Siripuram Rama Krishna vs. The Income Tax Officer

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WP/3790/2024HC TelanganaHBHC01007409202414 February 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. The Court held that the proceedings were not drawn in accordance with the amended provisions of the Income-tax Act, 1961, but under the un-amended provisions, which is unsustainable. The Court relied on its previous judgment in WP.No.25903 of 2022 & batch, dated September 14, 2023. In that batch of cases, the Court had sustained the preliminary objection regarding the jurisdictional issue and quashed the impugned notices and orders. The Court clarified that since the petitions were allowed on the procedural flaw, the rights of the parties would stand reserved as envisaged in paragraphs 37 and 38 of the earlier order. This means the Revenue would have the right to proceed further from the stage of the Supreme Court's order in the case of Ashish Agarwal, if they so wished. The operative direction was to allow the present writ petition on similar terms, quashing the impugned order and notice on the procedural ground.

What were the facts?

The petitioner, Siripuram Rama Krishna, filed a writ petition challenging an order passed under Section 147 read with Sections 144 and 144B of the Income-tax Act, 1961, for Assessment Year 2015-16. The petitioner also challenged a consequential notice issued under Section 148. The petitioner contended that the notice and order were issued by the Jurisdictional Assessing Officer (JAO) instead of the Faceless Assessing Officer (FAO), and that the proceedings were not conducted in accordance with the amended provisions of the Act, which came into effect from April 1, 2021. These amended provisions require the issuance of a notice under Section 148A and an opportunity of hearing to the assessee, with proceedings to be conducted in a faceless manner.

What were the issues?

1. Whether the impugned order and notice for Assessment Year 2015-16, passed under Section 147 read with Sections 144 and 144B and Section 148 of the Income-tax Act, 1961, are void, illegal, and contrary to the provisions of the Act and principles of natural justice, due to being issued by the Jurisdictional Assessing Officer instead of the Faceless Assessing Officer and not following the amended procedure under Section 148A. Assessee's Contentions: - The reopening of assessment was initiated by the Jurisdictional Assessing Officer, which is contrary to the amended provisions of the Act effective from April 1, 2021. - Under the amended provisions, notice under Section 148A must be issued, and an opportunity of hearing provided to the assessee. - Proceedings should be conducted in a faceless manner. - Relied on the High Court's judgment in WP.No.25903 of 2022 & batch, dated September 14, 2023. Revenue's Contentions: - The Standing Counsel for the respondent Department did not dispute that the objection regarding the procedure was decided in the aforesaid batch of writ petitions. - However, the Department contended that apart from the procedural objection, the petitioner had raised other objections as well.

Which sections of the Income-tax Act were involved?

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

AI-generated summary — verify with the full judgment below

[ 337e ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE FOURTEENTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE P,SAM KOSHY AND THE HONOURABLE SRI JUSTICE N.TUKARAMJI WRIT PETITION NO: 3790 OF 2024 Between: Siripuram Rama Krishna, S/o, Siripuram Venkataiah, aged 44 years, Occ ; Business, R/o.H.No.9-l-3411517|a, Bapu Nagar, Golconda S.0, GotConda, HYDERABAD, 50000B, Telangana, INDIA PAN. CVJPS4726F Assessment Year. 2015-16. .....PETITIONER AND 1. The lncome Tax Officer, WARD 14(1), l.T Towers, A.C. Guards Masab Tank, HYDERABAD, Telangana, 500001. 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. 401,2nd Floor, E- Ramp, Jawaharlal Nehru Stadium, Delhi-1 '10003. .....RESPONOENTS 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 for A.Y. 2015- '16passed uls 147 r.w.s 144 read with section 1448 ol the lncome-tax Act vide ITBA/AST/S/14712023-2411059718314(1) dated 15-01-2O24and the consequential notice u/s '148 dated 1B-O4-2O22 vide DIN No. ITBA/ASTlsl148- 112022- 2311042754954(1)issued by the JA0(1St respondent) instead of FA0(3rd respondent), as void, illegal, and contrary to the provisions of lncome-tax Act and contrary to the principles of natural justice.

|.A.NO:1 OF 2024 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 pursuant to the notice u/s 148 dt. 18-04-2022 vide DIN No. ITBA/AST/S/1 48112022-2311042754954(1) issued by the '1st Respondent (JAO) for A.Y 2015-16 instead of 3'd respondent (FAO), and may pass such other order(s) as the Hon'ble Court deems fit and proper in the interests of substantial justice, as otherwise the Petitioner would be put to irreparable loss and severe injury. Counsel for the Petitioner : SRI THANNERU CHAITANYA KUMAR Counsel for the Respondents : SRI J.V.PRASAD (SC FOR INCOME TAX) The Court made the following ORDER

THE HONOURABLE SRI JUSTTCE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE N.TUI(ARAMJI WRIT PETITION No.379O oF 2024 ORDER:(per Ho n'ble Si Justice P.SAM KOSHII) The instant Writ Petition has been filed by the petitioner under Articl e 226 of the Constitution of India seeking for the following reliel "to issue an appropiate tuit order or direction more particulortg one in- thi noture of Wit of Mandamus declaing 'the impugied ord.er for A Y 2o1516passed u/s 747 r w s 144 reoi uith section 1448 of the Income tox Act uide ITBA/ AST/ S/ 147/ 202324/ 10597183141 dt I 5o12o24and the consequential notice u/s 148 dt 18042022 uide DIN No I\BA/ ASTT S/ 1481/ 2022 23/ 10427549541issued bs the JA}1S1 respond-ent instead of FAO3rd' respond'ent as uoid iltegat and-contrary to the proui-sio-ns of .Income tox Act ond .oit ory to the Pinciptes of Natural Justice" ' 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 carne 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

2 PSI(,J & MTR,J W.P.No.379O of 2024 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 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 Lhe said objection was decided in the aforesaid batch of Writ Petitions. However, he further contended 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 respondent-Department is concerned, this Bench, while disposing of said batch of '"vrit petitions, had taken note of \

3 PSK,J & NTR,J W.P.No.379O oJ 2O24 the same at paragraph Nos.37 & 38 which are reproduced herein under: "37. The preliminary objection raised bg the petitioner is sustained and all these writ petitions stands alloued on this uery juisdictional issue. Since the impugned notices and orders are getting quashed on the point of jurisdiction, u)e are not inclined to proceed further and decide the otLer issues raised bg the petitioner uhich strznds reserued to be raised and contended in an ap prop iate pro ceeding s. " "38. Since the Hon'ble Supreme Court had, in tLrc case of Ashish Agarutal, supra, as a one-time measure exercising the pouters under Article 142 of the Constitution of India, permitted tlrc Reuenue to proceed under the substituted prouisions, and this Court allowing the petitions only on the procedural ftaw, the right confened on the Reuenue utould remain reserued to proceed further if they so u.tont from the stage of the order of the Supreme Court in tLte case of Ashish Aga ru.tal, 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 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

PSK,J& NTR,J W.P,No.379O of 2O24 envisaged at paragraph Nos'37 & 38 of the said order 4 passed in the batch of writ petitions ConsequentlY, miscellaneous shall stand closed' //TRUE COPY// No order as to costs petitions pending, if anY' SD/. MOHD. SANAULLAH ANS RI ASSISTANT REGIST SECTION OFFICER To 1. 2. 3. 4 q o SA GJP g : Two CD CoPies I I i I

1 t HIGH COURT DATED:1410212024 ORDER WP.No.3790 of 2024 ALLOWING THE W.P WITHOUT COSTS. 1 gE S T416 t, t: 1i 0 2 APn 2024 O5spr.tcH * G('* ,(_ .?- w

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