M/s. Dr. Reddys Laboratories Limited. vs. The Assistant Commissioner of Income Tax

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WP/3936/2023HC TelanganaHBHC01007230202321 September 2023Bench: P.SAM KOSHY,LAXMI NARAYANA ALISHETTY2 pages
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What did the High Court hold?

The High Court allowed Interlocutory Application No. 1 of 2026, finding the impleadment of proposed respondents necessary for adjudicating the challenge to the vires of Section 147-A of the Income Tax Act, 1961. It also allowed Interlocutory Application No. 2 of 2026, permitting amendment of the writ petition's prayer, to be completed within ten days. The Court directed that the writ petition be listed along with connected matters on 11.11.2026 before an appropriate bench. Crucially, the Court granted an interim stay of the impugned order, referencing a Supreme Court decision in Civil Appeal No. 004716 of 2026 and batch, decided on 10.04.2026. The registry was directed to reflect the name of Ms. J. Sunitha as Senior Standing Counsel for the Income Tax Department. No specific finding on the vires of Section 147-A was made at this stage, as the matter was adjourned and an interim stay was granted.

What were the facts?

This judgment concerns Writ Petition No. 3936 of 2023 filed before the High Court for the State of Telangana. The petitioner is challenging the vires of Section 147-A of the Income Tax Act, 1961. The proceedings also involve Interlocutory Application No. 1 of 2026, seeking to implead proposed respondents, which was allowed as necessary for the challenge to the provision. Interlocutory Application No. 2 of 2026, seeking amendment of the prayer in the writ petition, was also allowed, with the amendment to be carried out within ten days. The case is to be listed along with other connected matters before an appropriate bench on 11.11.2026.

What were the issues?

1. Whether the provisions contained in Section 147-A of the Income Tax Act, 1961, are intra vires the Constitution. The petitioner's argument is that the challenge is to the vires of Section 147-A of the Income Tax Act, 1961. The judgment does not explicitly record the arguments of the revenue. However, the allowance of the interlocutory application to implead respondents suggests the revenue's participation is anticipated or required. The core of the dispute revolves around the constitutional validity of the aforementioned section.

Which sections of the Income-tax Act were involved?

Section 147-A

AI-generated summary — verify with the full judgment below

HIGH COURT FOR THE STATE OF TELANGANA MAIN CASE No: W.P.No.3936 of 2023 PROCEEDING SHEET Sl. No. Date ORDER OFFICE NOTE 3. 28.10.2026 HACJ (PSK,J) & LNA,J

Counsel for the petitioner : Sri M.Venkatram Reddy

Counsel for the respondents : Ms. J.Sunitha,

learned Senior Standing

Counsel for Income Tax

Department.

I.A.No.1 of 2026

This interlocutory application seeking to implead the proposed respondents in the writ petition is taken up.

Since the challenge in the writ petition is to the vires of the provisions contained in Section 147-A of the Income Tax Act, 1961, impleadment of the proposed respondents is necessary. In view of the same, we are inclined to allow the present interlocutory application.

Accordingly, this interlocutory application stands allowed. I.A.No.2 of 2026

This interlocutory application seeking amendment of prayer in the writ petition is taken up.

For the reasons stated in the supporting affidavit, this interlocutory application is allowed.

Let the amendment be carried out within a period of ten days. W.P.No.3936 of 2023

List this case along with W.P.Ṇo.35311 of 2026 and other connected matters on 11.11.2026 before

Transferred to i/o folder, before corrections, if any.

2 an appropriate Bench as per roster in the light of amendment and challenge made to the vires of the provisions contained in Section 147-A of the Income Tax Act, 1961.

Meanwhile, there shall be interim stay of the impugned order in the light of the order passed by the Hon’ble Supreme Court in Civil Appeal No.004716 of 2026 and batch (arising out of SLP (C) No. 014521 of 2026 and batch; Diary No.2196 of 2026 and batch) decided on 10.04.2026.

Registry is directed to reflect the name of Ms. J.Sunitha, learned Senior Standing Counsel for Income Tax Department in place of learned counsel Ms. Sundari R.Pisupati in the cause list. _______________ HACJ (PSK,J)

_______________ LNA,J vs

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