Eshwaraiah Alishetti vs. The Income Tax Officer

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WP/34472/2023HC TelanganaHBHC01063780202322 December 2023Bench: P.SAM KOSHY,NAGESH BHEEMAPAKA8 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition. The Court noted that an identical writ petition, W.P.No.30153 of 2023, had already been allowed and disposed of by an order dated 30.10.2023. The Court found itself inclined to allow the present writ petition in terms of the order passed in W.P.No.30153 of 2023. The reasoning, as per the cited order, was that the preliminary objection raised by the petitioner regarding the jurisdictional issue (proceedings not drawn in accordance with the amended provisions but under unamended provisions) was sustained. The impugned notices and orders were quashed on this point of jurisdiction. The Court explicitly stated that it was not inclined to decide other issues raised by the petitioner, which stood reserved to be raised in appropriate proceedings. The Court also referred to paragraph Nos. 37 & 38 of its earlier order in W.P.No.25903 of 2022 and batch, which clarified that while the petitions were allowed on procedural flaws, the Revenue's right to proceed further from the stage of the Supreme Court's order in Ashish Agarwal would remain reserved. Consequently, the impugned order and notice were set aside.

What were the facts?

The petitioner, Eshwaraiah Alishetti, filed a writ petition challenging an order dated 06.04.2022 passed under Section 148A(d) of the Income Tax Act, 1961, and a consequential notice dated 06.04.2022 under Section 148 for Assessment Year 2018-19. The petitioner contended that these orders were issued by the Joint Assessing Officer (JAO) instead of the Faceless Assessing Officer (FAO), which is the third respondent. The petitioner argued that this procedural flaw rendered the impugned order and notice void, illegal, and contrary to the principles of natural justice. The respondents are the Income Tax Officer, Ward - 2, Karimnagar, the Principal Commissioner of Income Tax - 2, and the Assessment Unit, National Faceless Assessment Centre, Delhi.

What were the issues?

1. Whether the order passed under Section 148A(d) and the notice issued under Section 148 for AY 2018-19 are void, illegal, and contrary to the provisions of the Income-tax Act and the Principles of Natural Justice, on the ground that they were issued by the Joint Assessing Officer (JAO) instead of the Faceless Assessing Officer (FAO)? (Question of law and mixed fact and law, turning on Section 148A and Section 148 of the Income Tax Act, 1961). Assessee's Contentions: The petitioner argued that under the amended provisions of the Act effective from 01.04.2021, proceedings under Section 148 must be conducted in a faceless manner, requiring the issuance of notice under Section 148A and providing an opportunity of hearing. The petitioner contended that the reopening in this case was initiated by the Jurisdictional Assessing Officer, not the designated faceless authority, violating these amended provisions. The petitioner relied on a batch of writ petitions decided by the same Bench on 14.09.2023 (W.P.No.25903 of 2022 and batch). Revenue's Contentions: The learned counsel for the Department did not dispute that the objection regarding the procedural flaw had been decided in the aforesaid batch matters. However, the counsel submitted that the petitioner had raised other objections as well.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148

AI-generated summary — verify with the full judgment below

[ 33e7 I HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE TWENTY SECOND DAY OF DECEIMBER TWO THOUSAND AND TWENTY THREE PRESENT THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE NAGESH BHEEMAPAKA WRIT PETITION NO: 34472 OF 2023 Between: Eshwaraiah Alishetti, age 78 yrs, H. No.1-5-3, Aravinda Nagar, Jagtial, Karimnagar(district), Telangan a-505327 . ...PETITIONER AND 1 2 3 The lncome Tax Officer, \N ard - 2, Karimnagar, lncome Tax Office, Aayakar Bhavan, Karimnagar, Telangana - 50500'1 . The Principal Commissioner of lncome Tax - 2, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004. The Assessment Unit, , lncome Tax Department, National Faceless Assessment Centre, DAlhi, IVlinistry of Finance, Room No. 4o1,2nd Floor, E- Ramp, Jawaharlal Nehru Stadium, Delhi-1 10003 ...RESPONDENTS Petition under Article 226 ol lhe 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 dt.06.04.2022 passed u/s 148A(d) of the Act vide DIN No. ITBA/AST/FI148A|2O22-2311O42554613(1) and the consequential notice u/s 148 dt.06.04.2022 vide DIN No. ITBA/AST/S/148_112022-231'1042573637(1), for A.Y. 2018-19, issued by the JAO(1"t 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.

/ lA NO: 1 OF 2023 Petition under Section 151 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 pending before the 3'd respondent, pursuant to the notice u/s 148 dt.O6.04.2022 of the Act vide ITBA/AST/S/148 112022- 23t1042573637(1)issued by the 1't Respondent(JAO)for A.Y. 2O1B-19 instead of 3'd responden(FAO). Counsel for the Petitioner: SRI DUNDU MANMOHAN Counsel forthe Respondents: SUNDARI R PISUPATI (Sr SC for lncome Tax Dept) The Court made the following: ORDER

!1. ,,/ THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE NAGESH BHEEMAPAKA WRIT PETITION No.34472 0F 2023 ORDER: ftter Hon'ble Si Justice P.SAM KOSHII) Whenthematteristakenupforhearingtoday'ithasbeen informed by the parties that an identical Writ Petition i'e'' W.P.No.30l53of2023hasalreadybeenallowedanddisposedof uid"e ord'er, dated 30.1O.2023' 2. In view of the fact that the identical matter has already been allowed by this Court, we are inclined to allow this Writ Petition in terms of the order passed in W'P'No 30153 of 2023 decided on 30.10.2023 on similar terms' 3. As a sequ€I, miscellaneous applications pending if any in this Writ Petition, shall stand closed' No order as to costs' SD/- C, PRAVEEN KUMAR ASSISTANT GIS //TRUE COPY// SECTIO OFFICER to'',. ,n" lncome Tax Officer, Ward - 2' Karimnagar' lncome Tax Office' Aayakar , +n:rlissl.T"1gx**ruffii?";:3.'.'+:i-2, rr rowers' 10-2-3' A C -' CuarOs, HVderabad-500004' 3. i#X;i;;".i;i u"ilIli"iih" rax Departmen\Y;"'lS: I3?iLTi r,"",, t- "A#fJi."""'u'1",t"t"*l,ylLl*y;li1ilii.T9"' I EffiH 3 n?[*llixttt*u,'tsl3"3i:1ffi:s]" 'u* Dept) roPUCl 6. Two CD CoPies TJ GJ (Along with the Order Copy dt:30'10 '2023inW'P'No'3O153 of 2O231

::ra$r HIGH COURT DATED:2211212023 ORDER WP.No.34472 of 2023 ALLOWING THE WRIT PETITION WITHOUT COSTS, 1 I JAil 2024 * z TA 14: S wE 1 * oFeF T 6) {, oo

{ THE HON'BLE SRI JUSTICE P.SAM KOSHY AND THE HON'BLE SRI JUSTICE LAXMI NARAYANA AIISHETTY W.P. No.3O153 of 2O23 ORDER: per ao n'ble Si Justice P.SAM KOSHY) Heard Mr. A.V.A. Siva Kartikeya, learned counsel for the petitioner and Ms. B. Sapna Reddy, learned Junior Standing Counsel for Income Tax appearing for the respondents. Perused the entire record. 2. The instant petition has been filed challenging the Assessment Order passed by respondent No. 1 under section 148A(d) of the Income Tax Act, 1961 (hereinafter referred to as "the Act') dated 25.04.2022 for the Assessment Year 2018- 19. 3. One of the contentions that the petitioner has raised in the present writ petition is that under the amended provisions of the Act which came into effect from 01.04.2021, the respondents while proceeding under Section 148 of the Act were required to issue notice under Section 148A and provide an opportunit5r of hearing to the assessee. As per tlre amended provision of law, the proceedings to be drawn are also in a faceless manner. Whereas, it has been contended by the petitioner that in the instant case, reopening has been initiated by the Juridictional Assessing Officer. In respect of the said objection that the petitioner had raised, he relied upon the recent batch of writ

z petitions decided by this very Bench on 14.O9 .2023 vide W.P.No.25903 of 2022 and batch to the limited extent. 4. Learned counsel for the Department would not dispute of having decided the said objection in the a-foresaid batch matters. However, learned counsel submits that apart from the aforesaid 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 learned counsel for the Department 1S concerned, this Bench, while disposing of W.P.No.259O3 of 2022 and batch had taken note of the same in paragraph Nos.37 & 38 which is reproduced herein under: "37. The preliminary objection raised by the petitioner is sustained and all these writ petitions stalds allowed on this very jurisdictional issue. Since the impugned notices and orders are getting quashed on the point ofjurisdiction, we are not inclined to proceed further and decide the other issues raised by the petitioner which stands reserved to be raised and contended in an appropriate proceedings. " 38. Since the Hon'ble Supreme Court had, in the case of Ashish Agarwal, supra, as a one-time measure exercising the powers under Article 142 of the Constitution of India, permitted the Revenue to proceed under the substituted provisions, and this Court allowing the petitions only on the procedural flaw, the right conferred on the Revenue would remain resewed to proceed further if they so want from the stage of the order of the Supreme Court in the case of Ashish Agarwal, supra. 6. In 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 accordalce with the amended provision but under the unamended provision which is otherwise not sustainable. q

,a' 3 As has been held by this Bench in the aforesaid batch matters; the right of the respondents would stand reserved as is envisaged in paragraph Nos.37 & 38 ofthe said batch. No order as to costs. 7. Consequently, miscellaneous petitions pending, if any, shall stand closed. P.SAM KOSHY, J LAXMI NARAYANA ALISHETTY, J Dated: 30.1O.2O23 aqs

4 THE HON'BLE SRI JUSTICE P.SAM KOSHY AND THE HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHE:TTY W.P. No.3O153 of 2023 Qter the Hon'ble Sri Justice P.SAM KOSHY) Dated: 30.1O.2O23 aqs

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