Prasuna Venepally vs. Income Tax Officer

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WP/2255/2024HC TelanganaHBHC01004274202431 January 2024Bench: P.SAM KOSHY,N.TUKARAMJI7 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition on the preliminary objection raised by the petitioner that the proceedings have not been drawn in accordance with the amended provisions but under the unamended provisions, which is otherwise not sustainable. The Court referred to its previous judgment in WP No. 25903 of 2022 & batch, wherein it was held that the preliminary objection raised by the petitioner was sustained, and all those writ petitions were allowed on the jurisdictional issue. The Court stated that since the impugned notices and orders were being quashed on the point of jurisdiction, it was not inclined to proceed further and decide the other issues raised by the petitioner, which stood reserved to be raised and contended in appropriate proceedings. The rights of the parties were reserved as envisaged in paragraphs 37 and 38 of the said order. No order as to costs was passed.

What were the facts?

The petitioner, Prasuna Venepally, filed a writ petition challenging an order dated 29.03.2023 passed under Section 148A(d) of the Income Tax Act, 1961, for Assessment Year 2016-17, and a consequential notice dated 31.03.2023 under Section 148. The petitioner contended that these actions were taken by the Jurisdictional Assessing Officer (JAO) instead of the Assessment Unit (FAO), which is the third respondent. The petitioner argued that the proceedings were initiated under the unamended provisions of the Act, despite the amended provisions requiring a faceless assessment process and an opportunity of hearing. The respondents, represented by the Standing Counsel, did not dispute the petitioner's objection regarding the procedural flaw but noted that other objections were also raised. The High Court referred to its previous judgment in WP No. 25903 of 2022 & batch.

What were the issues?

1. Whether the impugned order dated 29.03.2023 passed under Section 148A(d) and the consequential notice dated 31.03.2023 under Section 148, issued by the JAO instead of the FAO, are void, illegal, and contrary to the provisions of the Income Tax Act and principles of natural justice, particularly in light of the amended provisions of the Act effective from 01.04.2021? (Question of law and mixed fact and law, concerning Sections 148 and 148A of the Income Tax Act). Assessee's Contentions: - The proceedings were initiated by the Jurisdictional Assessing Officer (JAO) instead of the Assessment Unit (FAO). - The reopening was initiated under the unamended provisions of the Act, which is not sustainable. - Relied on the judgment of this very Bench in WP No. 25903 of 2022 & batch, dated 14.09.2023. Revenue's Contentions: - The Standing Counsel did not dispute that the objection regarding the procedural flaw was decided in the aforesaid batch of Writ Petitions. - However, he contended that apart from the aforesaid objection, there have been other various objections also which the petitioner has raised in the writ petition.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A

AI-generated summary — verify with the full judgment below

[ 337s J IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE THIRTY FIRST DAY OF JANUARY TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE P. SAM KOSHY AND THE HONOURABLE SRI JUSTICE N. TUKARAMJI WRIT PETITION NO: 2255 OF 2024 Between: AND 1 Prasuna Venepally, aged 68 years, Wio V. Venkateshwar Rao, 203, lndira Heights, 6-3-597, Venkataramana Colony, Hyderabad - 5OOOO1..'=,TIONER lncome Tax Officer, Ward 'l , Sangareddy, Veerabhadra Nagar, New Bus Stand, Veerabhadra Nagar, Sangareddy, Andhra Pradesh, 502001 The Principal Chief Commissioner of lncome Tax AP & TS, 1Oth Floor, C- Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004. 3. The Assessment Unit, lncome Tax Department, National Faceless Assessment Centre, Delhi, Ministry of Finance, Room No. 4O1, 2nd Floor, E- Ramp, Jawaharlal Nehru Stadium, Delhi-1 10003 ...RESPONDENTS Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an appropriate writ, order or direction more particularly one in the nature of Writ of Mandamus, declaring the impugned order d1.29.03.2023 for A.Y.2016-17 passed u/s '148A(d) of the Act vide DIN No.ITBA/AST/Fl148Al2O22- 2311051623457(1) (Exhibit P-1) and the consequential notice u/s 148 dt.31 03.2023 vide DIN No. ITBA/ASTlst 1 48_1 12022-231 1051 827 31 6(1 ), issued by the JAO (1st respondent) instead of FAO (3'd respondent), as void, illegal, and contrary to the provisions of lncome-tax Act and contrary to the Principles of Natural Justice. z

lA NO: 1 OF 2024 Petition under Section '1 51 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to stay all further proceedings pursuant to the notice u/s 148 dt. 31.03.2023 vide DIN No. ITBA/AST/S/'148-112022-23110518273'16('1)issued by the 1st Respondent (JAO) for A.Y. 2015-l6instead of 3rd respondent (FAO). Counsel for the Petitioner: SRI DUNDU MANMOHAN Counsel for the Respondents: M/s. SUNDARI R PISUPATI (Sr SC for INCOME TAX DEPARTMENT) The Court made the following: ORDER ri..

THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE N.TUKARAMJI WRIT PETITION No.2255 OF 2024 ORDER ftter Hon'ble Si Justice P.SAM KOSHY) The instant Writ Petition has been filed by the petitioner under Article 226 of the Constitution of India seeking for the following relief: "to issue a Wit of Mondamus or ang other appropriate Wit Order or Direction declaring the impugned order dated 29.03.2023 for assessmen[ gear 2016-17 passed u/s 148(d) of the Act uide DIN No.ITBA/ AST/ F/ 148A/ 2022- 23/105162357(1) and tlrc consequential notice u/s 148 dated 31.O3.2O23 uide DIN NO.ITBA/ AST/ S/ 148-1/2022- 23/ 1051827316(1), issued bg the JAO (1't respondent) instead of FAO (3'd respondent), as uoid, ilLegal, and contrary to the prouisions of Income Tox Act ond contrary to the pinciples of natural justice ond pass other orders as this Hon'ble Court mag deem fit and proper". 2. One of the contentions that the petitioner has raised in the present Writ Petition is that under the amended provisions of the Act which caine into effect from Ol.O4.2O2l, the respondents, while proceeding under Section 148 of the Act, were required to issue notice under Section 148A and provide an opportunity of hearing to the assessee. As per the amended provision of law, the proceedings to be drawn are also in a faceless mm.qgr. ffi, @r, ffi,,,

2 PSr(,J& MrR'J W.P.No.2255 of 2024 3. Whereas, learned counsel for the petitioner contendedthat,intheinstantcase'reopeninghasbeen initiatedbytheJurisdictionalAssessingofficer.Insupport ofhiscontention,hereliedupontherecentjudgment rendered by this very Bench in WP'No'25903 of 2022 &' batch,datedl4.og.2o23whereinthisCourtdisposedofthe batch of writ petitions to the limited extent' 4. On the other hand, learned Standing Counsel for the respondent-Department does not dispute that the said objection was decided in the aforesaid batch of Writ Petitions. However, he further contended that apart from the a-foresaid objection, there have been other various objections also which the petitioner has raised in the writ petition. 5. So far as this contention of the leamed counsel for the respondent-Department is concerned' this Bench' while disposing of said batch of writ petitions' had taken note of the same at paragraph Nos'37 & 38 which are reproduced herein under:

3 PSK,J 6u ilrR,J W.P.No.2255 oJ 2O24 .37. The preliminory objection raised bA the petitioner is sustained and all these urit petitions stands allowed on this uery jurisdictional issue. Since the impugned notices and orders are getting quashed on the point of juri.sdiction, u)e are not inclined to proceed furttrcr and decide the other issues raised bg the petitioner tuhich stands reserued to be rai-sed and contended in an appropriate p ro ce eding s. " "38. Since the Hon'ble Supreme Court had, in ttrc case of Ashish Aganua| supro., as a one-time measure exercising the powers under Article 1a2 of the Constitution of India, permitted the Reuenue to proceed under the substituted prouisions, and this Court allou-ting the petitions onlg on tle procedural flaut, tLrc ight confened on the Reuenue uould remain reseraed to proceed further if theg so raant from the stage of ttre order of the Supreme Court in the case of Ashi.sh Agarua| supra." 6. In view of the same, we are inciined to allow the present writ petition also on similar terms. Accordingiy, the present Writ Petition stands allowed on the objection of the petitioner that the proceedings have not been drawn in accordance with the amended provision but under the un-amended provision which is otherwise not sustainable. 7. As has been held by this Bench in the aforesaid batch matters, the rights of the parties would stand reserved as is envisaged at paragraph Nos.37 & 38 of the said order I I I passed in the batch of writ petitions. No order as to costs. I

4 i' PSK,J & NTR,- W.P,No.2255 oJ 2O24 Consequently, miscellaneous petitions pending, if any, shall stand closed. SD/. N. CHANDRA SEKHAR RAO ASSISTANT REGISTRAR //TRUE COPY// <.. ,. UY SECTION OFFICER To, 1. lncome. Tax Officer, Ward 1, Sangareddy, Veerabhadra Nagar, New Bus _ Stand, Veerabhadra Nagar, Sang'areddy', Andhra praOesh,6OiO0l --- 2. The Principal Chief C^omhission6r of tn6ome Tax Ap A iS, ibth Fioor, C_ - ElocK, t. t. towers, 10-2-3, A.C. Guards, Hyderabad_500004. 3. The Assessment Unit, lncome Tax Departri-rent, National Faceless Assessment.Centre, Delhi, Ministry of 'Finance, Room f.to. +Oi, ZnO Floor, E_ Ramp, Jawaharlal Nehru Stadium, Delhi-i l0OO3 4. One CC to SRI DUNDU MANMOHAN, Advocate tOpUCl 5. One CC to M/s. SUNDART R. ptSUpATt (Sr SC fdr tNCdME TAX DEPARTMENT) TOPUC] 6. Two CD Copies BN GJP $ I I

HIGH COURT DATED:31 10112024 ORDER WP.No.2255 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS @)c"ri* :, .. \ ,,,, . \- -,1, f L L'. ,,+

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