Satya Narayan Tanwar vs. The Income Tax Officer, Ward 7(1)

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WP/2460/2024HC TelanganaHBHC01004847202401 February 2024Bench: P.SAM KOSHY,N.TUKARAMJI6 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 were not drawn in accordance with the amended provisions of the Income Tax Act, 1961, but under the unamended provisions, which is unsustainable. The Court referred to its previous judgment in WP.No.25903 of 2022 & batch, dated 14.09.2023, wherein it was held that the preliminary objection regarding jurisdiction was sustained, and the writ petitions were allowed on that ground. The Court noted that the impugned notices and orders were quashed on the point of jurisdiction, and other issues raised by the petitioner were reserved to be raised in appropriate proceedings. The Court also acknowledged the Supreme Court's direction in Ashish Agrawal to proceed under substituted provisions as a one-time measure, but clarified that this Court allowed petitions only on procedural faults. Consequently, the rights of the parties were reserved as envisaged in paragraphs 37 and 38 of the previous order. The operative direction was to allow the present writ petition on similar terms.

What were the facts?

The petitioner, Narayan Tanwar, filed a writ petition before the High Court of Telangana at Hyderabad challenging an order passed by the Income Tax Officer, Ward T(1), Hyderabad, under Section 148A(d) of the Income Tax Act, 1961, dated 28/03/2023, and a notice under Section 148 of the Act dated 30/03/2023, for Assessment Year 2016-17. The petitioner contended that these actions were arbitrary, illegal, and violative of the principles of natural justice and constitutional provisions. The petitioner argued that under the amended provisions of the Act, effective from 01.04.2021, the respondents were required to issue a notice under Section 148A and provide an opportunity of hearing, especially since the reopening was initiated by the jurisdictional Assessing Officer. The revenue did not dispute the petitioner's objection regarding the procedural lapse.

What were the issues?

1. Whether the order passed under Section 148A(d) and the notice under Section 148 of the Income Tax Act, 1961, for AY 2016-17 are arbitrary, illegal, bad in law, void-ab-initio, and violative of the principles of natural justice, Articles 14, 19(1)(g), and 265 of the Constitution of India, and Section 148A of the Act, as contended by the petitioner. Assessee's Contentions: - The respondents failed to follow the amended provisions of the Income Tax Act, which came into effect from 01.04.2021, by not issuing a notice under Section 148A and providing an opportunity of hearing to the assessee. - The reopening was initiated by the jurisdictional Assessing Officer, which is contrary to the faceless assessment procedure under the amended provisions. - Relied on a previous judgment by the same Bench in WP.No.25903 of 2022 & batch, dated 14.09.2023. Revenue's Contentions: - The revenue did not dispute that the objection regarding the procedural lapse was decided in the aforesaid batch of writ petitions. - However, the revenue contended that there were other various objections raised by the petitioner in the writ petition.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (SPecial Original Jurisdiction) THURSDAY, THE FIRST DAY OF FEBRUARY TWO THOUSAND AND TWENTY FOUR PRESENT THE I.IONOURABLE SRI JUSTICE P. SAM KOSHY AND THE HONOURABLE SRI JUSTICE N. TUKARAMJT [ 337e ] years, 3-5-301, ...PETITIONER WRIT PETITION NO:2 460 0F 2024 Between: """-s-riw Narayan Tanwar, S/o Sri omprakash. Tanwar' as-el ^5^1 Fi;i fu .' e0 i, Ram rrlo'liin t'l-ivi s' na'i' rote' H vd e ra ba d - 500 00 1 AND 1 2 ThelncomeTaxofficer,WardT(1),lncomeTaxDepartment,Hyderabad A'Jrei'#;';t i_rnit rnti,.b raiddpSrt."nr, Natronal e-Assessment center G"r;6;ii,i:'R;;ti.l ilii+oi , z"'o n6''' r-nimp Jawaharlal Nehru stadium' New Delhi ...RES'ONDENTS I i Petition under Article 226 of the Constitution.of lndia praying that in the cir"rr.Ln"-"s lt"GO in tie attiJ"'it filed therewith' the High Court may be ;i;;;1; ;ue a writ oi rtl'no""t or anv other appropriate writ order or Direction declaring a tne oiOer patt"O oV the i st Resoondent u/s l aBA(d) of the lncome Tax Act rsor oateileioiizozz'o.rlng DIN and Notice No DIN Notice No. IrBA/AST/Ft14}N2o2;-7lioiiszaqs7(1) for the A Y 2016-17 and Notice under 148 of tne ect viAe DIN Notice No ITBA/AST/S/148 112022- 2311051699418(1) for the n.V. ioro-rz dated 30/03/2023 as arbitrary illegal bad in law void-ab-initio violative of the principles of natural iustice apart froT,Eins viotative of Artictes r+,rggIJ iol or tn" constitution oi lndia and Sec 148A of the lncome Tax Act f gOf anO co-nsequently set aside the same in the interests of justice. @,"ouon,*erSection151CPCprayingthatinthecircumslancesstated in the affidavit filed in sup'io't-"t tn" petitionl the High Court may !e.9lea1ed please direct tne respontlnts to slay all further oroceedinqs. including any recovery, pursuant to the notice issuei by the 1st Resoondent' u/s '148 of the tncome Tax Act, 1961,"";;; -DlN f'iotice^^No tieRlRsrlsltaSlt2o22' 23i1051699418(1) for the'A.i 'iolO-tt dated 30-03-2O23' for the Assessment 7-i^iiota-lt, p"nOing disposal of the NIain Whit Pelition' Coun."f for the Petition"tt M/t' HIMANGINI !1!G.Il Counsel for the Respona"nitt Snf J'V' PRASAD (SC FOR INCOME TAX) if," C""tt made the'following: ORDER !t I I t

THE HONOURABLE SRI JUSTICE P.SAM KOSITY AND THE HONOURABLE SRI JUSTICE N.TTIKARAMJI WRIT PETITION No.2460 0F 2024 ORDER: (per lt<n'bte.Sri Jrr.srice P.SAM KOSHfl) The instant Writ perition has been Iiled by the petitioner uncler Article 226 of the Constitution of India seeking for the follor,r,ing relief "to issue a Writ of Mondomus or ooy othet oppropriote Writ, Order or Direction decloring the order possed by the 1st Respondent u/s 14BA(d) of the lncone Tox Act 1961 doted 2B/O3/2023 beoring DIN ond Notice No DtN Notice No ITEA/AST/F/148A/2O22.23/10515r84g7(1) for the A.Y. 2076-17 ond Notice under 148 of the Act vide DtN N'oiice tto. |TBA/AST/S/148_1/2022.2 3/lls16gsa B(1) for the A.y.2016_17 ddted 3O/03/2O2i os orbttrory. i egot, bod in low, void-ob_initio, violotive of the principles of noturol justice oport from being violotive of Articles 14 199 ond 265 of the Constitution ol tndio ond Sec 14gA of thi tncome fox Act 7961 ond consequently set oside the some in the iiterests ol Justice and to poss". 2. One of the contentions that the petitioner has raised in the present Writ petition is that under the amended provisions of the Act n,hich came into effect from Ol.O4.2O2l, the respondents, u,hile proceeding under Section 148 of the Act, rt ere required to issue notice under Section 148A and provide an opportunity of hearing to the assessee. As pcr the amencled provision of law, proceedings to be drar,r,n are also in a faceless manner. the I I i I I I

2 3. Whereas, learned counsel for the petitioner contended that, in the instant case, reopening has been initiated by the Jurisdictional Assessing Officer. In support of his contention, he relied upon the recent judgment rendered by this very Bench in WP.No.25903 of 2022 &' batch, dated 14.O9 .2023 wherein this Court disposed of the 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. Hou'eter, hc furthcr contended that apart from the aforesaid objection, there have been other various objections also u'hich thc petitioner has raised in the writ petition. 5. So far as this contention of the learned counsel for the respondcnt Dcpartment 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 "37. The preliminary objection raised by the petitiotter is susloined and all these writ petitrons stnnds allorued orr this uery jurisdictionol issue. Since the impugned. t.toticc.s and orders are getting quashed on the point of jurisdiction, u)e are not inclined to proceed further and decide the other issues raised by the petitioner uthich stands reserued to be raised qnd contended in an appropiate proceeding s. " '38. Since the Hon'ble Supreme Court had,, in the case of Ashish Agarutal, supra, as a one-time measure e-xercising the pouters under Article 142 of the Con_stitution of lndia, pemitted the Reuenue to pioceed uncler the substituted prouisions, and. thii Court allountq the petitions only on the procedurat Jtau,t, fhe ight <'onfened on the Reuenue tuould, remain reserued to proceed further if theg so want from the stage of the order of the Supreme Court in the case oy einisn Aganuctl, supra." 6. I n view of the same, we are inclined to allow the present writ petition also on similar terms. Accordingly, the present Writ Petition stands allowed on the objection of the petitioner that the proceedings have not been drawn in erccordance 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 reservcd as is envisarged at paragraph Nos.37 & 3g of the said order passccl in the batch of writ petitions. No order as to costs. a ) I It I 1 t I rl

4 Consequently, miscellaneous petitions pending, if any, shall stand closed //TRUE COPY// SD/. K.SREERAMA MURTHY ASSISTANT REGISTRAR SECTION OFFICER To, l.ThetncomeTaxofficer,WardT(1),lncomeTaxDepartment,Hyderabad i. A;;";;";t Unit lncome'iaio'ip5rtment, National e-Assessment center ' i'ffiD;i;i: i.orn r'lo +or ' znJFtbor., E-Rimp Jawaharlal Nehru Stadium' New Delhi ffi;6;'i; Ni1/s. HIMANGINI sANGHl, Advocate-[oPU9] -..^. ffi EE i;SRr i.V. PRAdAo tSc FoR TNCoMETAX) [oPUC] 3 4 5. Two CD CoPies BN GJP

HIGH COURT DATED:01 10212024 ORDER WP.No.2460 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS ) ? I ii'6 llrl l ):;3.,- I :t t', \-t:..i:::-, (4G? q\ijr_ \/ \. \

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