Wp/33444/2024 Of Primary Agricutural Co Operative Credit Society Limited v. The Income Tax Officer Ward 1

13447 1 HIGH COURT FOR THE STATE OF TELANGANAAT HYDERABAD(Special Original Jurisdiction) MONDAY, THE TWENTY EIGHTH DAY OF APRILTWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE.P.SAM KOSHYAND THE HONOURABLE SRI JUSTICE NARSING RAO NANDIKONDA WRIT PETITION NO: 33444 OF 2024 Between: PRIMARY AGRICUTURAL CO OPERATTVE CREDIT SOC|ETy LtM|TED, Rep. bythe CEO CHINTALA KESHAV, S/o: NARAyANA CHINTALA, Aged about 58 y'ears,Qgqypation, [Business, R/o. OLD GRAMA PANCHAYAT ][OFF|CE", ][THAMSt. ]rfinn4srMANDAL, ADILABAD 504312, Tetangana, tndia. pAN. , AssessmentYear.2019-2O.the CEO CHINTALA KESHAV, S/o: NARAyANA CHINTALA, Aged about 58 y'ears,Qgqypation, [Business, R/o. OLD GRAMA PANCHAYAT ][OFF|CE", ][THAMSt. ]rfinn4srMANDAL, ADILABAD 504312, Tetangana, tndia. pAN. , AssessmentYear.2019-2O. .....PETITIONER AND 1. The Income Tax Officer Ward 1, Adilabad/ Adilabad, Hyderabad, Adilabad,Hyderabad, Hyderabad 504106, Telangana.Hyderabad, Hyderabad 504106, Telangana. 2. T.he Principa.l Cl'rief Commissioner of lncome Tax, Telangana and A.p,Hyderabad, lT Towers, AC Guards, Masab Tank, HyderJbad - 5O0O2tj,Telangana.Hyderabad, lT Towers, AC Guards, Masab Tank, HyderJbad - 5O0O2tj,Telangana. 3. The Central Board of Direct Taxes, Represented by its Chairman, Departmentof ReIenue, Mhi^stry of Finance, Goveinment of lnaia, Secretariat Buildings,New Delhi - 1 ['10 ]001 .of ReIenue, Mhi^stry of Finance, Goveinment of lnaia, Secretariat Buildings,New Delhi - 1 ['10 ]001 . 4. The National Faceless Assessment Center, lncome Tax Department, NewDelhi.Delhi. 5. The Union of lndia, Represented by its Secretary to the Government,.1 .1 Department of Revenue, Ministry of Finance, New Delhi - 10 001 . .....RESPONDENTS 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 an appropriate writ, order or direction more particularly one inthe nature of Writ of Mandamus, declaring the order passed by the lncome Tax Authorities (National Faceless E-Assessment centre) completed the assessmentuls 147 r-w-s 144 read with section 1448 of the lncome-tax Act Date of i 5-02-uls 147 r-w-s 144 read with section 1448 of the lncome-tax Act Date of i 5-02-2024, DIN lrBA/AST/s/i47t2o23-24t1o6o9sis32(1) for the Assessment year2019-20 determining the total income of Rs. 3,2B,35,361/-. as arbitrary, illegal,bad in law, without jurisdiction, void-ab-initio, violative of the principles of naturalbad in law, without jurisdiction, void-ab-initio, violative of the principles of naturaljustice apart from being violative of Articles14, 19(1Xg) and 265 of theConstitution of lndia and Sec. 148A of thelncome Tax Act, 1961, andconsequently set aside the same in the interests of justiceconsequently set aside the same in the interests of justice |.A.NO:1 OF 2024 Petition Under Section 151 cpc praying that in the circumstances stated inthe affidavit filed in support of the petition, the High court may be pleased tosuspend the order Under section 147r.w.s 144 read with section 1448 of thelncome-tax Act Date of ['1s-02-2o24, ]DtN ITBAiAST/S/147t2023-2411060981532(1) for the Assessment year 2o1g-20, determining the totalincome of Rs. 3,28,35,361/- and Demand notice u/s 156 of the lncome Tax act'1961, vide DIN and Notice No. ITBA/AST/Si156t2023-24t106098i568(1) Dt. 15-o2-2o24 for the assessment year 2o1g-20 pending disposal of the above writpetition. Counsel for the Petitioner : SRI THANNERU CHAITANYA KUMAR 99_r!:"] [for ][the Respondent ][Nos.1 ][to ][4 : ][Ms. ][J.SUN|THA (JUN|OR ]SC FORrNcoME TAX) 99I1s"! [for the Respondent ][No.S ][: ][SRt ][B.MUKHERJEE, LEARNED ]COUNSELREPRESENTING UNION OF INDIA The Court made the following ORDER / THE HONOURABLE SRI JUSTICE P.SAM KOSHYANDTHE HONOURABLE SRI JUSTICE NARSING RAONANDIKONDA WRIT PETITION No.3344 4 0R 2024 Counsel for the Petitioner : SRI THANNERU CHAITANYA KUMAR 99_r!:"] [for ][the Respondent ][Nos.1 ][to ][4 : ][Ms. ][J.SUN|THA (JUN|OR ]SC FORrNcoME TAX) 99I1s"! [for the Respondent ][No.S ][: ][SRt ][B.MUKHERJEE, LEARNED ]COUNSELREPRESENTING UNION OF INDIA The Court made the following ORDER / THE HONOURABLE SRI JUSTICE P.SAM KOSHYANDTHE HONOURABLE SRI JUSTICE NARSING RAONANDIKONDA WRIT PETITION No.3344 4 0R 2024 ORDER, (per llon'ble Sri Justice p.Sam Koshy) Heard Mr.Thanneru Chaitanya Kumar, Iearned counsel for the petitioner, Ms.J.Sunitha, leamed Junior Standing Counselfor the Income Tax Department for respondent Nos. I to 4 andMr. B. Mukheg'ee, learned counsel representing the Union of Indiafor respondent No.5. perused the record. 2. This is a writ petition is a writ petition a writ petition writ petition petition where the proceedings the proceedings proceedings are eithereitherchallenged to the notices which were issued under Section l4gAand 148 of the Income Tax Act, 1961 (for short ,the Act,) or theassessment orders those have been passed under Section 147 ofthe Act which have been assailed. This is a writ petition is a writ petition a writ petition writ petition petition where the proceedings the proceedings proceedings are eithereither 3. This writ petition is being taken up today only on one of thegrounds, that the notices issued under Section l4gA of the Actand the subsequent initiation ofproceedings under Section l4g ofthe Act by the jurisdictional Assessing Officer, whereas in termsof the amendment that was brought to the Income Tax Act by way of Finance [Act, ][2021 ][w.e.f', ][01.04.2021 ][onwards, ][proceedings]under Section [148A ][of ][the ][Act ][as ][also under Section ][148 ][of ][the]Act ought to [have also ][been issued ][and ][proceeded ][in ][a ][faceless]manner. The contention contention of [[the ][petitioner ]][[petitioner ]][[is ][that ][the ][issue ][of]][[that ][the ][issue ][of]][[the ][issue ][of]][[issue ][of]][[of]] 4. The contention contention of [[the ][petitioner ]][[petitioner ]][[is ][that ][the ][issue ][of]][[that ][the ][issue ][of]][[the ][issue ][of]][[issue ][of]][[of]]proceedings being [in ][violation ][of ][the ][Finance ][Act, ][2021 ][i'e'' ][the]impugned notices [under Section ][l48A ][and Section ][148 ][ofthe ][Act]not being issued [in ][a ][faceless ][manner, ][have already ][been dealt ][with]and decided by [this ][Court ][in ][the ][case ][of ] RAVINDRA [REDDY vs. ] [decided]on 14.09.2023 [whereby ][a ][batch ][of ][writ ][petitions were ][allowed ][and]the proceedings [initiated ][under ][Section ][l48A ][as ][also ][under ][Section]l48oftheActwereheldtobebadwithconsequentialreliefsontheground of it being [in ][violation of ][the ][provisions ][of ][Section 151A ][of]the Act read [with ][Notification ][l8l2\22 ][dated2g'03'2022' ][The said]judgment passed by this Court [has ][also ][been subsequently ][followed]in a large number [of ][writ ][petitions ][which ][were ][allowed ][on ][similar]terms , 5. Down the line, we find that the same issue has also beenfind that the same issue has also beenthat the same issue has also beensame issue has also beenissue has also beenalso beenbeendecided against the Revenue by various High Courts i.e.,by the Bombay High Court in the case of HEXAWARETECHNOLOGIES LTD., vs. ASSISTANT COMMISSIONEROF INCOME TAX & OTHERS2, Gauhati High Court in the caseof RAM NARAYAN SAH vs. UNION OF INDIA3, punjab andHaryana High Courr in the case of JATINDER SINGH BANGUvs. UNION OF INDIA4, and Telangana High Court in the case ofSRI VENKATARAMANA REDDY PATLOOLA vs. DEPUTYCOMMISSIONER OF INCOME TAX5 where the issue was inrespect of international taxation, Bombay High Court in the case ofABHIN ANILKUMAR SHAH vs. INCoME TAx OFFICE&INTBRNATIONAL TAXATION6 which is again on intemationaltaxation and central circle, High Court of Himachal pradesh in thecase of GOVIND SINGH vs. INCOME TAX OFFICERT,Gujarat High Court in the case of MANSUKHBHAI Down the line, we find that the same issue has also beenfind that the same issue has also beenthat the same issue has also beensame issue has also beenissue has also beenalso beenbeen ' .1zoz+1 464 trt.43o (Bom)'[t202+1 156 taxmann.com 47g (Cauhati)J'[t202+1 156 taxmann.com 47g (Cauhati)J^ tQ024) I 65 taxmann.com I l5 (punjab & Haryana)1'[2024) 167 taxmann.com 41 1 (Telangana)]:l?9?4) [166 ][taxmann.com ][679 ][(Bombay)l]'12024) I65 taxmann.com r tf inmu.iJipradesh)l'[2024) 167 taxmann.com 41 1 (Telangana)]:l?9?4) [166 ][taxmann.com ][679 ][(Bombay)l]'12024) I65 taxmann.com r tf inmu.iJipradesh)l DAHYABHAI [VS. ] [OFFTCER,]WARD 3(3Xt8, [Jharkand ][High Court ][in ][the ][case ][of ] SUNDAR [vs. ] [INDlAe, ][Rajasthan ][High ][Court ][in]the case of [vs' ] OFFICER & [and ][batch ][of ][writ ][petitionsro ][which]stood decided on [19.03.2024. ][Similar views ][have also ][been taken]the Division [Bench ][of ][Calcutta ][High ][Court ][in ][the ][case ][of]by GIRDHAR [vs' UNION OF ] [& ] (M.A.T 1690 of [2023)' decided ][on25'09'2024']6. Even though the [same issue ][having ][been decided ][by ][a ][large]number of [High ][Courts' we ][are ][still ][confronted ][with ][large ][filing ][of]identical matters [on ][daily ][basis ][ranging ][between ][5 ][to ][10 ][writ]petitions. That upon [the ][instructions ][being ][sought ][from ][the]Department, [they ][have ][been ][taking ][a ][solitary ][ground ][that ][the]decision of [the ][Bombay ][High ][Court ][in ][the ][case ][of ][Hexaware]Technologies [Ltd., ][(2 ][supra) ][as ][also ][the ][one ][which ][has ][been]decided by this [Court ][in ][the ][case ][of ][Kanakala Ravindra ][Reddy] '2024 [sCC ][online ][Guj ][4012]'2025 [Online ][Jhar ][287]t o yzo23 : RI- JD :49 84-DBl (l supra) has been subjected to challenge in a Special LeavePetition i.e., SLp No.3574 of 2024 before the Hon,ble SupremeCourt and the Hon ,ble Supreme Court is seized of the matter.In addition, there are about 1200 SLps also filed arising out ofthesame issue being decided by various High Courts. 7. To a query being put to the leamed counsel for the Revenue,they have categorically accepted the fact that there is no interimorder granted by the Hon,ble Supreme Court in any of thesematters pending belore it. Meanwhile, fresh writ petitions ofidentical nature are being piled up before this Bench on daily basisand the pendency is getting increased on matter which otherwisehas already been dealt and decided by this very High Court itself.8' on the one hand, even though the order of this court thatwas passed as early as on 14.09.2023 andmore 16 months havelapsed, till date, we do not find any remedial steps having beentaken by the Income Tax Department to take appropriate steps toeither hold back issuance of notice under Section 14gA and underSection 148 of the Act by the jurisdictional Assessing Officer,rather the authorities concemed in the teeth of series of decisions by all the [major ][High ][Courts ][in ][India ][are ][continuously ][still]initiating [proceedings ][under ][Section ][l48A ][of ][the ][Act ][and ][also]initiating [proceedings ][under ][Section ][148 ][of ][the ][Act ][in]contravention [to ][the amendments ][brought into the Income Tax ][Act]pursuant to the Finance [Act, ][2020 ][as ][also ][the ][Finance ][Act202l'] by all the [major ][High ][Courts ][in ][India ][are ][continuously ][still]initiating [proceedings ][under ][Section ][l48A ][of ][the ][Act ][and ][also]initiating [proceedings ][under ][Section ][148 ][of ][the ][Act ][in]contravention [to ][the amendments ][brought into the Income Tax ][Act]pursuant to the Finance [Act, ][2020 ][as ][also ][the ][Finance ][Act202l'] 9. Upon a [query being put ][as ][to why ][can't ][this ][writ ][petition ][be]of [in ][the teeth ][of ][the decision ][rendered ][by ][this ][Court in]disposed the case of [Kanukala Ravindra ][Reddy ][(l ][supra), ][leamed ][Standing]CounselforthelncomeTaxDepartmentcontendsthatthosewouldunnecessarily [burden ][the ][Income ][Tax ][Department ][where ][they]would be required [to ][file ][equal ][number ][of ][SLPs before ][the]Hon'ble Supreme [Court ][and ][it ][would be ][further ][burdening ][the]exchequeroftheUnionoflndia.Itwasalsothecontentionoftheleamed Standing [Counsel ][that ][no ][prejudice ][would ][be caused ][to ][the]interestofthepetitionersincaseifthiswritpetitioniskeptpendingtill the finalization [of ][the ][SLPs pending before ][the ][Hon'ble]Court [and ][the ][fact ][that the ][petitioner ][is ][already enjoying]Supreme the benefit of interim [protection. ][Nonetheless, on the ][earlier query]of this Court as [to ][why ][the Income ][Tax ][Department have ][not ][come]outwithamechanismtoissueappropriateinstructionsortotake i appropnate steps in ensuring that proceedings under Section l4gAof the Act as also the assessment orders under Section r4g of theAct are kept in a hold in the light ofthe decisions dedcided by thevarious High Courts, it was submitted by the learned StandingCounsel that the said steps can only be taken at the level of CBDTas any such steps would have to be taken pan India and cannot belimited to any of these jurisdictional High Courts. 10. As a result of which, what we are facing is steep increase oflitigation day in and day out even though various orders have beenpassed by this High Court allowing writ petitions on the very sameissue. The Income Tax authorities concerned are still even now in2025 also initiating proceedings in contravention to the provisionsof Section I 5 I A of the Act and as a result by now, more than 600to 700 petitions have been already got piled up before this HighCourt on an issue which otherwise stands squarely covered by thejudgment of this Court in the case of Kanakala Ravindra Reddy(1 supra). What is also surprising is the fact that though whileallowing the writ petitions in the case of Kanakala RavindraReddy (1 supra), the Division Bench while reserving the right ofthe Revenue, has also protecte<I the interest of the petitioners insofar as the liberty which [was ][granted ][to ][the ][Revenue for]initiating fresh proceedings strictly [in ][accordance ][with ][the ][amended]provisions of the Act, as amended [by ][the ][Finance Act,, 2020 ][and]the Finance Act, 2021 . The [petitioner ][assessee ][would ][be ][entitled ][to]challenge or raise the other [legal ][objections ][if ][the ][Revenue ][initiates]fresh proceedings. The [Department ][has made ][no ][endeavour in]availing the said liberty that [was reserved ][for ][the ][Revenue. On ][the]contrary, they have been still [sticking ][on to ][the ][stand, ][which ][this]High Court as well as [many other ][High ][Courts already ][held ][to ][be]bad. insofar as the liberty which [was ][granted ][to ][the ][Revenue for]initiating fresh proceedings strictly [in ][accordance ][with ][the ][amended]provisions of the Act, as amended [by ][the ][Finance Act,, 2020 ][and]the Finance Act, 2021 . The [petitioner ][assessee ][would ][be ][entitled ][to]challenge or raise the other [legal ][objections ][if ][the ][Revenue ][initiates]fresh proceedings. The [Department ][has made ][no ][endeavour in]availing the said liberty that [was reserved ][for ][the ][Revenue. On ][the]contrary, they have been still [sticking ][on to ][the ][stand, ][which ][this]High Court as well as [many other ][High ][Courts already ][held ][to ][be]bad. 11. It appears that because [ofthe ][aforesaid ][liberty ][that ][this ][High]Court had [granted ][permitting ][the ][Revenue ][for ][initiating ][fresh]proceedings as a one-time measure [in ][a ][faceless ][manner, ][the]Income Tax Department [wants ][to ][take ][advantage ][of ][the ][same ][by]protracting these proceedings which [would ][enable ][them ][to ][meet the]limitation that would otherwise [come ][in ][the ][way. ][Likewise, ][if ][the]writ petition is kept [pending ][for ][a ][considerable ][long period ][of ][time]and finally at a later stage if [the ][Hon'ble ][Supreme ][Court ][conhrms]the decision taken by [this High Court ][as also ][by ][the ][other ][High]Courts in which the [SLPs are ][still ][pending, ][the ][Income ][Tax] .-i Department would get the advantage of the liberty that is otherwiseprotected in favour of the Revenue for initiation of freshproceedings from the disposal ofthese matters at a much later stagewhich would be advantageous and beneficial to the Revenue andwould be equally disadvantageous and detrimental so far as interestof the assesses are concemed. As a consequence, the Income TaxDepartment gets an extended period of time for initiation of freshproceedings.which would be advantageous and beneficial to the Revenue andwould be equally disadvantageous and detrimental so far as interestof the assesses are concemed. As a consequence, the Income TaxDepartment gets an extended period of time for initiation of freshproceedings. 12. The alarming trend of docket explosion in this Court, despitethe clear precedent set in Kanakala Ravindra Reddy (l supra), is amatter of grave concem. The Income Tax Department,s persistentinitiation of fresh proceedings, disregarding the established judicialpronouncements, has led to an unprecedented surge in litigationwith over 600-700 petitions piling up on the same issue. Thisdeliberate approach not only undermines the principle ofjudicialprecedent but also strains the judicial resources unnecessarily. TheDepartment's strategy of awaiting the Supreme Court,s decision onpending SLPs while continuing to initiate fresh proceedingsappears to be a calculated move to buy time and circumventlimitation periods, rather than adhering to the established legal position. Such [conduct raises ][serious questions ][about ][the]administrativeefficiencyandtherespectforjudicialpronouncements, [particularly ][when ][this Court ][has ][already ][provided]a balanced [approach ][by ][preserving ][both ][the ][Revenue's ][rights ][and]assesses [interests] position. Such [conduct raises ][serious questions ][about ][the]administrativeefficiencyandtherespectforjudicialpronouncements, [particularly ][when ][this Court ][has ][already ][provided]a balanced [approach ][by ][preserving ][both ][the ][Revenue's ][rights ][and]assesses [interests] 13. Another [aspect ][which ][needs ][to be considered is ][that ][in ][fact ][it]should [have been ][realized ][by ][the Income ][Tax ][Department ][itself ][and]should [have found ][out ][via ][media ][in ][ensuring ][that ][proceedings]under Sections [148-A and ][148 should ][not ][have been issued ][in ][a]faceless [manner, at ][Ieast ][till ][the ][Hon,ble ][Supreme ][Court ][decide ][the]twelve hundred [(1200)'odd ][SLPs ][which ][it ][is ][already ][seized ][of or' ][at]least the [Income ][Tax ][Department should have ][found ][out ][some]remedial [steps ][to ][ensure ][that ][wherever ][the ][authorities intend ][to]initiate [proceedings ][under Sections 148-A and ][148' ][other ][than ][in ][a]faceless [manner, ][the ][proceedings ][should have been ][deferred]without [precipitating the ][matter ][further ][intimating ][the ][assessee ][that]they shall [initiate ][appropriate proceedings ][onty after ][the SLP's ][are]decided by [the ][Hon'ble ][Supreme ][Court on the ][very ][same ][issue']This again, [the ][Income ][Tax Department' ][has ][not ][been able ][to give ][a]convincing [reply, ][except ][for ][the ][fact that ][such ][a decision ][if ][at ][all] x has to be taken, has to be taken for the whole ot. India, and whichotherwise has to be by way of a policy decision and that too at thelevel of Central Board of Direct Taxes. Though the learnedStanding Counsel for the Income Tax Department contended thatthe Delhi High Court dismissed a writ petition of similar nature, onthe one hand when the High Court is struggling to reduce itspendency, such notices which are under challenge in this writpetition are forcing the assessee to knock the doors of this HighCourt resulting in filing ofhundreds of new writ petitions which inthe long run not only hffects the disposal of the writ petitions butalso consumes substantial time of the Bench in hearing thesematters again and again on daily basis. Admittedly, in spite of thematter before the Hon,ble Supreme Court having been taken onmany occasions, the Hon'bre supreme court which is seized of thematter has b.een reluctant in granting any interim protection to theIncome Tax Department. yet, the authorities concerned at theState level are not ready to accept the verdict passed by a majorityof High Courts of different States on the same issue, and to makethings further worse, the Income Tax Department is showingaudacity by issuing notices continuously under Sections l4g-A and Officer [whereas ][it ][ought] 148 through [the ][jurisdictional ][Assesstng]to have [been ][only ][in ][the ][faceless ][manner'] ASSTSTANT14. In [the ][case ][of ] [vs]COMMISSIONER, [INCOME TAX1l' ][on ][an issue ][whether ][it ][was]onthe part [of ][the ][lncome][ Tax ][DePartment ][in ][not]justifiablefollowing [an ][order ][passed ][by ][the ][adjudicating authority ][only ][on ][the]ground [that ][the ][appeals ][are ][pending' ][the ][Division ][Bench ][of ][the]High [Court ][of ][Bombay held ][at ][paragraph ][No'25 ][as ][under' ][viz'' ][:] Officer [whereas ][it ][ought] 148 through [the ][jurisdictional ][Assesstng]to have [been ][only ][in ][the ][faceless ][manner'] ASSTSTANT14. In [the ][case ][of ] [vs]COMMISSIONER, [INCOME TAX1l' ][on ][an issue ][whether ][it ][was]onthe part [of ][the ][lncome][ Tax ][DePartment ][in ][not]justifiablefollowing [an ][order ][passed ][by ][the ][adjudicating authority ][only ][on ][the]ground [that ][the ][appeals ][are ][pending' ][the ][Division ][Bench ][of ][the]High [Court ][of ][Bombay held ][at ][paragraph ][No'25 ][as ][under' ][viz'' ][:] '25. Mr. Paridwalla [has ][rightly drawn ][out ][attention ][to ][the]decision [of ][this Court in ][Commissioner ][of ][lncome ][Tax ][vs' ][Smt']Godavaridevi [Saraf'2 ][as ][also ][the ][recent ][decision ][of ][the ][co-]ordinate [Bench ][of ][this Court in ][Samp ][Furniture ][(P) ][Ltd' ][v' ][lTO13]of which [one of us (Justice G ][s ][Kulkarni) was ][a ][member' wherein]the Court [categorically observed ][that ][the ][Revenue ][having ][not]"accepted" [the ][judgment of the High Court would not mean ][that till]the same [is set aside in a manner known ][to law' ][it ][would loose ][its]binding [force ][Referring ][to ][the decision of the ][Supreme ][Court ][in]Union [of lndia ][vs' ][Kamlakshi Finance Corporation ][Ltd'14' the]Court [observed ][that the ][approach ][of the ][officials ][of ][Revenue of]treating [decisions being ]["not ][acceptable" ][was ][criticized ][by ][the]Supreme [Court' ][ln ][such ][decision' following ][are the ][relevant]observations [made ][by ][the Supreme Court'] ', [l(2025) ][[70 ][taxmann.com 422 ][(Bombay)l] ,, iisu sl u3 ITR 589 (Bombav) " 1z0z+1 [165 ][taxmann.com ][581/300 ][Taxman ][452 ][(Bombav)][[433 ]][(SC)][[433 ]][(SC)] 1z0z+1 'o irsszl [taxmann.com ][16155ELT ][[433 ]][(SC)] ', [l(2025) ][[70 ][taxmann.com 422 ][(Bombay)l] ,, iisu sl u3 ITR 589 (Bombav) " 1z0z+1 [165 ][taxmann.com ][581/300 ][Taxman ][452 ][(Bombav)][[433 ]][(SC)][[433 ]][(SC)] 1z0z+1 'o irsszl [taxmann.com ][16155ELT ][[433 ]][(SC)] "6. Sri Reddy is perhaps right in saying that theomcers were not actuated by any mala fides inpassing the impugned orders. They perhapsgenuinely felt that the claim of the assessee was notgenuinely felt that the claim of the assessee was nottenable and that, if it was accepted, the Revenuewould suffer. But what Sri Reddy overlooks is that weare not concerned here with the conectness orotherwise of their conclusion or of any factualmalafides but with the fact that the officers, in reachingin their conclusion, by-passed two appellate orders inare not concerned here with the conectness orotherwise of their conclusion or of any factualmalafides but with the fact that the officers, in reachingin their conclusion, by-passed two appellate orders inregard to the same issue which were placed beforethem, one of the Collector (Appeals) and the other ofthe Tribunal. The High Court has, in our view, righflythem, one of the Collector (Appeals) and the other ofthe Tribunal. The High Court has, in our view, righflycriticized this conduct of the Assistant Collectors andthe harassment to the assessee caused by the failureof these gfficers to give effect to the orders ofauthorities higher to them in the appellate hierarchy. ltthe harassment to the assessee caused by the failureof these gfficers to give effect to the orders ofauthorities higher to them in the appellate hierarchy. ltcannot be too vehemently emphasized that it is ofutmost importance that, in disposing of thequasijudicial issues before them, revenue officers arequasijudicial issues before them, revenue officers arebound by the decisions of the appellate authorities.The order of the Appellte Collector is binding on theThe order of the Appellte Collector is binding on theAssistant Collectors working within his jurisdiction andthe order of the Tribunal is binding upon the AssistantCollectors and the Appellate Collectors who functionunder the [jurisdiction ]of the Tribunal. The principles ofjudicial discipline require that the orders of the higherappellate authorities should be foltowed unreservedlythe order of the Tribunal is binding upon the AssistantCollectors and the Appellate Collectors who functionunder the [jurisdiction ]of the Tribunal. The principles ofjudicial discipline require that the orders of the higherappellate authorities should be foltowed unreservedlyby the subordinate authorities. The mere fact that theorder of the appellate authority is not "acceptable" tothe department - in itself an objectionable phrase -and is the subject matter of an appeal can fumish noorder of the appellate authority is not "acceptable" tothe department - in itself an objectionable phrase -and is the subject matter of an appeal can fumish noground for not following it unless its operation hasbeen suspended by a competent court. lf this healthy rule is not followed, the [result ][will ][only ][be ][undue]harassment to assesses and [chaos ][in ][administration]of tax laws. rule is not followed, the [result ][will ][only ][be ][undue]harassment to assesses and [chaos ][in ][administration]of tax laws. 12. We have dealt with this [aspect ][at ][some ][length,]because it has been suggested [by the ][learned]Additionat Solicitor General [that the ][observations]made by the High Court, [have been harsh ][on ][the]officers. lt is clear that the [observations ][of the ][High]Court, seemingly [vehement, ][and ][apparently]unpalatable to the [Revenue, are ][only ][intended to curb]a tendency in revenue [matters ][which, ][if ][allowed ][to]become widespreqd, could [result ][in ][considerable]harassment to the assesses-public [without any benefit]to the Revenue. We [would ][like ][to ][say ][that ][the]department should take [these ][observations ][in ][the]proper spirit. The observations of the [High ][Court]should be kept in [mind ][in ][future ][and the utmost ][regard]should be [paid ]by the [adiudicating authorities and ][the]appellate authorities to [the ][requirements ][of ][judicial]discipline and the [need ][for giving effect ][to ][the ][orders]of the higher appellate authorities [which ][are ][binding]on them." 1 5. What is worrying this [Bench ][more ][is ][the fact ][that ][an]endeavour is being made [whole heartedly to ][ensure ][not to ][generate]further litigation on [issues ][which ][have been ][laid ][to ][rest ][by ][a ][large]number of High Courts [all ][of ][whom have taken a ][consistent ][stand]that the action of the Income [Tax ][Department being ][violative ][of ][the] t.j Finance Act,2020 and Finance Act,2021. Now, in order to protectthe interest of the Revenue as also that of the assessee, it would betrite at this juncture, if we dispose of the writ petition with anobservation/direction that the disposal of the instant writ petition interms of the judgment rendered by this High Court in the case ofKankunala Ravindra Reddy (l supra) shall however be subject totrite at this juncture, if we dispose of the writ petition with anobservation/direction that the disposal of the instant writ petition interms of the judgment rendered by this High Court in the case ofKankunala Ravindra Reddy (l supra) shall however be subject tothe outcome of the SLPs which were filed by the Income TaxDepartment and which is pending consideration before the Hon,bleDepartment and which is pending consideration before the Hon,bleSupreme Court. 16. ln the given facts and circumstances, this Bench is of theconsidered opinion that unless and until we do not timely disposeof matters which are squarely covered by the decision of this Courtand which stands fortified by the decisions of the various otherHigh Courts on the very same issue, the pendency of this HighCourt would further be burdened which otherwise can be decidedand disposed of as a covered matter. 17. So far as the interest of the Revenue is concemed, we are of the considered opinion that the interest of the Revenue has alreadybeen considered and protected, as has been observed in paragraphsbeen considered and protected, as has been observed in paragraphs IIII 36,37 atd38 ofthe [order ][which, ][for ][ready reference, ][is ][reproduced] hereunder: 36 For all the [aforesaid reasons, ][the ][impugned notices]issued and the [proceedings ][drawn by ][the ][respondent-]Department is [neither ][tenable,. ][nor ][sustainable']The notices so [issued ][and the ][procedure ][adopted ][being]per se illegal, deserves to be and [are ][accordingly ][set]aside/quashed. [As ]a [consequence, ][all ][the ][impugned]orders [getting quashed, the consequential orders passed]by the respondent-Department [pursuant ][to ][the ][notices]issued under Section [147 ][and ][148 ][would ][also ][get]quashed and it is ordered accordingly. [The ][reason ][we]are [quashing the consequenlial ][order ][is ][on ][the ][principles]that when the initiation [of ][the ][proceedings ][itself ][was]procedurally wrong, the subsequent [orders also ][gets]nullified automaticallY. 36 For all the [aforesaid reasons, ][the ][impugned notices]issued and the [proceedings ][drawn by ][the ][respondent-]Department is [neither ][tenable,. ][nor ][sustainable']The notices so [issued ][and the ][procedure ][adopted ][being]per se illegal, deserves to be and [are ][accordingly ][set]aside/quashed. [As ]a [consequence, ][all ][the ][impugned]orders [getting quashed, the consequential orders passed]by the respondent-Department [pursuant ][to ][the ][notices]issued under Section [147 ][and ][148 ][would ][also ][get]quashed and it is ordered accordingly. [The ][reason ][we]are [quashing the consequenlial ][order ][is ][on ][the ][principles]that when the initiation [of ][the ][proceedings ][itself ][was]procedurally wrong, the subsequent [orders also ][gets]nullified automaticallY. 37. The [preliminary objection raised ][by ][the ][petitioner ][is]sustained and alt [these ][writ ][petitions stands allowed ][on]this very [jurisdictional ][issue. Since ][the ][impugned notices]and orders are [gefting quashed ][on the ][point ][of]jurisdiction, we are not inclined to [proceed ][further ][and]decide the other issues [raised ][by the ][petitioner ][which]stands reserved to [be ][raised ][and ][contended ][in ][an]appropriate [proceedings.] 38. Since [the Hon'ble Supreme Court had, ][in ][the ][case]of Ashish Agarwal, [supra, ][as ][a ][one-time ][measure]exercising the [powers ][under ][Article ][142 ][of ][the]Constitution of [lndia, ][permitted ][the ][Revenue ][to ][proceed]under the [substituted provisions, ][and ][this Court allowing]the [petitions ][only ][on ][the ][procedural ][flaw, ][the ][right] '7 conferred on the Revenue would remain reserved toproceed further if they so want from the stage of theorder of the Supreme Court in the case of AshishAgarwal, supra.order of the Supreme Court in the case of AshishAgarwal, supra. 18. we would only further like to make observations that sincewe are inclined to dispose of the instant writ petition, conscious ofthe fact that the earlier order of this High Court in the case ofKanakala Ravindra Reddy (l supra) is subjected to challengebefore the Hon,ble Supreme Court in SLp No.3574 of 2024,preferred by the.Income Tax Department, we make it clear thatallowing of the instant writ petition is subject to outcome of theaforesaid SLp prefened by the Revenue against the decision ofthisHigh Court in the case of Kanakalu Ravindra Reddy (1 supra).This, in other words, would mean that either of the parties, if theyso want, may move an appropriate petition seeking revival of thiswrit petition in the light of the decision of the Hon,ble SupremeCourt in the pending SLp on the very same issue. t9.Accordingly, the instant writ petition instant writ petition writ petition petition stands allowed in allowed ininfavour of the assessee so far as the issue of jurisdictionlsconcemed. As aconsequence, the impugned notice underchallenge under Sections l4g_A and l4g stands set aside/quashed.challenge under Sections l4g_A and l4g stands set aside/quashed. Accordingly, the instant writ petition instant writ petition writ petition petition stands allowed in allowed inin \ The consequential orders, if any, also [stand set ][aside/quashed ][in]similar terms as have [been ][passed ][by ][this ][High ][Court ][in ][the ][case ][of]Kankanala Ravindra [Reddy ][(l ][supra). ][There shall ][be ][no order ][as]to costs Consequently, miscellaneous [petitions ][pending, ][if ][any, shall]stand closed. t9.Accordingly, the instant writ petition instant writ petition writ petition petition stands allowed in allowed ininfavour of the assessee so far as the issue of jurisdictionlsconcemed. As aconsequence, the impugned notice underchallenge under Sections l4g_A and l4g stands set aside/quashed.challenge under Sections l4g_A and l4g stands set aside/quashed. Accordingly, the instant writ petition instant writ petition writ petition petition stands allowed in allowed inin \ The consequential orders, if any, also [stand set ][aside/quashed ][in]similar terms as have [been ][passed ][by ][this ][High ][Court ][in ][the ][case ][of]Kankanala Ravindra [Reddy ][(l ][supra). ][There shall ][be ][no order ][as]to costs Consequently, miscellaneous [petitions ][pending, ][if ][any, shall]stand closed. SD/-M. NAGAMANISISTANT REGISTRAR//TRUE COPY//SECTION OFFICERTo1.The lncome Tax Officer Ward [1 ], Adilabad/ AdilabaHyderabad, Adilabad,Hyderabad, Hyderabad 504106, Telangana.2.The Principal Chief Commissioner of lncome Tax, Telangana and A.P,Hyderabad, lT Towers, AC Guards, Masab Tank, Hyderabad - 500028,Telangana.J.The Chairman, Central Board of Direct Taxes, Department of Revenue,-Ministry of Finance, Government of India, Secretariat Buildings, New Delhi 't 10 001 .4.The National Faceless Assessment Center, lncome Tax Department, NewDelhi.5.The Secretary to the Government, Union of lndia, Department of Revenue,Ministry of Finance, New Delhi - ['1 ]10 001 .6.One CC to SRI THANNERU CHAITANYA KUMAR, Advocate 7.One CC to Ms. J.SUNITHA (JUNIOR SC FOR INCOME TAX) AdvocateIoPUCI8.One CC to SRI B.MUKHERJEE, LEARNED COUNSEL REPRESENTINGUNION OF lNDlA, Advocate (OPUC)oTwo CD CopiesSALS HIGH COURT DATED:2810412025 ORDER WP.No.33444 ot [2024] ALLOWING [W.P]WITHOUT COSTS. 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