ][are ][finally ][drawn ][by]parties,.agreed this Court in a batch of writ petitions, W.P.No.25903 of 2022arrd other connected matters, decided by common orderdated 14.09.2023. The parties agreed that this matter may bedisposed of in terms of the Common Order dated 14.09.2023 4. This Court in the said order dated 14.09.2023 inW.P.No.25903 of 2022, held as under: "35. [In ][view ]of the [aforesaid ]discussions, it is by now veryclear that the procedu.e to be followed by the respondent-Department upon treating the notices issued for reassessmentbeing undcr Section 148A, the subsequent proceedings wasmandatorily required to be undertaken under the substitutedprovisions as lald dowr under the Finaflce Act,2021. In theabsence of Ehich, we are cotstrained to hold that theprocedure adopted by the respondent-Department is incontravention to the statute i.c. the Finance Act, 2O21, at thefrrst instance. Secondly, it is also itr direct contraventior tothe directives issued by the Hon'ble Supreme Court in thecase of Ashish AgarEal, supra. 36. For all the aforesald reasons, the impugaed notices issuedand the proceedings drawn by the respoDdent-Department isneither tenable, aot sustainable. The notices so issucd aadthe procedurc adopted beitrg per se illegal, deserves to be andare accordingly set aside/quashed. As a consequence, aU theimpugned ordets Betting quashed, the consequcntial orderspassed by the respoDdent Department pursuant to the noticesissued under Section 147 and 148 rould also get quashed andit is ordered accordingly. The reason we are quashing theconsequential order is on the principles that when theinitiation of the proceedings itself traa procedurally wrong,the subsequent orders also gets nultified automatically,37. The preliminary objection raised by the petitioner issustained and all these writ petitioEs stands allowed on thisvery jurisdictional issue. Since the impugned notices andorders are getting quashed on the point ofjurisdiction, we arenot inclined to proceed further and dccide the other issues I I ralsed by the petitioner which stands reserued to be raisedand conteaded ia eE eppropriete proceedirgs-38. Sittce the Hon'ble Supreme Court had, in the case ofAshish Agarwal, supra, as a one-time measure exercislag thepowers under Article 142 of the Constitution of India,permitted the Reverue to proceed uEder the substitutedprovisiotrs, aad this Court allowirg the petitions only ou tbeprocedural flaw, the rlght cotrfe[ed ou thc Revenue c/ouldremain reserved to proceed further if they [so ]want from [the]stage of the order of the Supreme Court in the casc of [Ashish]Agarqral, supra.39. No order as to costs." I I ralsed by the petitioner which stands reserued to be raisedand conteaded ia eE eppropriete proceedirgs-38. Sittce the Hon'ble Supreme Court had, in the case ofAshish Agarwal, supra, as a one-time measure exercislag thepowers under Article 142 of the Constitution of India,permitted the Reverue to proceed uEder the substitutedprovisiotrs, aad this Court allowirg the petitions only ou tbeprocedural flaw, the rlght cotrfe[ed ou thc Revenue c/ouldremain reserved to proceed further if they [so ]want from [the]stage of the order of the Supreme Court in the casc of [Ashish]Agarqral, supra.39. No order as to costs." 5. In view of the consensus arrived, the impugned ShowCause 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]Iaw as per paragraph No.38 of the order dated [14.09.2023 ][in]W.P.No.25903 of 2022. 6. The writ petition is allowed. No costs' Interlocutory applications, if any pending, shall also [stand ][closed] SDL K. ASSISTANT //TRUE r1v,,SECTIffOFFICER ylhI,ltt F4/ HIGH COURT DATED:0910912024 ORDERWP.No.24629 of 2024 ALLOWING THE WRIT PETITIONWITHOUT COSTS ()1,STArl-($r'!J(()3 [0 ][Nll\J ][zul]z-\'5s :,1-;Pr-0