Mr. Venkata Surya Subrahmanya Lakshminarayana Dronamraju vs. Assessment Unit

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WP/29663/2023HC TelanganaHBHC01053912202319 October 2023Bench: P.SAM KOSHY,LAXMI NARAYANA ALISHETTY7 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the present writ petition on similar terms as W.P. No. 28860 of 2023, which was decided on October 13, 2023. The primary ground for allowing the petition was the petitioner's objection that the proceedings were not drawn in accordance with the amended provisions of the Income Tax Act, 1961, but under the unamended provisions, which was held to be unsustainable. The Court referred to its previous order in W.P. No. 25903 of 2022 and batch, where it had sustained the preliminary objection on jurisdictional grounds and quashed the impugned notices and orders. The High Court reiterated that the respondents' rights would stand reserved as envisaged in paragraph 37 of the said batch order, meaning the Revenue could pursue the matter afresh in appropriate proceedings. Consequently, the assessment order was set aside, and miscellaneous applications were closed. No order as to costs was made.

What were the facts?

The petitioner, Mr. Venkata Surya Subrahmanya Lakshminarayana Dronamraju, filed a writ petition challenging an assessment order passed by the Assessment Unit, National e-Assessment Center, New Delhi, under Section 147 read with Section 144B of the Income Tax Act, 1961, for Assessment Year 2016-17. The assessment order was dated May 29, 2023. The petitioner sought to declare the order arbitrary, illegal, void-ab-initio, and violative of principles of natural justice and constitutional provisions. The petitioner also sought a stay on recovery proceedings. The High Court noted that an identical writ petition (W.P. No. 28860 of 2023) had already been allowed and disposed of by the same bench on October 13, 2023.

What were the issues?

1. Whether the assessment order passed under Section 147 read with Section 144B of the Income Tax Act, 1961, dated May 29, 2023, for Assessment Year 2016-17, is 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 149A of the Income Tax Act, 1961. Assessee's Contention: The petitioner argued that under the amended provisions of the Act, effective from April 1, 2021, the respondents were required to issue a notice under Section 148A and provide an opportunity of hearing before proceeding under Section 148. The petitioner contended that the proceedings were not conducted in a faceless manner as mandated and that the reopening was initiated by the jurisdictional Assessing Officer, contrary to the amended provisions. The petitioner relied on a previous batch of writ petitions decided by the same bench on September 14, 2023, in W.P. No. 25903 of 2022 and batch. Revenue's Contention: The learned counsel for the Revenue did not dispute that the objection regarding the procedure under the amended provisions had been decided in the aforesaid batch matters. However, the counsel stated that apart from this objection, the petitioner had raised other objections. The High Court noted that the Revenue did not dispute the decision on the primary objection.

Which sections of the Income-tax Act were involved?

Section 147,Section 144B,Section 148,Section 148A,Section 149A

AI-generated summary — verify with the full judgment below

\\ [ 3386 ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE NINETEENTH DAY OF OCTOBER TWO THOUSAND AND TWENTY THREE PRESENT THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE LAXMI NARAYANA ALISHETry WRIT PETITION NO:29663 OF 2023 Between: AND 1 lvlr. _ Venkata Surya Subrahmanya Lakshmin arayana Dronamraju, S/o. Mr. D.V- Jogeswara Rao, aged 50 years, Occ. Business, H.No.358, Road No. .10, Mithal Nagar, Banjara Hills, Hyderabad - 500 034, Telangana. ...PETITIONER Asselsrnsnl Unit, lncome Tax Department, National e-Assessment Center, New Delhi, Room No.40'1 , 2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, New Delhi - 1 10 003. The lncome Tax Officer - Ward 14(1), Hyderabad, l.T. Towers, AC Guards, Masab Tank, Hyderabad - 500 004, Telangana. The Principal Commissioner of lncome Tax - '1, Hyderabad, Room No.71 1, 7th Floor,'A'Block, l.T.Towers, AC Guards, Hyderabad - 500 004, Telangana. The Central Board of Direct Taxes, Represented by its Chairman, Department of Revenue, Mlnrptry of Finance, Government of lndia, Secretariat Buildings, New Delhi - 1 10 001 . 2 J 4 ...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 a Writ of [Vlandamus or any other appropriate Writ, Order or Direction, declaring the Assessment Order passed by the 1st Respondent, u/s 147 rlw Sec. 1448 of the lncome Tax Act, 1961, dated 29.05.2023, bearing DlN.: lTBtuASf lsl14712023-2411053269917(1), for the Assessment Year 2016 - 17, as arbitrary, illegal, bad in law, void-ab-initio, violative of the principles of natural justice, apart from being violative of Articles 14, 19(1Xg) and 265 of the

/: Constitution of lndia and Sec .14gA of the lncome Tax Act, 196i , and to consequently set aside the same in the interests of justice lA NO: 1 OF 2023 Petition under section r 51 cpc praying that in the circumstances stated in the affidavit fired rn support of the petition, the High court may be preased to stay all further proceedings, incruding any recovery, pursuant to the Assessment order passed by the 1st Respondent, uls 14T r/w sec. 1448 of the lncome Tax Act, '1 961, dated 29.05 2023, bearing DlN.: tTBA/AST/S/147t2023_ 241105326991t (1), for the Assessment year 2Oi6 _ 1Z, pending disposal of the above Writ Petition. Counsel for the Petitioner: SRt A.V.A.SIVA KARTIKEYA Counsel for the Respondents: SRI J.V.PRASAD, Sr. SC FOR INCOME TAX The Court made the foltowing: ORDER i I I i i 1 I I i I

'I'tlE IIOir"'Ill.[. SI{I .IUSI'ICE P.SAM KOSUY ANT) .TTIE, HON'BLE SITI JTJSTICE LAXMI NARAYANA ALTSHE'[TY WItIT' PEI'ITION No.29663 of 2O23 ORDER.4u,r' I ktn hlt.\rt.lu.sticc P.S.AM KOS\lYl Whcn tl-re mattcr is tal<en up lbr hearing today, it has beer.r in lonrcd by the partics that an identical writ petition \\'.P.no.lti8(r0 ol'2023 has alleadl' bcer.r allowcd and disposed of vidc order datcd I 3. 10.2023. 2. ln vicw ol- tlrc fhct ttraI t['rc idcntical rnatter has already been allou,cd bl,this Coult, we ale inclined to allow the present ri,rit pr.tition also, in terms olthe order passed in W.P.No.28860 o12023 decided on 1:i. I 0.202i on sinrilar terrns. 3. As a sequel, miscellaneous applications pending ilany in this writ petition, shall stand closed. No ordcr as to costs. //TRUE COPY// SD/. G.SIREESHA ASSISTANT REGISTRAR qD SECTION OFFICER To, BSR 1. The Assessment Unit, lncome Tax Department, National e-Assessment Center, New Delhi, Room No.. 401, 2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, New Delhi - 1 10 003. 2. The lncome Tax Officer - Ward 14('l), Hyderabad, I.T- Towers, AC Guards, Masab Tank, Hyderabad - 500 004, Telangana. 3. The Principal Commissioner of lncomeTax- 1, Hyderabad, Room No 711,7th Floor' 'A' Block, l.T.Towers, AC Guards, Hyderabad - 500 004' Telangana 4. The Chairman, Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, Government oI lndia, Secretariat Buildings, New Delhi - 110 001' 5. One CC to SRI A.V.A.SIVA KARTIKEYA, Advocate [OPUC] 6. One CC to SRI J.V.PRASAD, Sr' SC FOR INCOME TAX [OPUC] 7- Two CD CoPies (Along with the copy of the order in W.P.No.28860 of 2023, dated 13'10'2023) GJ \->r

HIGH COURT DATED: 1911012023 ORDER WP.No.29663 of 2023 ALLOWING THE WRIT PETITION WITHOUT COSTS -rv{ '-r i"io ti \ * $ J HC\ \\ of g,L -(-\ 1 \<' U

7 THE HON'BLE SRI JUSTICE P.SAM I{OSHY AND THE HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY W.P. No. 28a6O of 2o23 ORDER:r,,, ,iz, .'r,, ;r, P.S/M KOSHY) Hcarcl Mr. A.V.A. Srva Kartikeya, learncd counsel for the petitioncr anrl Ms. B. Sapna Reddy, learned Junior Standing Counsel for Income T:rx ap;tcilring for the respondents. Peruscd thc entire record. 2. The instant petition has been filed challenging tlle Assessment Order passcd by rcspondent No. I under section 147 read rvith 1448 of the Ir-rcome Tax Act, 1961 (hereinafter referred to as "the Act") darted 11.05.2023 lor the Assessment Year 2O16-77- 3. One of the contentions that the petitioner has raised in the preserlt writ petition is that under the amended provisions of the Act which came into effect from 01 .04.202 1 , the respondents while proceeding under Section 148 of the Act were required to issuc notice under Section 148A and provide an opportunity of hearing to the asscssce. As per thc amended provision of law, the proceedings to bc dralr,,n are also in a laceless manner. Whereas, it has been contended by the petitioner that in the instant case, reopening has been initiated by the Juridictional Assessing Offrcer. In respect of the said objcction that the pctitioner had raised, he relied upon the recent batch of writ

2 pctitions decided by thrs \ ei-\ Bcnc-h on l'+.09.2023 vrde W.P.No.25903 of 20'22 and brttt'h to the lirnited exlcnt. 4. Lcarncd counscl for tlrc i)ellartlllcnt wcluld not dispute of l'raving dr:cidecl thc said ol;jt:c:tiott irt the zrforesarcl batch matters. However, learncd coulseL sttltt'n;ts that apart frorn the aforesaid objection, there havc bccn olltcl virr-ious obiections etlso rvl.rich thc pelilioner has raised in thr \vlil l|, rllion. 5. So lar as this cont{'nliolr of tl-tc lcarued counsel lor thc Departmcnt is conccrnctl. thts Elcncl.t, whilc disposing ol W.P.No.259O3 of 2022 ancl b:rtch had taken notc of thc same in paragraph No.37 u,hich is reprodrtt:ei l-rercitt ut'rder: "37. The prclirninarl olrj<<:tion raisetl by the Petitioner rs sustained ancl all thcsc \\'rit l)ctltious st.ul(ls allowcd on this vcrl' jurisdictional rs:jue . Srrrc( lhc r[rpugrrcd troticcs atrtl ordcrs arc gctting quashcd on rll.r i).,llr( ol lLrrls]clicti()D. \re are llot inclined to procccd furtlrcr and ,lrttrlt tlrc ()tllcl tssues raiscd by thc petitroner whrclr stands tcsct vecl Lo be r;tiscd and conLettded in atr appropriaLe pr o< eedings." 6. In view of thc samc. wc al-c inclincd to allow the present writ petition also on sinrilar terrns. Acr:ordingly, the present Writ Petition stands allowed on thc objcr,'ttorr of the petitioncr that the proceedings have not been drawn in accorclance with the amended provision but under the unamended provision u'hich is otherwise uot sustainable. As has been held by this Betrch itr thc aforesaid batch matters, the right of the responclents rvould stand reserwed :rs is envisaged in paragraph No.37 ol the said b:rtcl.t. No order as to costs.

3 Consequentll.. rniscellancous stand closed. Dated: 13.10.)O23 Put petitions pending, if any, shall P.SAM KOSHY, J LAXMI NARAYANA ALISHETTY, J

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