NIKUNJ ARUN SANGHAVI vs. THE INCOME TAX OFFICER WARD 5 (1) , PUNE AND ORS

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WP/5744/2022HC BombayHCBM01019041202205 May 2022Bench: HON'BLE SHRI JUSTICE K.R. SHRIRAM,HON'BLE SHRI JUSTICE N. R. BORKAR4 pages
AI SummaryRemanded

What did the High Court hold?

The Hon'ble High Court of Bombay, in light of the Apex Court's judgment in Union of India & Ors. vs. Ashish Agarwal, has disposed of all the writ petitions. The court has applied the directions issued by the Apex Court, which modify and substitute the impugned judgments. Specifically, notices issued under the unamended Section 148 of the Income Tax Act, 1961, are to be deemed as issued under Section 148A of the Act and treated as show-cause notices under Section 148A(b). The Assessing Officer is directed to provide information and material relied upon by the Revenue within thirty days, allowing assessees two weeks to reply. The requirement of conducting an enquiry under Section 148A(a) is dispensed with as a one-time measure for notices issued under the unamended Act from April 1, 2021, till date. Thereafter, Assessing Officers are to pass orders under Section 148A(d) and then issue notices under Section 148 as substituted. All defenses available to assessees and revenue under the Finance Act, 2021, and law remain preserved. Assessment orders passed previously are quashed and set aside, and the revenue may restart the process as directed by the Apex Court.

What were the facts?

The petitioners, Emcure Pharmaceuticals Limited and other assessees, have filed multiple writ petitions before the Bombay High Court. These petitions challenge various orders and notices issued by the Assistant Commissioner of Income Tax, Central Circle 2(1), Pune, and other revenue authorities. The core of the dispute revolves around notices issued under Section 148 of the Income Tax Act, 1961, which were subsequently challenged. The present proceedings are a consequence of the Hon'ble Apex Court's judgment in Union of India & Ors. vs. Ashish Agarwal, which partially set aside orders of the Allahabad High Court and other High Courts, including this court's judgment in Tata Communications Transformation Services Limited V/s. Assistant Commissioner of Income Tax 14(1) & Ors. The Apex Court's directions modify and substitute the impugned High Court judgments.

What were the issues?

1. Whether notices issued under the unamended Section 148 of the Income Tax Act, 1961, prior to the substitution by the Finance Act, 2021, should be deemed to have been issued under Section 148A of the Act, as directed by the Hon'ble Apex Court in Union of India & Ors. vs. Ashish Agarwal? Assessee's Contention: The assessees are before the High Court seeking relief based on the directions of the Apex Court. The specific arguments would align with the relief sought in the writ petitions, which are now being disposed of in light of the Apex Court's ruling. Revenue's Contention: The revenue is bound by the directions of the Apex Court. Their position would be to implement the Apex Court's order, which involves treating the notices as show-cause notices under Section 148A(b) and proceeding accordingly. No specific arguments from the revenue are recorded in this excerpt, other than their participation in the proceedings.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 148A(a),Section 148A(b),Section 148A(d),Section 149

AI-generated summary — verify with the full judgment below

1/4 968-WP-5293-2022 @ Group matters.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 5293 OF 2022 Emcure Pharmaceuticals Limited

….Petitioner V/s. Assistant Commissioner of Income Tax Central Circle 2(1), Pune and Ors.

…Respondents ALONGWITH WRIT PETITION NO. 5294 OF 2021 ALONGWITH WRIT PETITION NO. 5691 OF 2022 ALONGWITH WRIT PETITION NO. 5737 OF 2022 ALONGWITH WRIT PETITION NO. 5738 OF 2022 ALONGWITH WRIT PETITION NO. 5739 OF 2022 ALONGWITH WRIT PETITION NO. 5740 OF 2022 ALONGWITH WRIT PETITION NO. 5741 OF 2022 ALONGWITH WRIT PETITION NO. 5742 OF 2022 ALONGWITH WRIT PETITION NO. 5743 OF 2022 ALONGWITH WRIT PETITION NO. 5744 OF 2022 ALONGWITH WRIT PETITION NO. 5745 OF 2022 ALONGWITH WRIT PETITION NO. 5747 OF 2022 ALONGWITH WRIT PETITION NO. 5748 OF 2022 ALONGWITH WRIT PETITION NO. 5749 OF 2022 ALONGWITH WRIT PETITION NO. 5750 OF 2022 ALONGWITH WRIT PETITION NO. 5751 OF 2022 ALONGWITH WRIT PETITION NO. 5752 OF 2022 Purti Parab PURTI PRASAD PARAB Digitally signed by PURTI PRASAD PARAB Date: 2022.05.10 13:13:37 +0530

2/4 968-WP-5293-2022 @ Group matters.doc ALONGWITH WRIT PETITION NO. 5753 OF 2022 ALONGWITH WRIT PETITION NO. 4862 OF 2022 ALONGWITH WRIT PETITION NO. 4863 OF 2022 ALONGWITH WRIT PETITION NO. 4864 OF 2022 ALONGWITH WRIT PETITION NO. 4866 OF 2022 ALONGWITH WRIT PETITION NO. 4868 OF 2022 ALONGWITH WRIT PETITION NO. 4869 OF 2022 ALONGWITH WRIT PETITION NO. 4872 OF 2022 ALONGWITH WRIT PETITION NO. 5031 OF 2022 ALONGWITH WRIT PETITION NO. 5032 OF 2022 ALONGWITH WRIT PETITION NO. 5559 OF 2022 ---- Mr. Govind Gopal Javeri, Mr. J.D. Mistri, Senior Advocate a/w Mr. Madhur Agrawal i/b Atul Jasani, Mr. Satish Mody & Ms. Aasifa Khan, Mr. Devendra Jain a/w Ms. Radha Halbe, Mr. Dharan V. Gandhi, Mr. Rahul Hakani i/b Ms. Niyati Mankad Hakani, Ms. Dishya Pandey i/b Mr. Shreyas Shrivastava, Mr. Vivek Sarin and Ms. Dibya Prashant Singh, Mr. Sameer S. Bora a/w Ms. Vidhi K. Pinmiya i/b SPCM Legal for Petitioners-Assessees in respective matters. Mr. Suresh Kumar and Mr. Akhileshwar Sharma for Respondents-Revenue in respective matters. ---- CORAM : K.R. SHRIRAM & N. R. BORKAR, JJ.

DATED : 5th MAY, 2022 P.C. : 1. The Hon’ble Apex Court in the judgment of Union of India & Ors. vs. Ashish Agarwal1 partially set aside the order and judgment passed by the Hon’ble High Court Judicature at Allahabad in Writ Tax No.524 of 2021 1 Civil Appeal No. 3005/2022 dated 4th May, 2022. Purti Parab

3/4 968-WP-5293-2022 @ Group matters.doc and other Writ Tax Petitions. The order also covers the judgments passed by various other High Courts including this court in Tata Communications Transformation Services Limited V/s. Assistant Commissioner of Income Tax 14(1) & Ors.2 2. The Hon’ble Apex Court has in paragraph no.10 passed the following directions : 10. In view of the above and for the reasons stated above, the present Appeals are ALLOWED IN PART. The impugned common judgments and orders passed by the High Court of Judicature at Allahabad in W.T. No. 524/2021 and other allied tax appeals/ petitions, is/are hereby modified and substituted as under: (i) The impugned section 148 notices issued to the respective assessees which were issued under unamended section 148 of the IT Act, which were the subject matter of writ petitions before the various respective High Courts shall be deemed to have been issued under section 148A of the IT Act as substituted by the Finance Act, 2021 and construed or treated to be show-cause notices in terms of section 148A(b). The assessing officer shall, within thirty days from today provide to the respective assessees information and material relied upon by the Revenue, so that the assessees can reply to the show-cause notices within two weeks thereafter; (ii) The requirement of conducting any enquiry, if required, with the prior approval of specified authority under section 148A(a) is hereby dispensed with as a one-time measure vis-à-vis those notices which have been issued under section 148 of the unamended Act from 01.04.2021 till date, including those which have been quashed by the High Courts. Even otherwise as observed hereinabove holding any enquiry with the prior approval of specified authority is not mandatory but it is for the concerned Assessing Officers to hold any enquiry, if required; 2. Writ Petition No.1334 of 2021 dated 29th March, 2022. Purti Parab

4/4 968-WP-5293-2022 @ Group matters.doc (iii) The assessing officers shall thereafter pass orders in terms of section 148A(d) in respect of each of the concerned assessees; Thereafter after following the procedure as required under section 148A may issue notice under section 148 (as substituted); (iv) All defences which may be available to the assesses including those available under section 149 of the IT Act and all rights and contentions which may be available to the concerned assessees and Revenue under the Finance Act, 2021 and in law shall continue to be available. 3. In view of the above all petitions are disposed. 4. Certainly, since all rights and contentions of the parties are kept open, the assessees may take such steps if they are aggrieved by any order passed by the Assessing Officer. 5. In view of the above, wherever the assessment order has been passed those assessment orders will stand quashed and set aside. So also the consequential orders/notices. 6. Revenue may restart the process as directed by the Hon’ble Apex Court. (N. R. BORKAR, J.) (K.R. SHRIRAM, J.) Purti Parab

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