Wp/34335/2024 Of Primary Agricutural Co Operative Society Limited v. The Income Tax Officer Ward 1

HIGH COURT AT HYDERABAD(SPecial Original [Jurisdiction)] MONDAY ,THE TWO THOUSAND PRESENTTHE HONOURABLE [SRI JUSTICE P.SAM KOSHY]ANDTHE HONOURABLE [JUSTJ'E ] WRIT PETITION [NO:][ 34335][ oF ][2024] Between: PRIMARY [cq ][o-PERATIVE ][soclETY ][LIMITED']GUDIHATHNooR, [Ti#'ilil"" ][dEo ][rENr-one ][pnruoRnt' ][s/o' ] . . [c)ccrroation' ][Business' ][Rr/o']KENDRE, [Aged ][';[";i ]['";i-t"-;at ]cu DTHATHNOOn [p,'b"ribr ][niiHr.r60n' ][ru, ][-c,rir ][HnrnNooR' ] t04o0i, [Telangana, lndib. Assessment ][Year' ][2016-17] ...PETITIONER AND 1The lncome [Tax ][Officer ][Ward ][1, ][Adilabad Adilabad' Hyderabad' ][Hyderabad]2?flttoB#'r3?"En'"t [commissioner ][of ][lnccme ][Tax-relansana ][' ][and]AP,Hyderabad [lT ][rowers ][: ][ ["d;;;' ][il"ju ][iint' ][Hvderabad--s000028']2?flttoB#'r3?"En'"t [commissioner ][of ][lnccme ][Tax-relansana ][' ][and]AP,Hyderabad [lT ][rowers ][: ][ ["d;;;' ][il"ju ][iint' ][Hvderabad--s000028']3If;f[%1{ii", Board [of Direct Taxes, Represented.bv its ][chairman, ][De-partment];i'h;;;;;, [Min-iitw ][ot ][Fin;#":t;;Sinmeni ][ot ][lhd ][ia' ][Secretariat Buildinss']New Delhi [- ][110 ][00'1 ][.];i'h;;;;;, [Min-iitw ][ot ][Fin;#":t;;Sinmeni ][ot ][lhd ][ia' ][Secretariat Buildinss']New Delhi [- ][110 ][00'1 ][.]4The National [Faceless Assessment ][Center' ][lncome ][Tax ][Department' ][New]u. ?frI' [un,on ][of ][lndia, ][Represented ][by ][its ][secretary ][to ][the ][Government']Department [of Revenue, '[fiL"itt"'v ][ot"rin"nle' ][rtr"* ][ottni ][- ][1 ][10 ][001 ][']u. ?frI' [un,on ][of ][lndia, ][Represented ][by ][its ][secretary ][to ][the ][Government']Department [of Revenue, '[fiL"itt"'v ][ot"rin"nle' ][rtr"* ][ottni ][- ][1 ][10 ][001 ]['] ...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]Utsl4Tr.w.sl44readwithSectionl44Bofthelncome-taxActDateof1 5tO212O24, [tit ][1 ][47 ][t2o23-24l1 ][061 ][005978(1 ][) ][for the ][Assessment]Year2016-lTdeterminingthetotalincomeofRs'1,95,48',l86/-.asarbitrary' illegal, bad in taw without jurisdiction, Constitution natural justice of apart lndia from and being violative Sec. 14gA void_ab-initio,of of Articlesthe lnc 14, violative of the ome Tax 19(1)(9) Act, and 265 of principles .,l961, andtheofco nsequently set aside the same in the interests of justiceIA NO 1oF2024 petition under section 151 cpc praying that in the circumstances statedin the affidavit fired in support of the petition, the High court may be preased toIncome-tax suspend the order Act Date of Under section 147 r-w.s 144 read with section 1448 of the15_02_2024, DtN ITBA/AST/S/14 712023_24r1061005978(1) for the Assessment year 2016-17 determining the total1961' vide income of Rs DrN 1 & 'g5'4g' Notice 1g6/- No. TTBAiAST and Demand notice rst156/2023-24i1061006155(1) Dt. uis 'r 56 0f the rncome Tax 15-02-act2024 for the assessment year 2o1o-17 pending disposar of the above writPetition Counsel for the petitioner: SRt. THANNERU CHAITANYA KUMAR Counsel for the Respondent Nos. 1to3: Ms. J. SUNITHA (JUNtoR SC FOR TNCOME TAX)B. MUKHERJEE MUKHERJEE REp8fl S6i,t',ffJ="?t[Hll5;, *,,^ Counsel for the Respondent Nos.4&S: SRI B. MUKHERJEE MUKHERJEE REp The Court made the following: ORDER THE HONOURABLE [P.SAM ] ANDTHE HONOURABLE NANDTKONDA WRIT PETT [N][o.3433][s ][oR ][2024] ORDER, [(per ][Hon'ble ][Sri ][Justice Narsing ][Rao ][Nandikonda)] Counsel for the petitioner: SRt. THANNERU CHAITANYA KUMAR Counsel for the Respondent Nos. 1to3: Ms. J. SUNITHA (JUNtoR SC FOR TNCOME TAX)B. MUKHERJEE MUKHERJEE REp8fl S6i,t',ffJ="?t[Hll5;, *,,^ Counsel for the Respondent Nos.4&S: SRI B. MUKHERJEE MUKHERJEE REp The Court made the following: ORDER THE HONOURABLE [P.SAM ] ANDTHE HONOURABLE NANDTKONDA WRIT PETT [N][o.3433][s ][oR ][2024] ORDER, [(per ][Hon'ble ][Sri ][Justice Narsing ][Rao ][Nandikonda)] Heard Mr. [Thanneru Chaitanya ][Kumar' ][learned ][counsel]for the [petitioner, ][Ms. ][J'Sunitha, ][learned ][Junior ][Standing ][Counsel]for the [[ncome ][Tax ][Department ][for ][respondent ][Nos'l ][to ][3 ][and]Mr. B. Mukherjee, [Iearned ][counsel representing ][the ][Union ][of ][India]for respondent [No.4. ][Perused the ][record'] This is a is a a [[writ ][petition ]][[petition ]][[where ]][[the ][proceedings ]][[proceedings ]][[are ][either]][[either]] 2. This is a is a a [[writ ][petition ]][[petition ]][[where ]][[the ][proceedings ]][[proceedings ]][[are ][either]][[either]]challenged [to ][the ][notices ][which ][were ][issued ][under Section ][148A]and 148 [of ][the Income ][Tax ][Act, ][1961 ][(for ][short ]['the ][Act') ][or ][the]assessment [orders ][those ][have ][been passed ][under ][Section ][147 ][of]the Act [which ][have been assailed'] This writ [[petition ]][[is ][being ][taken up today ]][[being ][taken up today ]][[taken up today ]][[onty ][on ][one ][of ][the]][[on ][one ][of ][the]][[one ][of ][the]][[of ][the]][[the]] 3. This writ [[petition ]][[is ][being ][taken up today ]][[being ][taken up today ]][[taken up today ]][[onty ][on ][one ][of ][the]][[on ][one ][of ][the]][[one ][of ][the]][[of ][the]][[the]]that [the ][notices ][issued ][under Section ][148,4 ][of ][the Act]grounds, and the subsequent [initiation ][of ][proceedings under ][Section ][148 ][of]the Act by [the. ][jgrisdictional ][Assessing ][Officer' ][whereas ][in ][terms]of the amendment [that ][was ][brought to ][the Income ][Tax ][Act ][by ][way] of Finance Act, 2O2l w.e.f., 0t.04.2021 onwards, proceedingsunder Section 148,4 of the Act as also under Section l4g of theAct ought to have also been issued and proceeded in a facelessmanner4. The contention contention of the petitioner is that the issue the petitioner is that the issue petitioner is that the issue is that the issue that the issue issue ofproceedings being in violation of the Finance Act, 2021 i.e., theimpugned,otices under Section r4gA and section l4g of the Actnot being issued in a faceless manner, have already been dealt withand decided by this Courr in the case of KANKANALARAVINDRA REDDY vs. INCOME-TAX OFFICER, decidedon 14.09.2023 whereby a batch of writ petitions were allowed andthe proceedings initiated under section 14gA as also under Section148 of the Act were held to be bad with consequential reliefs on theground of it being in violation of the provisions of Section l51A ofthe Act read wirh Norification lgl2022 dated 29.03.2022. The saidjudgment passed by this court has also been subsequently followedin a large number of writ petitions which were allowed on similarterms The contention contention of the petitioner is that the issue the petitioner is that the issue petitioner is that the issue is that the issue that the issue issue of '[(2023) 156 taxmann.com l7g (Telangana)] J The contention contention of the petitioner is that the issue the petitioner is that the issue petitioner is that the issue is that the issue that the issue issue of '[(2023) 156 taxmann.com l7g (Telangana)] J 5. Down the [line, ][we ][find ][that ][the ][same ][issue has also ][been]decided against [the ][Revenue ][by ][various ][High ][Courts ][i'e'']the [Bombay ][High ][Court ][in ][the ][case ][of ] by TECHNOLOGIES [LTD', ][vs' ] OF INCOME [& ][OTHERS2, ][Gauhati ][High Court ][in ][the ][case]of RAM NARAYAN [SAH vs' ][UNION OF INDIAs' ][Punjab ][and]Haryana [High Court ][in ][the ][case ][of ] vs. UNION [OF INDIA4, ][and Telangana ][High ][Court ][in ][the ][case ][of]SRI VENKATARAMANA [VS. ] COMMISSIONER [where the ][issue ][was in]of [international taxation, Bombay ][High ][Court ][in ][the ][case ][of]respect ABHIN ANILKIMAR [VS. ] [OFFICE&]INTERNATIONAL [which is ][again ][on ][international]taxation and [central ][circle, High ][Court ][of ][Himachal ][Pradesh ][in ][the]case of GOVIND [vs' ] [OFFICERT']Gujarat High [Court ][in ][the ][case ][of ] ' lzoz+1 [464 ] [430 ][(Bom)]'iQOZi) [156 ][taxmann.com 478 ][(Gauhati)l]" l(2024) [165 ][taxmann.com ] [15 ][(Punjab ][& ][Haryana)l]' L2024) [67 ][taxmann.com ][41 ] [(Telangana)l]'12024) [166 ][taxfiarfl'com ][679 ][(Bombay)l]' iiOZql [1 ][6 ][5 ][taxmann. ][com ][1 ][1 ][3 ][(Himachal ][Pradesh)l] DAHYABHAI RADADIYA vs. INCoME TAx OFFICER,WARD 3(3X5)8, Jharkand High Courr in the case of SHyAMSUNDAR SAW vs. UNION OF INDIAe, Rajasthan High Court inthe case ol SHAR-DA DEVI CHHAJER vs. INCOME TAXOFFICER & ANOTHER and batch of writ petitionsl0 whichstood decided on 19.03.2024. Similar view's have also been takenby the Division Bench of Calcutta High Court in the case ofGIRDHAR GOPAL DALMIA vs. UNION OF INDIA & ORS(M.A.T 1690 of 2023), decided on25.09.2024.6. Even though the same issue having been decided by a largenumber ol High Courts, rve are still confronted with large filing ofidentical matters on daily basis ranging between 5 to trO witpetitions. That upon the instructions being sought from theDepartment, they have been taking a solitary ground that thedecision of the Bombay High Court in the case of lfexawareTechnologies Ltd., (Z supra) as also the one which has beendecided by this Court in the case of Kanakakt Ravindra Reddy t202{scc online Guj 4012'2025 SCC Online Jhar2B:-to 72023 [: ]RI-JD : 498 4-DBl ) t202{scc online Guj 4012'2025 SCC Online Jhar2B:-to 72023 [: ]RI-JD : 498 4-DBl ) (1 supra) [has ][been ][subjected ][to ][challenge ][in ][a ][Special ][Leave]Petition [i.e, ] [No'3574 ][of ][2024 ][before the ][Hon'ble ][Supreme]court [and ][the ][Hon,bre ][Supreme ][court ][is ][seized ][of ][the ][matter']ln addition, [there are ][about ][1200 SLPs also ][filed ][arising out ][ofthe]same [issue ][betng][ decided ][bY ][various ][High ][Courts']7. To a [query ][being put ][to ][the ][learned counsel ][for the ][Revenue']they [have ][categorically ][accepted ][the fact ][that ][there ][is ][no ][interim]order [granted ][by ][the ][Hon'ble ][Supreme ][Court ][in ][any ][of ][these]matters [pending ][betbre ][it' ][Meanwhile' fresh ][writ ][petitions ][of]identicar [narure ][are ][being piled ][up before ][this ][Bench ][on ][daily ][basis]and [the ][pendency ][is ][getting ][increased ][on ][matter ][which ][otherwise]has [already ][been ][dealt ][and decided ][by ][this very ][High ][Court ][itself']On [the ][one ][hand' ][even though ][the ][order ][of ][this ][Court ][that]8. was [passed ][as ][early ][as ][on ][14'09'2023 and ][more ][16 months ][have]lapsed, [till ][date' ][we do ][not ][find ][any ][remedial ][steps ][having ][been]taken [by ][the Income ][Tax ][Department ][to ][take appropriate ][steps ][to]either [hold back ][issuance ][of ][notice ][under Section 148A ][and under]Section [14g ][of ][the ][Act ][by ][the ][jurisdictional ][Assessing ][officer']rather [the authorities ][concerned ][in ][the teeth ][of ][series ][of ][decisions] *.-.-.--.:_:: by all the major High Courts in India are continuously stillinitiating proceedings under Section 14gA of the Act and alsoinitiating proceedings under Section l4g of the Act incontravention to the amendments brought into the Income Tax Actpursuant to the Finance Act,2020 as also the Finance Act202l. 9' upon a query being put as to why can't this writ petition bedisposed of in the teeth of the decision rendered by this Court inthe case of Kanakala Ruvindra Reddy (l supra), Ieamed StandingCounsel for the Income Tax Department contends that those wouldunnecessarily burden the Income Tax Department where theywould be required to file equal number of SLps before theHon'ble Supreme Court and it would be further burdening theexchequer of the Union of India. It was also the contention of theleamed Standing Counsel that no prejudice would be caused to theinterest of the petitioners in case if this writ petition is kept pendingtill the finalization of the SLps pending before the Hon,bleSupreme Court and the fact that the petitioner is already enjoyingthe benefit of interim protection. Nonetheless, on the earlier queryof this Court as to why the Income Tax Department have not comeout with a mechanism to issue appropriate instructions or to take a 'l appropriate [steps ][in ][ensuring ][that proceedings ][under Section 148,{]of the Act as [also ][the ][assessment ][orders ][under Section ][148 ][of ][the]Act are kept [in ][a ][hold ][in ][the ][light ][ofthe ][decisions dedcided ][by ][the]various High [Courts, ][it ][was ][submitted ][by ][the ][leamed ][Standing]Counsel that [the ][said ][steps ][can ][only ][be ][taken ][at ][the ][level ][of ] as any such steps [would ][have ][to be ][taken Pan ][India ][and cannot ][be]limited to any of [these ][jurisdictional ][High ][Courts.] a 'l appropriate [steps ][in ][ensuring ][that proceedings ][under Section 148,{]of the Act as [also ][the ][assessment ][orders ][under Section ][148 ][of ][the]Act are kept [in ][a ][hold ][in ][the ][light ][ofthe ][decisions dedcided ][by ][the]various High [Courts, ][it ][was ][submitted ][by ][the ][leamed ][Standing]Counsel that [the ][said ][steps ][can ][only ][be ][taken ][at ][the ][level ][of ] as any such steps [would ][have ][to be ][taken Pan ][India ][and cannot ][be]limited to any of [these ][jurisdictional ][High ][Courts.] 10. As a [result ][of ][which, ][what ][we ][are ][facing ][is ][steep increase ][of]litigation day in and [day out ][even ][though various ][orders ][have been]passed by this High Court [allowing ][writ ][petitions ][on the ][very ][same]issue. The [Income ][Tax ][authorities ][concerned are ][still ][even ][now in]2025 also [initiating ][proceedings ][in ][contravention ][to ][the ][provisions]of Section l51A [of ][the ][Act ][and ][as ][a result ][by ][now, ][more than 600]to 700 [petitions ][have been already ][got ][piled ][up before this High]Court on an [issue ][which ][otherwise ][stands ][squarely ][covered ][by ][the]judgment of this Court in the case of Kanakala [Ravindra ][Reddy](1 supra). What is also surprising [is ][the fact that ][though ][while]allowing [the ]writ [petitions ][in ][the ][case ][of ][Kanakala ][Ravindra]the Division [Bench ][while ][reseruing ][the ][right ][of]Reddy (l supra), the Revenue, has also [protected ]the [interest ][of ][the ][petitioners] insofar as the lib.;:-;,; .,vhicir -,.zas granted to the Revenue iirrnrtiating fresh proceedings strictly in accordance with the amendedprovisions of the Act, as amended by the Financ e Act, 2020 andthe Finance Act,202r. The petitioner assessee wourd be entitled tochallenge or raise the other legal objections if the Revenue initiatesfiesh proceedings. The Department has made no endeavour inavailing the said liberty that was reserved for the Revenue. On thecontrary, they have been still sticking on ro the stand, which thisHigh Court as well as many other High Courls already held to bebad. I L It appears that because ofthe aforesaid liberty that this HighCourt had liberty that this HighCourt had granted permitting the Revenue for initiating freshproceedings as a one_time measure in a faceless manner, theinitiating freshproceedings as a one_time measure in a faceless manner, theIncome Tax Department wants to take advantage of the same byprotracting these proceedings which would enable them to meet thelimitation that would otherwise come in the way. Likewise, if thewrit petition is kept pending for a considerable protracting these proceedings which would enable them to meet thelimitation that would otherwise come in the way. Likewise, if thewrit petition is kept pending for a considerable long period of timeand finally at alater stage if the Hon,ble Supreme Court confirmsand finally at alater stage if the Hon,ble Supreme Court confirmsthe decision taken by this High Court as also by the other HighCourts in which the SLps are still pending, the Income Tax Department would [get ]the advantage [of ][the ][liberty ][that ][is'otherwise]protected in favour of the Revenue for initiation of [fresh]proceedings from the disposal ofthese [matters ][at ][a ][much later ][stage]which would be advantageous and [beneficial ][to ][the ][Revenue ][and]would be equally disadvantageous [and ][detrimental ][so ][far ][as ][interest]of the assesses are concemed. [As a ][consequence, ][the Income Tax]Department gets an extended [period ][of time for initiation ][of ][fresh]proceedings.12. The alarming trend of docket [explosion in this Court, ][despite]the clear precedent setin Kunakala [Ravindra ][Reddy ][(l ][supra), ][is ][a]matter of grave concern. The [Income ][Tax ][Department's ][persistent]initiation of fresh proceedings, [disregarding the ][established ][judicial]pronouncements, has led to an unprecedented [surge ][in ][litigation]with over 600-700 petitions [piling ]up [on ][the ][same ][issue. ][This]deliberate approach not only [undermines the ][principle of judicial]precedent but also strains the [judicial ][resources ][unnecessarily. ][The]Department's strategy of awaiting [the ][Supreme ][Court's decision ][on]pending SLPs while continuing to initiate [fresh ][proceedings]appears to be a calculated move to buy time [and ][circumvent]limitation periods, rather than adhering to the [established ][legal] \\ \'\ position. Such conduct raises serious questions about theadministrative efficiency and the respect for judicialpronouncements, particularly when this Court has already provideda balanced approach by preserving both the Revenue,s rights andassesses lnterests. 13. Another aspect which needs to be considered is that in fact itshould have been realized by the Income Tax Department itseiiandshould have found out via media in ensuring that proceedingsunder Sections l4g-A and l4g should not have been issued in afaceless manner, at least tilt the Hon,ble Supreme Court decide thetwelve hundred (1200) odd SLps which it is already seized ofor, atleast the Income Tax Department should have found out someremedial steps to ensure that wherever the authorities intend toinitiate proceedings under Sections I4g_A and l4g, other than in afaceless manner, . the proceedings should have been deferrerlwithout precipitating th€ matter fufther intimating the assessee thatthey shall initiate appropriate proceedings only after the SLp,s aredecided by the Hon,ble Supreme Court on the very same issue.This again, the Income Tax Department, has not been able to give aconvincing reply, except for the fact that such a decision if at all has to be taken, [has ][to ][be ][taken ][for ][the whole ][of ][India' ][and ][which]otherwise has [to ][be ][by ][way ][of ][a ][policy ][decision ][and ][that too ][at the]level of Central [Board ][of ][Direct ][Taxes' ][Though ][the ][leamed]Standing [Counsel ][for ][the ][Income ][Tax ][Department ][contended that]the Delhi [High ][Court ][dismissed ][a ][writ ][petition ][of ][similar ][nature' ][on]the one [hand ][when ][the ][High ][Court ][is ][struggling ][to ][reduce ][its]such [notices ][which ][are ][under challenge ][in ][this ][writ]pendency, petition are forcing [the ][assessee ][to ][knock ][the doors ][of ][this ][High]Court resulting [in ][filing ][of ][hundreds ][of ][new ][writ ][petitions ][which in]the long [run not ][only ][affects the disposal ][of ][the ][writ ][petitions but]also consumes [substantial ][time ][of ][the ][Bench ][in ][hearing ][these]matters again and [again ][on ][daily ][basis' ][Admittedly' in ][spite ][of ][the]matter before [the ][Hon'ble ][Supreme ][Court ][having ][been ][taken ][on]many occasions, [the ][Hon'ble ][Supreme ][Court ][which ][is ][seized ][of ][the]matter has been [reluctant ][in ][granting any ][interim protection ][to ][the]Income Tax [Department. ][Yet, ][the ][authorities ][concemed ][at ][the]State level are [not ][ready ][to ][accept ][the verdict ][passed ][by ][a ][maj ][ority]of High Courts of [different ][States ][on the ][same ][issue; and ][to ][make]things further [worse, ][the ][Income ][Tax ][Department ][is ][showing]audacity by issuing [notices ][continuously ][under Sections ][148-4 ][and] 148 through the jurisdictional Assessing Officer whereas it oughtto have been only in the faceless manner. 14. In the case of BANK OF INDIA vs. ASSISTANTCOMMISSIONER, INCOME TAXn, on an issue whether ir wasjustifiable on the part of the Income Tax Department in notfollowing an order passed by the adjudicating authority only on theground that the appears are pending, the Division Bench of theHigh Court of Bombay held at paragraph No.25 as under, viz., : "25. IVlr. [paridwalla ]has righfly drawn out attention to thedecision of this Court in Commissioner of lncome Tax vs. Smt.Godavaridevi Sarafl2 as also the recent decision of the co-ordinate Bench of this Court in Samp Furniture (p) Ltd. v. lTOi3of which one of us (Justice G.S. Kulkarni) was a member, whereinthe Court categorically observed that the Revenue having not"accepted" the judgment of the High Court would not mean that tillthe same is set aside in a manner known to law, it would loose itsbinding force. Referring to the decision of the Supreme Court inUnion of lndia vs. Kamlakshi Finance Corporation Ltd.,4, thecourt observed that the approach of the officiars of Revenue oftreating decisions being [,.not ]acceplable,, was criticized by theSupreme Court. ln such decision, following are the relevantobservations made by the Supreme Court. ',', y1r232l o r,,mann.com 422 (Bombay)l" [1978] .r, I I3 ITR 589 (Bombay)" [1978] .r, I I3 ITR 589 (Bombay) ','.[20241 165 raxmann.com 5gl/300 Taxman 452 (Bombay)5gl/300 Taxman 452 (Bombay) 'o ]t9921taxmaffr.com 16/55 ELT 433 (SC) I -l '.'. \I iI.'/ ',', y1r232l o r,,mann.com 422 (Bombay)l" [1978] .r, I I3 ITR 589 (Bombay)" [1978] .r, I I3 ITR 589 (Bombay) ','.[20241 165 raxmann.com 5gl/300 Taxman 452 (Bombay)5gl/300 Taxman 452 (Bombay) 'o ]t9921taxmaffr.com 16/55 ELT 433 (SC) I -l '.'. \I iI.'/ "6. Sri Reddy is perhaps [right ][in ][saying ][that ][the]officers were [not ][actuated ][by ][any ][mala fides ][in]passing the impugned orders. [They ][perhaps]genuinely felt that the claim [of ][the assessee was ][not]tenable and that, [if ][it ][was ][accepted, ][the ][Revenue]would suffer. [But ][what ][Sri Reddy overlooks is that ][we]are not concerned [here ][with ][the ][correctness ][or]otherwise of their [conclusion ][or of ][any ][factual]malafides but [with the ][fact ][that ][the ][officers, in reaching]in their conclusion, [by-passed ][tvvo ][appellate orders ][in]regard to the same [issue which ][were ][placed ][before]them, one of the [Collector ][(Appeals) and the ][other ][of]the Tribunal. The [High Court ][has, in ][our ][view, ][rightly]criticized this conduct [of the Assistant ][Collectors and]the harassment to the [assessee caused ][by the ][failure]of these officers to [give effect ][to ][the ][orders ][of]authorities [higher ][to ][them ][in ][the appellate ][hierarchy ][lt]cannot be too [vehemently emphasized ][that ][it is ][of]utmost importance [that, ][in ][disposing ][of ][the]quasijudicial issues before [them, ][revenue ][officers ][are]bound by the decisions [of ][the ][appellate ][authorities']The order of the [Appellte Collector ][is ][binding ][on ][the]Assistant Collectors [working within his jurisdiction and]the order of [the Tribunal is binding upon the Assistant]Colbctors and the [Appetlate Collectors who ][function]under the iurisdiction [of ][the ][Tribunal. ][The principles ][of]judicial discipline require that the orders [of the ][higher]appellate authorities [should be followed ][unreservedly]by the subordinate [authorities. ][The mere ][fact ][that the]order of the appellate [authority ][is ][not ]["acceptable" ][to]the department - [in ][itself ][an ][objectionable phrase ]-and is the subiect [matler of an appeal ][can ][furnish ][no]ground for not following it unless [its ][operation ][has]been suspended by a [competent ][court. ][lf this healthy]!. \-* rule is not foli.,:wecj, lhe result will only be undueharassment to assesses and chaos in administrationof tax laws. 12. We have dealt with this aspect at some length,because it has been suggested by the learnedAdditional Solicitor General that the observationsmade by the High Court, have been harsh on theofficers. lt is clear that the observations of the HighCourt, seemingly vehement, and apparenflyunpalatable to the Revenue, are only intended to curba tendency in revenue matters which, if allowed tobecome widespread, could result in considerableharassment to the assesses_public without any benefitto the Revenue. We would like to say that thedepartment should take these observations in theproper spirit. The observations of the High Courtshould be kept in mind in future and the utmost regardshould be paid by the adjudicating authorities and theappellate authorities to the requirements of judicialdiscipline and the need for giving effect to the ordersof the higher appellate authorities which are bindingon them." 15' what is worrying this Bench more is the fact that anendeavour is being made whole heartedly to ensure not to generatefurther litigation on issues which have been laid to rest by a largenumber of High Courts all of whom have taken a consistent standthat the action of the Income Tax Department being violative of the 15' what is worrying this Bench more is the fact that anendeavour is being made whole heartedly to ensure not to generatefurther litigation on issues which have been laid to rest by a largenumber of High Courts all of whom have taken a consistent standthat the action of the Income Tax Department being violative of the Finance [Act,2020and Finance ][Act'2021' ][Now' inorder ][to ][protect]the interest [of ][the Revenue ][as ][also that ][of ][the ][assessee' ][it ][would ][be]trite at [this juncture, ][if ][we ][dispose ][of ][the ][writ ][petition ][with ][an]observation/direction [that ][the ][disposal ][of ][the instant ][writ ][petition ][in]terms of [the ][judgment ][rendered ][by ][this ][High ][Court ][in ][the ][case ][of]Kankanala [Ravindra ][Reddy ][(l ][supra) ][shatl however be ][subject ][to]the outcome [of ][the ][SLPs ][which ][were frled ][by ][the ][Income ][Tax]Department [and ][which ][is ][pending ][consideration before the ][Hon'ble]Supreme [Court.] 16. In [the ][given ][facts and ][circumstances' ][this ][Bench ][is ][of ][the]considered [opinion ][that ][unless and ][until ][we do ][not ][timely ][dispose]of matters [which ][are ][squarely covered ][by ][the decision ][of ][this ][Court]and which [stands ][fortified ][by ][the ][decisions ][of ][the ][various ][other]Courts [on the very ][same ][issue' ][the ][pendency ][of ][this ][High]High Court [would further ][be ][burdened ][which ][otherwise ][can ][be ][decided]and 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 ][already]been considered [and ][protected, ][as ][has been ][observed ][in ][paragraphs] 36, 37 and 38 of the order which, for ready reference, is reproducedhereunder: 36. For all the aforesaid reasons, the impugned noticesissued and the proceedings drawn by the respondent_Department is neither tenable, nor sustainable.-fhe notices so issued and the procedure adopted beingper se illegal, deserves to be and are accordingly setaside/quashed. As a consequence, all the impugnedorders getiing quashed, the consequential orders passedby the respondent-Department pursuant to the noticesissued under Section [.147 ]and 1 4g would also getquashed and it is ordered accordingly. The reason weare quashing the consequential order is on the principlesthat when the initiation of the proceedings ilself wasprocedurally rvrong, the subsequent orders also getsnullified automatically. 37. The preliminary objection raised by the petitioner issustained and all these writ petitions stands allowed onthis very jurisdictional issue. Since the impugned noticesand orders are getting quashed on the point ofjurisdiction, we are not inclined to'proceed furlher anddecide the other issues raised by the petitioner whichstands reserved to be raisedand contended in anappropriate proceedings. 38Since the Hon,ble Supreme Court had, in the caseof Ashishof AshishAgarwal, supra, as a one{imemeasureexercisingthe powers under Article 142of theConstitution of lndia, permitted the Revenue to proceedunder the substituted provisions, and this Court allowingthe petitions only on the procedural flaw, the rightthe petitions only on the procedural flaw, the right conferred [on ][the ][Revenue ][would ][remain reserved ][to]proceed [further ][if ][they so want ][from the ][stage ][of ][the]order [of ][the ][Supreme ][Court ][in ][the ][case ][of ][Ashish]Agarwal, [suPra] 38Since the Hon,ble Supreme Court had, in the caseof Ashishof AshishAgarwal, supra, as a one{imemeasureexercisingthe powers under Article 142of theConstitution of lndia, permitted the Revenue to proceedunder the substituted provisions, and this Court allowingthe petitions only on the procedural flaw, the rightthe petitions only on the procedural flaw, the right conferred [on ][the ][Revenue ][would ][remain reserved ][to]proceed [further ][if ][they so want ][from the ][stage ][of ][the]order [of ][the ][Supreme ][Court ][in ][the ][case ][of ][Ashish]Agarwal, [suPra] 18. [We ][would only ][further ][like ][to ][make ][observations ][that ][since]we are inclined [to ][dispose ][of ][the instant ][writ ][petition' ][conscious ][of]the fact [that ][the ][earlier order ][of ][this High ][Court ][in ][the ][case ][of]KanakalaRavindraReddy(lsupra)issubjectedtochallengebefore [the Hon'ble ][Supreme ][Court ][in ][SLP No'3574 ][of ][2024']preferred [by ][the ][Income ][Tax Department' we ][make ][it ][clear ][that]allowing [of ][the ][instant ][writ ][petition ][is ][subject ][to ][outcome ][of ][the]aforesaid [SLP preferred ][by ][the Revenue against the decision ][of ][this]Court [in ][the ][case ][of ][Kanakala Ravindra ][Reddy ][(l ][supra\']High in [other words, ][would ][mean ][that either ][of ][the ][parties' ][if ][they]This, so want, [may move an ][appropriate ][petition ][seeking ][revival of ][this]writ [petition ][in ][the ][light of ][the ][decision ][of ][the ][Hon'ble ][Supreme]Court [in ][the ][pending SLP ][on ][the ][very ][same ][issue'] 19Accordingly, [the ][instant ][writ ][petition ][stands ][allowed ][in]ISfavour of [the ][assessee ][so ][far ][as ][the ][issue ][of ][jurisdiction]concemed. [As ][a ][consequence, ][the ][impugned ][notice ][under]challenge [under Sections ][148-4 ][and ][148 stands set ][aside/quashed'] \ The consequential orders, if any, also stand set aside/quashed insimilar terms as have been passed by this High Court in the case ofKankanala Ravindra Reddy (t supra). There shal be no order asto costs Consequently, miscellaneous petitions pending, if any, shall stand closed. To, ECTION OFFICER 12[iil, ][q"fl% ][rax€rricer ][w ][ard ][1, ][Aditabad Aditabad, Hyderabad, ][Hyderabad]1,",1"*"1T3,.31"J::,fi 1,",1"*"1T3,.31"J::,fi f '".J8.f }?,,],ffi L*[r.?,1,.%1[{f#iI,'r"f 3;'Ei,iJ"1[:%T;J;?"tis,iL1?.Js"[,,l?;f tr;,[ffi t:[{f#iI,'r"f 3;'Ei,iJ"1[:%T;J;?"tis,iL1?.Js"[,,l?;f tr;,[ffi t:i}!"^J,fly:',t1:Jff Faceless Assessment Faceless Assessment ilin,^"'onu' center, lncome Tax Department, New J 4 5 b. ff ff fl[fr+rr'm['s,rffi"sw-..r.rffi [,"I]fl[fr+rr'm['s,rffi"sw-..r.rffi [,"I] 7. 8. I BM LS HIGH COURT DATED:28 tO4t2O2S :::::=\lHE SI^f.(oc,(,I1{ruBzrE,.)o/*a€/,lc! ORDER WP.No.34335 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS