VINAY SUDHARSHAN GUPTA HUF vs. ASSISTANT COMMISSIONER OF INCOME TAX AND ORS

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WP/4793/2022HC BombayHCBM01015968202220 April 2022Author: HON'BLE SHRI JUSTICE K.R. SHRIRAM,HON'BLE SHRI JUSTICE N. R. BORKAR2 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, dated April 20, 2021, was bad in law and liable to be quashed. The reasoning was that the notice was issued after the Finance Act, 2021, came into effect on April 1, 2021, mandating a new procedure, yet the old procedure was followed. The court explicitly stated that such notices are bad in law and have to be quashed, referencing its prior ruling in Tata Communications Transformation Services Limited V/s. Assistant Commissioner of Income Tax. Consequently, the impugned notice was quashed and set aside. The court also noted that even if an assessment order had been passed, it would be non-est. The petition was disposed of accordingly.

What were the facts?

The petitioner, Vinay Sudharshan Gupta HUF, filed a writ petition challenging a notice issued under Section 148 of the Income Tax Act, 1961. The notice was dated April 20, 2021, but the procedure followed was the old procedure, which was replaced by the Finance Act, 2021, effective from April 1, 2021. The petitioner's counsel stated that no assessment order had been communicated. The High Court noted that even if an assessment order was passed, it would be non-est (void) because the Section 148 notice itself was being set aside. The court referred to its prior decision in Tata Communications Transformation Services Limited V/s. Assistant Commissioner of Income Tax.

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, dated April 20, 2021, is invalid due to the procedural changes brought about by the Finance Act, 2021, effective from April 1, 2021? Assessee's contention: The assessee argued that the notice was bad in law because it was issued after the effective date of the new procedure under the Finance Act, 2021, but followed the old procedure. The assessee relied on the High Court's decision in Tata Communications Transformation Services Limited V/s. Assistant Commissioner of Income Tax. Revenue's contention: The judgment records no specific contention from the revenue regarding the validity of the notice.

Which sections of the Income-tax Act were involved?

Section 148

AI-generated summary — verify with the full judgment below

1/2 909-wp-4793-22.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 4793 OF 2022 Vinay Sudharshan Gupta HUF ….Petitioner V/s. Assistant Commissioner of Income Tax Circle 27(3) & Ors. …Respondents ---- Mr. Vasudev Ginde i/b Mr. Kumar Kale for Petitioner Mr. Suresh Kumar for Respondents ---- CORAM : K.R. SHRIRAM & N.R. BORKAR, JJ

DATED : 20th APRIL 2022 P.C. : 1 In this case the notice issued under Section 148 of the Income Tax Act, 1961 (the Act) is dated 20th April 2021 but the procedure followed is the old procedure which came to be replaced by the Finance Act, 2021 with effect from 1st April, 2021. 2 Mr. Ginde states that he does not have any instructions of any assessment order having been communicated to petitioner. Statement accepted. Even if the assessment order is passed, still it will be non-est as the notice issued under Section 148 of the Act itself is being set aside. 3 We have already held in Tata Communications Transformation Services Limited V/s. Assistant Commissioner of Income Tax 14(1) & Ors.1 that such notices are bad in law and have to be quashed. Accordingly, notice

1.

Writ Petition No.1334 of 2021 dated 29th March, 2022. Meera Jadhav MEERA MAHESH JADHAV MEERA MAHESH JADHAV Date: 2022.04.22 10:58:47 +0530

2/2 909-wp-4793-22.doc impugned in this petition is hereby quashed and set aside. 4 Petition disposed accordingly. (N. R. BORKAR, J.) (K.R. SHRIRAM, J.) Meera Jadhav

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