ASHRUBA SHRIRANG GARAD vs. THE PRINCIPAL COMMISSIONER INCOME TAX AND OTHERS

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WP/7919/2024HC BombayHCBM03027828202405 August 2024Author: HON'BLE SHRI JUSTICE RAVINDRA V. GHUGE,HON'BLE SHRI JUSTICE Y. G. KHOBRAGADE3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the notice issued under Section 148 of the Income Tax Act, 1961, was unsustainable because it was not issued by the Faceless Assessing Officer (FAO) in accordance with the scheme framed under Section 151(A). The Court relied on its previous decision in Hexaware Technologies Limited Vs. the Assistant Commissioner of Income Tax and Others, which had quashed and set aside a similar notice. Consequently, the notice issued to the petitioner was quashed and set aside. Any further demand notice or penalty notice arising from this unsustainable notice was also set aside. The Court left open all contentions of both sides that were not covered by the Hexaware Technologies judgment and were available in proceedings that could be initiated by the FAO under the Section 151(A) scheme.

What were the facts?

The petitioner, Ashruba Shrirang Garad, filed a Writ Petition before the Bombay High Court, Aurangabad Bench, challenging a notice. The core of the challenge was that the notice was issued by the Jurisdictional Assessing Officer (JAO) instead of the Faceless Assessing Officer (FAO), as purportedly required by Section 151(A) of the Income Tax Act, 1961. The respondents were the Principal Commissioner of Income Tax and others. The High Court noted that the issue was settled by a previous judgment in WP No. 1778/2023 (Hexaware Technologies Limited Vs. the Assistant Commissioner of Income Tax and Others), which held that notices could only be issued by the Faceless Assessing Officer under the relevant scheme.

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, is sustainable when it was issued by the Jurisdictional Assessing Officer (JAO) and not by the Faceless Assessing Officer (FAO) in accordance with the scheme framed under Section 151(A) of the Act? Assessee's contention: The notice could only have been issued by the Faceless Assessing Officer (FAO) as per the provisions of Section 151(A) of the Income Tax Act, 1961. The issuance by the JAO renders the notice unsustainable. Revenue's contention: Not recorded in the judgment. The judgment states that the learned advocates for the respective sides submitted that the issue was settled by the Hexaware Technologies judgment.

Which sections of the Income-tax Act were involved?

Section 151(A),Section 148

AI-generated summary — verify with the full judgment below

7919.

24wp (1) IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD

4 WRIT PETITION NO. 7919 OF 2024 ASHRUBA SHRIRANG GARAD VERSUS THE PRINCIPAL COMMISSIONER INCOME TAX AND OTHERS …. Mr R. R. Chandak, Advocate for Petitioner Mr Alok Sharma, Advocate for Respondents

CORAM : RAVINDRA V. GHUGE AND Y. G. KHOBRAGADE, JJ.

DATE : 5th August, 2024 PER COURT:

1.

We have heard the learned Advocates for the respective sides. Several issues have been raised in this Petition, inter alia, that the impugned notice could not have been issued by the Jurisdictional Assessing Officer (JAO) and which could have been issued in terms of the provisions of Section 151(A) of the Income Tax Act, 1961 by the Faceless Assessing Officer (FAO).

2.

The learned Advocates for the respective sides submit that the judgment dated 03/05/2024, delivered at the Principal 2024:BHC-AUG:17596-DB

7919.

24wp (2) Seat in WP No.1778/2023 (Hexaware Technologies Limited Vs. the Assistant Commissioner of Income Tax and Others), settles this issue. The notice could not have been issued, save and except, by the Faceless Assessing Officer. If it is not issued by the FAO, this Court has ruled in Hexaware Technologies (supra), that such notice is unsustainable and, accordingly, the notice was quashed and set aside.

3.

It is, thus, obvious that the notice being not in accordance with the scheme framed u/s 151(A) of the Income Tax Act, 1961, the view taken in Hexaware Technologies (supra), would be applicable to this case.

4.

In view of the above and considering the conclusions drawn in Hexaware Technologies (supra), the notice issued u/s 148 would be unsustainable. The same is, therefore, quashed and set aside. Any further demand notice or penalty notice in furtherance thereof, would also not survive and stands set aside.

5.

With the above directions, this Writ Petition is disposed off. Needless to state, all the contentions of both the 7919.24wp (3) sides, save and except, those which are covered by the Hexaware Technologies (supra), and which are available to the parties in a proceeding, which can be initiated by the FAO under the scheme framed u/s 151(A) of the Income Tax Act, are left open. (Y. G. KHOBRAGADE, J.) (RAVINDRA V. GHUGE, J.) sjk

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