Wp/28453/2022 Of Mr. Yellaiah Setty v. The Assistant Commissioner Of Income Tax And 2 Others

i I HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD(Special Original Jurisdiction) THURSDAY ,THE SEVENTH DAY OF JULYTWO THOUSAND AND TWENTY TWO PRESENT THE HONOURABLE THE CHIEF JUSTICE UJJAL BHUYANANDTHE HONOURABLE MRS JUSTICE SUREPALLI NANDA WRIT PETITION NO: 28453 OF 2022 Between: Mr. Yellaiah Setty, S/o Mr. S.Kanthaiah, Aged 68 years, Occ. Business, R/o16-2-1461C12, Flat No, 202, Dayanand Nagar, Malakpet, Hyderabad - 500036, Telangana. ...PETITIONER AND IThe Assistant Commissioner of lncome Tax, Circle - 9(1), Hyderabad, lTTowers, AC Guards, Masab Tank, Hyderabad - 500 004, Telangana.Towers, AC Guards, Masab Tank, Hyderabad - 500 004, Telangana. 2The Principal Commissioner of lncome Tax - 4, Hyderabad, Room No. 211,2nd Floor, lT Towers, AC Guards, Masab Tank, Hyderabad - 500 004,Telangana.2nd Floor, lT Towers, AC Guards, Masab Tank, Hyderabad - 500 004,Telangana. 3. The Principal Chief Commissioner of lncome Tax, Andhra Pradesh andTelangana, Hyderabad, Room No, 922, [gth ]Floor, B Block, lT Towers, 10-2-3,A.C. Guards, Hyderabad - 500 004, Telangana.Telangana, Hyderabad, Room No, 922, [gth ]Floor, B Block, lT Towers, 10-2-3,A.C. Guards, Hyderabad - 500 004, Telangana. ...RESPONDENTS Petition under Article 226 of the 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 of Mandamus or any other appropriate Writ, Order orDirection, declaringDirection, declaring a. the order dated 08.04.2022, passed u/s 148A(d) of the Act, vide DIN andNotice No ITBA/AST/F/148A12022-2311042659226(1), by the 1st Respondent, forthe Assessment Year 2015 - 16 and b the notice dated 11.04.2022, issued by the 1st Respondent, u/s 148 of thelncome Tax Act, 1961, vide DIN and Notice ITBA/AST/S/148 112022-2311042689500( 1), for the Assessment Year 2015 - 16 as arbitrary, illega bad in law, void-ab-initio, violative of tlre principles of naturaljustice apart fron being violative of Articles 14, 19(1)(g) and 265 of theConstitution of lr dia and Sec. 14BA of the lncome Tax Act, 1961, andconsequently set a ;ide the same in the interests of justice. lA NO: I OF 2022 Petition und rr Section 151 CPC praying that in the c rcumstances stated inthe affidavit filed ir support of the petition, the High Court nra,/ br., pleased to stayall fu(her proceer ings, including any recovery, pursuan' to the notice dated11.04.2022, issuec by the 1st Respondent, u/s 148 of the lncome Tax Act, 196'l ,vide DIN and ltotice ITBA/AST/S/148_112022- 23110a2689500('1), for theAssessment Year i 015 - 16, pending disposal of the above \Vrit Petition.all fu(her proceer ings, including any recovery, pursuan' to the notice dated11.04.2022, issuec by the 1st Respondent, u/s 148 of the lncome Tax Act, 196'l ,vide DIN and ltotice ITBA/AST/S/148_112022- 23110a2689500('1), for theAssessment Year i 015 - 16, pending disposal of the above \Vrit Petition. Counsel for the Pe titioner:SRl. A V A SIVA KARTIKEYACounsel for the Rr spondents: B NARASIMHA SARMAThe Court made tt ? following: THE HON'BLE THE CHIEF JUSTICE UJJAL BII(ryANANDTHE HON'BLE MRS JI'STICE ST'REPALLI NANDA WRIT PETITION No.28453 of 2022 ORf,IER: eer tLe Hon'ble th. ChieI Justice Ujjal Btu-Lgc,ft) Heard Mr. A.V.A.Siva Kartikeya, learned counsel forthe petitioner and Mr. B. Narasimha Sarma, learnedcounsel for the respondents. 2. By filing this petition under Article 226 of theConstitution of India, petitioner seeks quashing of orderdated O8.O4.2O22 passed by respondent No.1 underSection 148A(d) of the Income Tax Act, 196l (briefly, 'theAct' hereinafter), for the assessment yea-r 20l5-16. Counsel for the Pe titioner:SRl. A V A SIVA KARTIKEYACounsel for the Rr spondents: B NARASIMHA SARMAThe Court made tt ? following: THE HON'BLE THE CHIEF JUSTICE UJJAL BII(ryANANDTHE HON'BLE MRS JI'STICE ST'REPALLI NANDA WRIT PETITION No.28453 of 2022 ORf,IER: eer tLe Hon'ble th. ChieI Justice Ujjal Btu-Lgc,ft) Heard Mr. A.V.A.Siva Kartikeya, learned counsel forthe petitioner and Mr. B. Narasimha Sarma, learnedcounsel for the respondents. 2. By filing this petition under Article 226 of theConstitution of India, petitioner seeks quashing of orderdated O8.O4.2O22 passed by respondent No.1 underSection 148A(d) of the Income Tax Act, 196l (briefly, 'theAct' hereinafter), for the assessment yea-r 20l5-16. 3. Petitioner is an assessee under the Act. For theassessment year 2015-16, a noti.ce dated 22.03.2022 wasissued by respondent No.1 under Section 14BA(b) of theAct. As per the said notice, it was stated that information4ece.ed [by ][respondent ][No.l ][suggested ][that ][income]chargeable to tax for the assessment yea-r 20 I 5- 16 had escaped ass( ssment within the meaning of Section 147 ofthe Act. T re details of information and enqtrin, wereenclosed to t re said notice as an Annexure 4. Petitior er submitted reply. Howeve ', by theimpugrred o der dated O8.O4.2O22 reply of th,: pelitionerwas not accr pted. Deciding that it is a fit case f cr isr;uanceof notice unr er Section 148 of the Act, the imprrgnerl orderwas passed mentioning that prior approval wrrs otrtainedfrom the spe :ified authority. 5. Accord ng to learned counsel for the petjtioner,respondent [,lo. ]t had gone beyond the four t ransactionsmentioned ir the Annexure to the notice dated '.r.2,,O3i.2022.Respondent No.l had gone into the turnover of thepetitioner as declared in its return. Had this asper:t beenbrought to t re notice of the petitioner by way o1'the notice,petitioner w uld have met the above queries of re:spondentNo.l. He ai o submits that respondent No.1 took the viewthat petitio rer had failed to substartiate the nexusbetween u,i hdrar.r,n cash and non-cash credits, again pointing out that this was not the subject matter of theshow cause notice.show cause notice. 6. In the hearing, learned counsel for the petitioner hasdrawn our attention to Section 151A of the Act which dealswith faceless assessment of income escaping assessmentand submits that on the basis of the above statutoryprovision, noti{ication dated 29.03.2022 was issued by theCentral Board of Direct Taxes. As per the said notification,insofar assessment, reassessment or recomputation underSection 147 ol the Act or issuance of notice under Section148 of the Act is concerned, the same should be throughautomated allocation, but in the present case theimpugned order was passed in a physical manner. 7. Learned Standing Counsel for Income TaxDepartment submits that the writ petition has been filed ata stage prior to issuance of notice under Section 148 of theAct. He submits that petitioner would have ampleopportunity to have his say during the course ofreassessment proceedings. Even if the petitioner remainsaggrieved thereafter, he would have a hierarchy of remedies. [' 'herefore, ]no interference is <:alled f.or at thisstage. Insol u notification dated 29.O3.2022 is conr:emed,learned Sta rding Counsel submits that t-he n otice underSection 148 {(b) of the Act was issued prior t-hereto on22.03.2022 to which learned counsel f<rr th,: petitionersubmits tha the impugned order was passed thereaJter. 8. We ha re given our thoughtful considerz.tion to therival submis ;ions made at the bar. 7. Learned Standing Counsel for Income TaxDepartment submits that the writ petition has been filed ata stage prior to issuance of notice under Section 148 of theAct. He submits that petitioner would have ampleopportunity to have his say during the course ofreassessment proceedings. Even if the petitioner remainsaggrieved thereafter, he would have a hierarchy of remedies. [' 'herefore, ]no interference is <:alled f.or at thisstage. Insol u notification dated 29.O3.2022 is conr:emed,learned Sta rding Counsel submits that t-he n otice underSection 148 {(b) of the Act was issued prior t-hereto on22.03.2022 to which learned counsel f<rr th,: petitionersubmits tha the impugned order was passed thereaJter. 8. We ha re given our thoughtful considerz.tion to therival submis ;ions made at the bar. 9. This isa case of proposed reassessment. In view oftJre newly in;erted Section 148,4' in the Act, there has beena paradigrr shift in the procedure followed forreassessmert under Section 147 of the Act. Prior toissuance ofnotice under Section 148 of the Act, a noticeunder Sectirn 148A(b) of the Act is required tr be issuedenabling theperson concerned to submit reply tvhereafterthe assessir:3 [authority ][upon ][receipt ][of ][approval ][from ][the]specifred au-hority is mandated to pass an c rcler underSection 148t(d) ol the Act, whether the case is Iit forreopening olnot- Once it is decided that it is a case fit for reopening, consequential notice under Section 148 of theAct is issued. 10. In the above backdrop, the order under Section148A(d) of the Act is at a stage prior to issuance of noticeunder Section 148 of the Act. Unless glaring omissions aredemonstrated or the conditions precedent for exercise ofthe power to reopen assessment are not complied with, awrit Court would not ordinarily interfere with an orderpassed under Section la8A(d) of the Act inasmuch as theproceedings is at a very nascent stage even prior toissuance of the statutory notice under Section 148 of theAct. i 1. Further, \ [/e ]are of the view that contentions raised bythe petitioner can very well be raised in the reply to thenotice issued under Section 148 of the Act. At this stage,preempting the authorities from proceeding further on thegrounds urged in the writ petition would not be proper.We, therelore, decline to interfere in the matter. t2Writ petition is accordingly dismissed. 13. Miscell rneous applications pending, if any, shall stand closed However, there shall be no order e-s to costs. SD/.K.ONESIM DEPIJTY REGISTRAR /( tl)SECTION OFFICER( tl)SECTION OFFICER //TRUE COPY// To, 1. OneCCto )RI.AVASIVA KART|KEYAAdvocate [CprJC]2. One CC to { Rl. B NARASTMHA SARMA Advocare 3. Two CD Co1 ies.4. One Spare [( ]opyPMSBNY HIGH COURT DATED:O7 10712021 ORDERWP.No.28453 of 2O 2 Dismissing the WPWithout costs.-/(9 qt1'JLuLg