NIHALANI KALPNA SATRAM vs. DY. COMMISSIONER OF INCOME TAX, CIRCLE 2(1)(1), VADODAR

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SCA/20239/2022HC GujaratGJHC24063397202214 February 2023Author: HONOURABLE THE CHIEF JUSTICE MS. JUSTICE SONIA GOKANI,HONOURABLE MR. JUSTICE SANDEEP N. BHATT3 pages
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What did the High Court hold?

The High Court allowed the petition, quashing and setting aside the impugned notice dated July 27, 2022, issued under Section 148 of the Income Tax Act. The Court applied the reasoning from its previous decision in Keenara Industries Private Limited Vs. The Income Tax Officer, Surat and allied matters, which had allowed pleas regarding limitation and quashed notices for AY 2013-14 and AY 2014-15. The Court found no need to elaborate on the reasoning, directly applying the precedent. The rule was made absolute to this extent. No specific issue was left undecided; the entire challenge to the Section 148 notice was decided.

What were the facts?

The petitioner, Nihalani Kalpna Satram, challenged a notice issued under Section 148 of the Income Tax Act, 1961, dated July 27, 2022, by the Dy. Commissioner of Income Tax, Circle 2(1)(1), Vadodara. This notice was preceded by a notice under Section 148A(b) dated May 23, 2022, for Assessment Year 2014-15, issued in light of the judgment in Union of India Vs. Ashish Agarwal. The petitioner replied to the 148A(b) notice, following which the respondent passed an order under Section 148A(d) on July 27, 2022, and simultaneously issued the impugned notice under Section 148 as per the Finance Act, 2021.

What were the issues?

1. Whether the notice dated 27.07.2022 issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2014-15, is liable to be quashed and set aside? (Question of law and mixed fact/law, concerning Section 148 and Finance Act, 2021). Assessee's contention: The petitioner sought to quash the notice under Section 148. The petition relied on the reasoning of this Court in the case of Keenara Industries Private Limited Vs. The Income Tax Officer, Surat and allied matters, Special Civil Application No.17321 of 2022, decided on 07.02.2023, which allowed pleas concerning limitation and quashed similar notices for AY 2013-14 and AY 2014-15. Revenue's contention: The judgment records that Mr. Nikunt Raval, learned standing counsel, waived service of notice of rule for the respondent. No specific arguments were recorded for the revenue.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
C/SCA/20239/2022 ORDER DATED: 14/02/2023 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 20239 of 2022 ========================================================== NIHALANI KALPNA SATRAM Versus DY. COMMISSIONER OF INCOME TAX, CIRCLE 2(1)(1), VADODAR ========================================================== Appearance: DILIPKUMAR U PRAJAPATI(8344) for the Petitioner(s) No. 1 MR NIKUNT K RAVAL(5558) for the Respondent(s) No. 1 ========================================================== CORAM:HONOURABLE THE CHIEF JUSTICE (DESIGNATE) MS. JUSTICE SONIA GOKANI and HONOURABLE MR. JUSTICE SANDEEP N. BHATT Date : 14/02/2023

ORAL ORDER (PER : HONOURABLE THE CHIEF JUSTICE (DESIGNATE) MS. JUSTICE SONIA GOKANI)

1.

The petitioner seeks to challenge the notice issued under Section-148 of the Income Tax Act, 1961 dated 27.07.2022. In under Section-148A(b) for the A.Y. 2014-15 on 23.05.2022, which have been replied to eventually and the respondent passed an order under Section-148A(d) on 27.07.2022. A notice under Section-148 as per Finance Act, 2021 came to be passed on the very day. C/SCA/20239/2022 ORDER DATED: 14/02/2023

2.

The challenge is made by way of following main prayers:- “8(A) To issue a writ of certiorari and/or a writ of mandamus and/or any other writ, direction or order to quash and set aside the impugned notice dated 27.07.2022 under Section 148 annexed at Annexure-’A’ for proceeding and completing reassessment proceedings. B. Pending admission, hearing and disposal of this petition, ad-interim relief be granted and the respondent be ordered to restrain from enforcing compliance of the impugned notice dated 27.07.2022 under Section 148 annexed at Annexure-A and/or taking any steps in this regard including ex-parte order.”

3.

Rule made returnable forthwith. Mr. Nikunt Raval, learned standing counsel waives service of notice of rule for and on behalf of respondent.

4.

On hearing both the sides and also, in wake of decision of this Court in case of Keenara Industries Private Limited Vs. The Income Tax Officer, Surat and allied matters; Special Civil Application No.17321 of 2022; decided on 07.02.2023, where this Court on the issue of limitation has allowed the plea of petitioner and quashed the notices for the A.Y. 2013- 14 and A.Y.2014-15 issued by the respondent, this petition is C/SCA/20239/2022 ORDER DATED: 14/02/2023 also allowed applying the very reasoning without elaborating the same.

5.

Resultantly, the petition is allowed quashing and setting aside the notice impugned dated 27.07.2022 issued under Section-148 of the Act. Rule is made absolute to the aforesaid extent. (SONIA GOKANI,CJ(DESIG.)) (SANDEEP N. BHATT,J) M.H. DAVE

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