ASHRAF ABDUL GANI KHAN vs. INCOME TAX OFFICER WARD 34(1)(1) AND ANR

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WP/3855/2022HC BombayHCBM01011061202204 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. The Court reasoned that the procedure followed was the old procedure, which had been replaced by the Finance Act, 2021, with effect from April 1, 2021. The Court relied on its previous decision in Tata Communications Transformation Services Limited V/s. Assistant Commissioner of Income Tax 14(1) & Ors., where similar notices were quashed. The ratio decidendi is that a Section 148 notice issued after the effective date of the new procedure, but following the old procedure, is invalid. The impugned notice was quashed and set aside. The petition was disposed of accordingly.

What were the facts?

The petitioner, Ashraf Abdul Gani Khan, filed a writ petition challenging a notice issued under Section 148 of the Income Tax Act, 1961. The notice was dated April 20, 2021. The petitioner's counsel stated that no assessment order had been communicated. The respondents are the Income Tax Officer, Ward 34(1)(1), and others. The High Court noted that the procedure followed for the notice was the old procedure, which was replaced by the Finance Act, 2021, effective from April 1, 2021. The Court accepted the statement that no assessment order had been communicated and observed that even if one were passed, it would be non-est as the notice itself was being set aside.

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, dated April 20, 2021, is bad in law, considering that the procedure under the Finance Act, 2021, became effective from April 1, 2021. The petitioner argued that the notice was issued following the old procedure, which had been superseded by the Finance Act, 2021. Therefore, the notice was invalid. The revenue did not present any arguments on this issue.

Which sections of the Income-tax Act were involved?

Section 148

AI-generated summary — verify with the full judgment below

1/2 920.WP-3855-2022.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.3855 OF 2022 Ashraf Abdul Gani Khan ….Petitioner V/s. Income Tax Officer, Ward 34(1)(1) & Ors. ….Respondents ---- Ms. Dishya Pandey i/b. Mr. Shreyas Shrivastava for petitioner. Mr. Suresh Kumar for respondents. ---- CORAM : K.R. SHRIRAM & N.R. BORKAR, JJ.

DATED : 4th 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 Ms. Pandey states that she 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. Gauri Gaekwad GAURI AMIT GAEKWAD GAURI AMIT GAEKWAD Date: 2022.04.06 11:22:49 +0530

2/2 920.WP-3855-2022.doc impugned in this petition is hereby quashed and set aside. 4 Petition disposed accordingly. (N.R. BORKAR, J.) (K.R. SHRIRAM, J.) Gauri Gaekwad

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