Wp/25304/2024 Of Bal Reddy Kandhi v. Income Tax Officer Ward 1

t34111 HIGH COURT FOR THE STATE OF TELANGANAAT HYDERABAD(Special Original Jurisdiction) WEDNESDAY,THE EIGHTEENTH DAY OF SEPTEMBERTWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAULANDTHE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION NO: 25304 OF 2024 Between: Bal Reddy Kandhi, S/o Yadireddy, Aged about 56 years, Occ.Agriculture, 1-8211 , Varkatpally, Valigonda, Nalgonda, Telangana-508,1 12. ...PETITIONER AND 1lncome Tax Officer Ward 1, Suryapet, lncome Tax Office, Krishna NagarColony, Suryapet, Telangana-5082'l 3.Colony, Suryapet, Telangana-5082'l 3. 2. The Principal Chief Commissioner of lncome Tax AP and TS, 1Oth Floor, C-Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004.Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004. 3. National Faceless Assessment Centre, Delhi, The Assessment Unit, lncomeTax Department, National Faceless Assessmenl Centre, Delhi, Ministry ofFinance, Room No. 4O1 ,2nd Floor, E-Ramp, Jawaharlal Nehru Stadium,Delhi-'1 10003.Tax Department, National Faceless Assessmenl Centre, Delhi, Ministry ofFinance, Room No. 4O1 ,2nd Floor, E-Ramp, Jawaharlal Nehru Stadium,Delhi-'1 10003. 4. The Assessment Unit, lncome Tax Department, National FacelessAssessment Centre, Delhi, Ministry of Finance, Room No. 4O1,2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi-1 10003Assessment Centre, Delhi, Ministry of Finance, Room No. 4O1,2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi-1 10003 ...RESPONDENTS Petition under Article 226 of Ihe Constitution of lndia praying that in thecircumstances stated in the affidavit filed therewith, the High Court may becircumstances 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 Mandamus, declaring the Assessment Order dt. 2010312024 passed by the1st respondenl uls 147 r.w.s'l44 of the lncome-tax Act for A.Y. 2016-17 vide DINNo. ITBA/ASTlsl14712023-2411062968969(1 ),which is passed as a consequenceof the order passed u/s 14BA(d) dt. 28103/2023 vide DIN No.ITBtuAST/F/1 48A12022-231 I 05 1 499449(1 ) and the notice u/s 1 48 dl. 2810312023vide DIN No.ITBA/AST/S1148 112022-2311051505584(1), issued by the JAO (1stWrit of Mandamus, declaring the Assessment Order dt. 2010312024 passed by the1st respondenl uls 147 r.w.s'l44 of the lncome-tax Act for A.Y. 2016-17 vide DINNo. ITBA/ASTlsl14712023-2411062968969(1 ),which is passed as a consequenceof the order passed u/s 14BA(d) dt. 28103/2023 vide DIN No.ITBtuAST/F/1 48A12022-231 I 05 1 499449(1 ) and the notice u/s 1 48 dl. 2810312023vide DIN No.ITBA/AST/S1148 112022-2311051505584(1), issued by the JAO (1strespondent) instead of FA0(3rd respondent), as void, illegal, and contrary to theprovisions of lncome{ax Act and contrary to the Principles of Natural Justice,apart from being barred by limitation as prescribed u/s ['149 ]of the Actapart from being barred by limitation as prescribed u/s ['149 ]of the Act lA NO: 1 OF 2024 Petition under section 15'1 cPC praying that in the circumstances stated inthe affidavit filed in support of the petition, the High court may be pleased to stayall further proceedings pursuant to the Assessment order dt. 20103/2024 passedby the'1 strespondent u/s 147 r.w.s144 of the lncome-tax Act for A.y. 2016-17 videDIN No. ITBA/AST/S/14712023-2411062968969(1), and may pass such otherorder(s) as the Hon'ble court deems fit and proper in the interests of substantialjustice, as otheruvise the Petitioner would be put to irreparable loss and severeinjury. Counsel for the Petitioner: SRl. DUNDU SASHANK MANMOHAN Counsel for the Respondents: SRI BOKARO SAPNA REDDy (Jr. SC FORlNcoME TAX) The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAULAND THE HONOURABLE SRI .IUSTICE NAMAVARAPU RAJESI{WAR RAO WRIT PETITION No.253O4 OF 2024 ORDER: (per Hon'ble Justice Sujoy Paul) Counsel for the Petitioner: SRl. DUNDU SASHANK MANMOHAN Counsel for the Respondents: SRI BOKARO SAPNA REDDy (Jr. SC FORlNcoME TAX) The Court made the following: ORDER THE HONOURABLE SRI JUSTICE SUJOY PAULAND THE HONOURABLE SRI .IUSTICE NAMAVARAPU RAJESI{WAR RAO WRIT PETITION No.253O4 OF 2024 ORDER: (per Hon'ble Justice Sujoy Paul) Heard Sri Dundu Sashank Manmohan, learned counselfor the petitioner(s) and Ms.B.Sapna Reddy, learned JuniorStanding Counsel for Income Tax Department, for therespondents. 2. The ground taken by the learned counsel for thepetitioner(s) is that in furtherance of Finance Act, 2021, re-assessment process stood modilied but the respondents havenot taken care of it ald therefore notice issued under Section148 of the Income Tax Act, 196 1 cannot sustain judicialscrutiny. Since notice is bad in law, the consequential ordersare also bad in law. 3. During the course of hearing, learned counsel for theparties agreed that curtains on this issue are finally drawn bythis Court in a batch of writ petitions, W.P.No.25903 of 2022and other connected matters, decided by common orderdated 14.O9.2023. The 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 ][in]W.P.No.259O3 of 2022, held as under: '35. [In ][view ][of the ][aforesaid ][discussioBs, ][it ][is ][by ][now ][very]ctear that the [procedure ]to be [fouoeed ][by the ][respondent-]Departmetrt upon treatiag the notices [issued ][for ][reassessr[elrt]beiug under Section 148A, the subaequent Proceedlnga [was]mandatorily required to be undettake! [under ][the ][substituted]provislons as laid down under the Firance Act, [2021. ][Ilr ][the]absence of which, we are constrained [to ][hold ][that ][the]procedure adopted by the respondeat-DepattEent is [in]contravention to the statute i.e. the [Finaace ][Act, ][2O2l' ][at ][the]frrst instance. SecoEdly, it is [also ]ia direct [coDtraveDtion ][to]the directives issued by the [Hon'ble ][Supteae Court ][in ][the]case of Ashish Agarwal, supra. 36. For all the aforesaid reasons, the [impugned ][notices ][issued]and the p.oceedings drawn by the [respondent-Departmelt ][is]treither teaable, nor sustailable. The [notices so ][lssued ][and]the procedure adopted beiag [pet ]se [illegal, ][deserves ][to ][be and]sre accordiugly set aside/quashed. [As ][a ][consequelce, ][all ][the]impugned orders gettiag [quashed, ]the [consequeDtial orders]passed by the respondeat DepartEent [pursuart ]to [the notices]issued under Sectiou 147 alld [148 ][lPould also get ][quashed ][alrd]it is ordered accotdingly. The reason we are [quashing ][the]consequential order is ou the Prilciples [that ][when ][the]initiation of the [proceediugs ]itself [was ptocedurally ][wrong,]the subsequent orders also [gets ]DuUilied [automatically.]37. The preliminary objection raised by the Petitloner [is]sustaired and all these wdt petitions stands [allowed ]on [this]very [jurisdictioaal ]issue. Since the [impugned ]trotices [and]ordets are getting quashed on the [point ]ofjurisdiction, [se ][are]not inclined to [proceed ]further and [decide ]the [other ][issues]raised by the petitioael which stands [reserved ]to [be ][raised]aBd contended in an appropriate [proceedings.] 38. Since the Hoa'bte Supreme court had, [in ][the ][caae ][of]Ashish Agarwat, supra, as a ole-time measur€ [exercising the]powers under Article 142 of the coastitutiou of [India,]permitted the Revenue to proceed under the [substituted]prowisions, and this court allowitrg th€ petitions only on theprocedurat Ilaw, the right couferred otr the Revenue would \ remaiE reserved to -proceed furthet if they so want ftom thestage of the orde. of the Supreme Court in tbe case of AshishAgarwal, supra.39. No order as to costs." 38. Since the Hoa'bte Supreme court had, [in ][the ][caae ][of]Ashish Agarwat, supra, as a ole-time measur€ [exercising the]powers under Article 142 of the coastitutiou of [India,]permitted the Revenue to proceed under the [substituted]prowisions, and this court allowitrg th€ petitions only on theprocedurat Ilaw, the right couferred otr the Revenue would \ remaiE reserved to -proceed furthet if they so want ftom thestage of the orde. of the Supreme Court in tbe case of AshishAgarwal, supra.39. No order as to costs." 5. In view of the consensus arrived, the impugned ShowCause notice and consequential orders passed in this writpetition are set aside. Liberty is reserved to both the partiesto take respective stand ald to proceed in accordalce withlaw as per paragraph No.3B of the order dated 14.09.2023 inW.P.No.25903 of 2022. 6. The Writ Petition is allowed. No costs. Interlocutoryapplications, if aly pending, shall also stald closed. SD/- N. CHANDRA SEAR RAOASSISTANTEGISTRAR //TRUE COPY// N OFFICER SE To, 1. lncome Tax Officer Ward 1, Suryapet, lncome Tax Office, Krishna NagarColony, Suryapet, Telangana-50821 3.Colony, Suryapet, Telangana-50821 3.2. The Principal Chief Commissioner of lncome Tax AP and TS, [1Oth ]Floor, C-Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004.Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004.3. National Faceless Assessment Centre, Delhi, The Assessment Unit, lncomeTax Department, National Faceless Assessment Centre, Delhi, I\4inistry ofFinance, Room No. 401 ,2nd Floor, E-Ramp, Jawaharlal Nehru Stadium,Delhi-1 10003.Tax Department, National Faceless Assessment Centre, Delhi, I\4inistry ofFinance, Room No. 401 ,2nd Floor, E-Ramp, Jawaharlal Nehru Stadium,Delhi-1 10003.4- The Assessment Unit, lncome Tax Department, National FacelessAssessment Centre, Delhi, Ministry of Finance, Room No. [401 ],2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi-1 10003Assessment Centre, Delhi, Ministry of Finance, Room No. [401 ],2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi-1 100035. One CC to SRl. DUNDU SASHANK IMANIUOHAN Advocate [OPUCj6. One CC to SRl. BOKARO SAPNA REDDY [(Jr. ]SC FOR INCOI/E [TAX)]loPUCl6. One CC to SRl. BOKARO SAPNA REDDY [(Jr. ]SC FOR INCOI/E [TAX)]loPUCl 7. Two CD Copies KKS GJP 'tX/ HIGH COURT DATE D: 1 810912024 ORDER WP.No.25304 of 2024 ALLOWING THE WRIT PETITIONWITHOUT COSTS - nie)q0r',,|[^t't\"f o[R][ lHE ] [ r4.](,o0 B iAI 2025I.t/a).i.t P4 fr-:HI1!1.