Wp/26133/2024 Of Ramesh Kumar Agarwal v. Assistant Commissioner Of Income Tax

HIGH COURT FOR THE STATE OF TELANGANAAT HYDERABAD(Special Original Jurisdiction) MONDAY, THE TWENTY THIRD DAY OF SEPTEMBERTWO IHOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE SUJOY PAULANDTHE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO WRIT PETITION NO: 26133 OF 2024 Between: Ramesh Kumar Agarwal, S/o: Badrilal Agarwal, Erstwhile partner of Kamalalnternational(Dissolved Firm). Aged about 71 years, Occupation - Business, #H. No. 8-2-2931821N852, Road No.44, Jubilee Hills, Hyderabad - 500033. ...PETITIONER AND 1Assistant Commissioner of lncome Tax, Circle 8(1), Hyderabad, SignatureTowers, Sy.No.6(P) of Kondapur, Sy.No.37(P) of Kothaguda, OPP. BotanicalGardens, Serlingarnpally, Ranga Reddy, Hyderabad, Telangana - 500084.Towers, Sy.No.6(P) of Kondapur, Sy.No.37(P) of Kothaguda, OPP. BotanicalGardens, Serlingarnpally, Ranga Reddy, Hyderabad, Telangana - 500084. 2The Chief Commissioner of lncome Tax AP and TS, 1Oth Floor, C-Block, l.T.Towers, 10-2-3, A.C. Guards, Hyderabad-500004.Towers, 10-2-3, A.C. Guards, Hyderabad-500004. ...RESPONDENTS Petition under Arlicle 226 of the Constitution of lndia praying that in thecircumstances stated in the affidavit filed therewith, the High Court may bepleased to issue an appropriate writ order or direction more particularly one in thenature of Writ of Mandamus, declaring the notice u/s ['148 ]dt. 2910812024 vide DINNo. ITBtuAST/S/148_112024-2511068104688(1) issued by the JA0(1stcircumstances stated in the affidavit filed therewith, the High Court may bepleased to issue an appropriate writ order or direction more particularly one in thenature of Writ of Mandamus, declaring the notice u/s ['148 ]dt. 2910812024 vide DINNo. ITBtuAST/S/148_112024-2511068104688(1) issued by the JA0(1strespondent) instead of Faceless Assessing Officer(FAO) for A.Y. 2018-19, that tooto a non-existent entity, which was dissolved on 2210712014, as void, illegal, andcontrary to the provisions of lncome{ax Act and contrary to the Principles ofNatural Justice.contrary to the provisions of lncome{ax Act and contrary to the Principles ofNatural Justice. I lA NCr: 1 OF 2024 Petition under section '151 cpc praying that in the circumstances stated inthe afFidavit fired in support of the petition, the High court may be preased to stayall furlher proceedings pursuant to the notice u/s 14g dt. 2g/o}r2o24vide DrN No.IrBA/\ST/S/148-1r2024-2st1o68i046s8(1) issued by rhe JAO(1st respondent)instea,l of Faceless Assessing Office(FAO) for A.y. 2018_19. Couns,el for the Petitioner: SRI DUNDU MANMOHAN Counsel for the Respondents: MS. BOKARO SAPNA REDDY(Jr. sc FoR tNCoME TAX)(Jr. sc FoR tNCoME TAX) The Court made the following: ORDER I I THE HONOURABLE SRI JUSTICE SUJOY PAULAND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESENIAR RAO WRIT PETITION No.26t33 0F 2024 ORDER: (per Hon'bte Sri Justice Sujog paut) Heard Sri Dundu Manmohan, iearned counsel for thepetitioner(s) and Ms. B. Sapna Reddy, learned JuniorStanding Counsel for Income Tax Department, for therespondents.Standing Counsel for Income Tax Department, for therespondents. 2. The ground taken by the learned counsel for thepetitioner(s) is that in furtherance of Financ e Act, 2021, re-assessment process stood modified but the respondents havenot taken care of it and therefore, notice issued underSection 148 of the Income Tax Act, 196 1 cannot sustainjudicial scrutiny. Since notice is bad in law, theconsequential 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 bythis Court in a batch of writ petitions, W.p.No.25903 of 2022and other connected matters, decided by common orderdated 14.09.2023. The parties agreed that this ma.tter may bedisposed of in terms of the Comrnon Order dated 14.O9.2023. 4. This Court in the said order [dated ][l4-O9.2O23 ][rn]W.P. \o.25903 of 2022, [held ][as ][under:] 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 14.09.2023. The parties agreed that this ma.tter may bedisposed of in terms of the Comrnon Order dated 14.O9.2023. 4. This Court in the said order [dated ][l4-O9.2O23 ][rn]W.P. \o.25903 of 2022, [held ][as ][under:] "35. [Ia ][view ][of the ][aforesaid discussions, ][it ][is ][by ][now ][very]clear that the [procedure ][to ][be ][follorred ][by the ][respotrdent-]DepartEent upon treatiEg the [notices ][issued ][for ][reassessment]being ulrder Section [148A, ]the [subseque[t ][proceedings ][was]ruaDdatorily requited to [be ]uldertaken [uEder ][the substituted]provisions as taid dowa uEder the Finarce Act,2021. [In ][the]absence of c,hlch, se are [constraiaed ][to ][hold ][that ][the]procedure adopted by the respondetrt-DePartmert [is ][in]contraveEtio! to the statute [i.e. ]the [Fitrance ][Act, ][2o2l' ][at ][tlre]tirst iastance. secondly, it is [also ][in ][direct ][cootraveEtion ][to]the directives issued by the llon'ble [Supreme ][Court ][in ][the]case of Ashish Agarwal' [suPra.] 36. For atl the aforesaid [reaaons, ]the [inpugned ][Dotices issued]aDd the proceedings drawn by the [respoadent-DepartmeDt ][is]nelther tenable, nor [sustainable. ][The ][notices ][so ][issued ][arrd]the [procedure ]adoPted [beitrg ][pet ][se ][illegal, ][deserves ][to ][be ][and]are accorditrgly set [aside/quashed. ][As ][a ][colsequetrce, ][all ][the]impugned orders [getting ][quashed, ][the ][consequertial ][orders]passed by the respondent Department [pulsuaat ]to the [notices]iasued under Section 14? and [148 ][would ][also get quashed and]it is ordered accordiogly. The reasot [we ][are ][quashilg ][the]consequential ordet is o! the [pri[ciples ][that ][when ][the]initiation of the [proceediltgs ][itself ][was procedurally wioag']the subsequent orders also [gets ][auuified ][autotratically.]3?. The preumiE.ry objection raised [by ][the ][petitioner ][is]Euataitred and all these writ [petitions ][staads ][aUowed ][on ][this]very lurisdictional isaue. Siace the [impugred lrotices ][aad]orders are gettirg [quashed ]on the Poiut [of ][jurisdiction, ][we are]not iucllled to [proceed ]further and [decide ][the ][othet ][issues]raised by the [petitioner ]which [stands ][reserved ][to ][be ][raised]aad couteaded ia alr appropriate [proceedings.] 38. Since the Ho!'ble Supt'eEe Court [had, ][i! ][the ][case ][of]Ashish Agarc/al, [supra, as ]a one-tiEe [measure ][exercising the]powera utrder Article 142 of the Constitution [of ][India,]permitted the Revenue to proceed u!de. the substitutedprovlsions, aud this Court allowing the Petitions only [on ][the]procedural flaw, the right colferted olr the [Revenue ][would] I retDain reserved to proceed further if they so waat from thestage of the order of the Supreme Court ia the casc of AshishAgarwal, supta.39. No order as to costs.- 5. In view of the consensus arrived, the impugned Show Cause notice and consequentia_l orders passed in this writpetition zre set aside. Liberty is reserved to both the partiesto take respective stand and to proceed in accordance withlaw as per paragraph No.38 ofthe order dated 14.09.2023 inW.P.No.25903 of 2022. 6. The Writ Petition is a_llowed. No costs. Interlocutoryapplications, if any pending, shall also stand closed. ;SD/. T, TIRUMALA DEVI1ASSISTANT REGISTRAR//TRUE COPY//SECTION OFFICER I retDain reserved to proceed further if they so waat from thestage of the order of the Supreme Court ia the casc of AshishAgarwal, supta.39. No order as to costs.- 5. In view of the consensus arrived, the impugned Show Cause notice and consequentia_l orders passed in this writpetition zre set aside. Liberty is reserved to both the partiesto take respective stand and to proceed in accordance withlaw as per paragraph No.38 ofthe order dated 14.09.2023 inW.P.No.25903 of 2022. 6. The Writ Petition is a_llowed. No costs. Interlocutoryapplications, if any pending, shall also stand closed. ;SD/. T, TIRUMALA DEVI1ASSISTANT REGISTRAR//TRUE COPY//SECTION OFFICER To,'1 . Assistant Commissioner of lncome Tax, Circle 8(1), Hyderabad, SignatureTowers, Sy.No.6(P) of Kondapur, Sy.No.37(P) of Kothaguda, OPP. BotanicalGardens, Serlingarnpally, Ranga Reddy, Hyderabad, Telangana - 500084.2. The Chief Commissioner of Income Tax AP and TS, 1Oth Flbor, C-Block, l.T.Towers, 10-2-3, A.C. Guards, Hyderabad-500004.Towers, Sy.No.6(P) of Kondapur, Sy.No.37(P) of Kothaguda, OPP. BotanicalGardens, Serlingarnpally, Ranga Reddy, Hyderabad, Telangana - 500084.2. The Chief Commissioner of Income Tax AP and TS, 1Oth Flbor, C-Block, l.T.Towers, 10-2-3, A.C. Guards, Hyderabad-500004. 3. One CC to Sri Dundu Manmohan, Advocate IOPUC] 4. One CC to Ms. Bokaro Sapna Reddy (Jr. SC for lncome Tax) 5. Two CD Copies TJ,W l / HIGIH COURTISP,J&RRNJDATED:2310912024i 5 s.t4^[$]II>rlORDERII',22il[uttp.\aosso2 7. ".1WP,No.26133 of 2024IALLOWING THE WRIT PETITTONIIWITHOUT COSTSIlj.6lr+S*t