Mr Srinivas Bandaru vs. Income Tax Officer

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WP/34686/2023HC TelanganaHBHC01063772202327 December 2023Bench: 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. The Court held that the proceedings were not drawn in accordance with the amended provisions of the Act but under the unamended provisions, rendering them unsustainable. The Court referred to its previous judgment in W.P.No.25903 of 2022 & batch, where similar writ petitions were allowed on the jurisdictional issue. The Court reiterated that the impugned notices and orders were being quashed on the point of jurisdiction. The rights of the parties were reserved as envisaged in paragraphs 37 and 38 of the previous order, which stated that other issues raised by the petitioner were not decided and stood reserved to be raised in appropriate proceedings. The Court noted that the Supreme Court, in the case of Ashish Agarwal, had permitted the Revenue to proceed under substituted provisions as a one-time measure, but this Court allowing petitions only on procedural flaws meant the Revenue's right to proceed further from the stage of the Supreme Court's order remained reserved. No order as to costs was made.

What were the facts?

The petitioner, Tondupalli, filed a writ petition challenging an order under Section 148A(d) and a consequential notice under Section 148 of the Income Tax Act, 1961, for Assessment Year 2015-16. The petitioner contended that these actions were taken by the Jurisdictional Assessing Officer (JAO) instead of the Faceless Assessment Unit (FAO), which was contrary to the amended provisions of the Act that mandated faceless proceedings. The petitioner also argued that the proceedings were initiated under the unamended provisions, violating principles of natural justice by not providing an opportunity of hearing. The respondents, represented by the Standing Counsel, did not dispute the procedural flaw but indicated other objections existed.

What were the issues?

1. Whether the impugned order and notice for AY 2015-16, issued by the Jurisdictional Assessing Officer (JAO) instead of the Faceless Assessment Unit (FAO), are void, illegal, and contrary to the Income Tax Act and principles of natural justice? (Question of law and mixed fact and law, concerning Section 148A and Section 148 of the Income Tax Act, 1961). Assessee's Contentions: - The proceedings were initiated by the JAO instead of the FAO, which is contrary to the amended provisions of the Act effective from 01.04.2021, mandating faceless proceedings. - The proceedings were drawn under the unamended provisions, violating principles of natural justice by not providing an opportunity of hearing. - Relied on a previous judgment by the same Bench in W.P.No.25903 of 2022 & batch dated 14.09.2023. Revenue's Contentions: - The Standing Counsel did not dispute that the objection regarding the authority issuing the notice was decided in the aforesaid batch of writ petitions. - However, the Revenue contended that apart from the procedural objection, there were other various objections raised by the petitioner.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148

AI-generated summary — verify with the full judgment below

[ 337e ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE TWENTY SEVENTH DAY OF DECEMBER TWO THOUSAND AND TWENTY THREE PRESENT THE HON'BLE SRI JUSTICE P.SAM KOSHY AND THE HON'BLE SRI JUSTICE N. TUKARAMJI WRIT PETITION NO: 34686 0F 2023 Between: Tondupalli, Shamshabad ...PETITIONER AND 1. lncome Tax Officer, Ward 8('1 ),Signature Towers, Sy. No. 6(p) of Kondapur, !y QZ(e)ot Kothaguda, Opp. Botanical Gardens, Seritingarir6iaili(t\,4), R.R. District, Hyderabad - 500084 2. The Principal Chief Commissioner Of lncome Tax, Ap and 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 Petition under Article 226 oI the Constitution of tndia ,rrr;,ff:[:i?"=lH 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 dated 06.04.2022 passed u/s 148A(d) of the Act vide DIN No.tTBA/AST/Ft14BA|2O22- 23110425583820 and the consequential notice u/s. 148 Dt 06.04.2022 vide DtN No.ITBA/AST/S1148_112022-23110425753130, for A.Y. 2015-16 issued by the JAO ('l't Respondent) instead of FAO (3'd responderrt), as vord, illegal and contrary to the provisions of the lncome Tax Act and contrary to the principles of Natural Justice. IA NO: 1 OF 2023 Petition under Section 151 CPC praying that in the circumstances staled 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.O6.O4.2o22of the Act vide ITBA/AST/S/148 112022-231 104257 5313(1)issued by the 1st Respondent(JAO Mr Srinivas Bandaru, Age 50 years 2-22 Hyderabad-501218

)for A.Y. 2015-l6instead of 3rd respondent(FAO), and may pass such other orde(s) as the Honorable court deems fit and proper in the iflterests of substantial justice, as otherwise the Petitioner would be put to irreparable loss and severe injury. Counsel for the Petitioner: SRI DUNDU MANMOHAN Counsel for Respondents: SMT. SUNDARI R PISUPATI Sr SC FOR INCOME TAX DEPARTMENT The Court made the following: ORDER

THE HONOURABLE SRI JUSTICE P.SAM KOSI{Y AND THE HONOURABLE SRI JUSTICE N.TUKARAMJT WRIT PETITION l{o.34686 OF 2o23 ORDER:1per 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 challenging the order issued under Section 148A(d) of the lncome Tax Act, 1961 (for short, "the Act") bearing DIN No.ITBA/AST lF I t48A/2022-23 / ro425sa3a2 (1), dared 06.O4 .2022 passed by respondent No. I for the assessment vear 2018-19 and the consequent notice under Section 148 of the Act, dated 06.04.2022, bearing DIN No.ITBA/AST /S I t48_t / 2022-23 / 1042s7s313 ( t) 2. One of the contentions that the petitioner has raised in the present Writ Petition is that under the amendecl provisions of the Act which came into effect from 0l .04.2O2 1, the respondents, u,hile proceeding under Scction 148 of the Act, were required to issue notice Llnder Section 148A and provide an opportunit-r' of hearing to thc

2 PS.K,J & MrR,J W.P.No.34686 of 2O2S assessee. As per the amended provision of law, the proceedings to be drawn are also in a faceless manner 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 rhis very Bench in Wp.No.259O3 of 2022 & batch, dated 14.Og.2023 wherein this Court disposed of the batch of writ petitions to the limited extent. 4. On the other hand, learned Stalding Counsel for the respondent- Department does not dispute that the said objection u as decided in the aforesaid batch of Writ Petitions. Horvever, he further contended that apart from the aforesaid objection, there have been other various objections also u-hich the petitioner has raised in the writ petition. 5. So far as this contention of the learned counsel for the respondenL Departmcnr is concerned, this Bench, while disposing of said barch of \\,rit petitions, had taken note of

3 I PSI(,J & rVrR,J W.P.No.34686 o;f 2O23 the same at para€raph Nos.37 & 38 which are reproduced herein under: '37. TIE preliminary objection roised bg the petitioner is sustained and oll th.ese uit petitrbns stands alloued on this uery jurisdictional issue. Since lhe impugned notices and orders are getting qtashed on the point of jurisdiction, u-)e are not inclined to proceed further and decide tle other issues raised bg the petitioner which stands reserued to be raised ond contended in an appropiate proceeding s. " "38. Since the Hon'ble Supreme Court had, in the case of Ashish Agaruta\ supro, as a one-time meosure exercising the pouers under Article 142 of the Constitution of India, permitted the Revenue to proceed under the substituted prouisions, and this Court allouing the pe-titions onlg on the procedural flaut, the right confened on the Reuenue uould remain reserued to proceed further if tlrcy so want from the stage of the order of the Supreme Court in tle case of Ashish Aganual, supra. " 6. [n vier.r, of the same, we are inclined to allow the present u'rit 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 accordance u'ith the amended provision but under thc un amended provision which is otherwise not sustainable- 7. As has been held by this Bench in the aforesaid batch matters, the rights ol the parties u'ould stand reserved as is

4 To, 6. MBC GJP PSI(,J&,MrR,J W.P.No.34686 oJ 2023 envisaged at paragraph Nos.37 & 3g cf the said order passed in the batch of writ petitions. No order as to costs. Consequently, miscellaneous petitions pending, if any, shall stand closed. SD/.B. SARASWATHI ASSISTANT REQISTRAR //TRUE COPY// \ '.\-- SECTION OFFICER The lncome Tax Officer, Ward 8(1),Signature Towers, Sy. No. 6(P) of Kondapur, Sy. 37(P) of Kothaguda, Opp. Botanical Gardens, Serilingampalli(M), R.R- District, Hyderabad - 500084 The Principal Chief Commissioner Of lncome Tax, AP and TS, 10th Floor, C- Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad 500004. 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-110003 One CC to Sri Dundu Manmohan Advocate [OPUC] One CC to Smt. Sundari R Pisupati (Sr SC for lncome Tax Dept) Advocate loPUcl Two CD Copies 1. 2. 3. 4. 5. g

@)qw HIGH COURT DATED: 2711212023 ORDER WP.No.34686 of 2023 ALLOWING THE WRIT PETITION WITHOUT COSTS g9- ia\W AT g,f \\\ ? ti OF o 1\1\ ) A (l)oo t 1 * it E -qP pi

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