Sri Satyanarayana Taraka vs. Assessment Unit

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WP/5205/2024HC TelanganaHBHC01010004202428 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 that the proceedings were not drawn in accordance with the amended provisions but under the un-amended provisions, which is not sustainable. The Court referred to its earlier judgment in WP.No.25903 of 2022 & batch, dated 14.09.2023, where similar petitions were allowed on the jurisdictional issue. The Court noted that in the cited batch, the petitions were sustained on the preliminary objection, and all impugned notices and orders were quashed on the point of jurisdiction. The Court explicitly stated that it was not inclined to proceed further and decide other issues raised by the petitioner, reserving those issues to be raised in appropriate proceedings. The Court also referenced paragraph 38 of the earlier order, which noted the Supreme Court's decision in Ashish Agrawal and clarified that allowing petitions on procedural law would reserve the right for the Revenue to proceed from the stage of the Supreme Court's order if they so desired. Consequently, the present writ petition was allowed on similar terms, reserving the rights of the parties as envisaged in the earlier order.

What were the facts?

The petitioner, Sri Satyanarayana Taraka, filed a writ petition challenging an order passed by the Assessment Unit, National Faceless Assessment Centre, under Section 147 read with Sections 144 and 144B of the Income Tax Act, 1961, for Assessment Year 2013-14. The petitioner contended that the reopening of assessment was initiated by the Jurisdictional Assessing Officer, which is contrary to the amended provisions of the Act that came into effect from April 1, 2021. These amended provisions mandate faceless proceedings and require the issuance of a notice under Section 148A with an opportunity of hearing. The petitioner argued that the order was arbitrary, illegal, and violative of Sections 148A, 149, and 151A of the Act, as well as CBDT circulars.

What were the issues?

1. Whether the reopening of assessment under Section 147 of the Income Tax Act, 1961, initiated by the Jurisdictional Assessing Officer, is valid in light of the amended provisions of the Act effective from April 1, 2021, which mandate faceless proceedings and require notice under Section 148A? Assessee's Contentions: - The reopening initiated by the Jurisdictional Assessing Officer is illegal as it violates the amended provisions of the Act effective from April 1, 2021, which require faceless proceedings and a notice under Section 148A with an opportunity of hearing. - The order passed is arbitrary, illegal, bad in law, void ab initio, and contrary to Sections 148A, 149, and 151A of the Act and CBDT circulars. - Relied on the judgment of this Bench in WP.No.25903 of 2022 & batch, dated 14.09.2023. Revenue's Contentions: - The respondent-Department does not dispute that the objection regarding the amended provisions was decided in the aforesaid batch of Writ Petitions. - However, the Department contended that apart from the aforesaid objection, there were other various objections raised by the petitioner.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 144B,Section 148A,Section 149,Section 151A

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 EIGHTH 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: 5205 OF 2024 Between: AND I Sri Satyanarayana Taraka, S/o. Sri T. Rajalingam, aged about 55 years, 6-13- 32, Namdevvada, Nizamabad - 503002. ...PETITIONER Assessment Unit, National Faceless Assessment Centre, lncome Tax OLpirt.""t, fr,lini'tt.v of Finance, Room No. 4O1,2"d Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi - 1 10 003- The lncome Tax Officer, Ward- 1, 6-2-15613, Subash Nagar, Nizamabad- 503002. 2 ...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 pass an order or direction, especially one in the nature of WRIT OF MANDAMUS holding that the order passed by 1't Respondent uls. 147 r.w.s. 144 r.ws. 144B of the Act. dt.O2.O5.2023 with DIN No.ITBA/AST/S114712023' 24t1O52546713(1 ) for the Ay.2013-14, as arbitrary, illegal, bad in law, void ab initio, apart from being vtolative of provisions of section 148A ahd section 1 49 of the Act and also contrary to the circular issued by CBDT and provisions of section 151A of the Act, and consequently set aside the same.

lA 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, including any recovery, pursuant to the order passed by the '1't Respondent u/s. '147 r.w.s. 144 r.ws. 1448 of the Act, d1.02.05.2023 with D I N No. ITBA/A Sf I S I 1 47 I 2023-241 1 0525467 13( 1 ) for the Ay. 20 1 3- 1 4. Counsel for the Petitioner: SRI A V RAGHU RAM Counsel for the Respondents: SUNDARI R PISUPATI (Sr SC for lncome Tax Dept) The Court made the following: ORDER

THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE N.TUKARAMJI WRIT PETITION No.S2OS OF 2024 ORDER:lper Ho n'ble Si Justice P.SAM KOSI::II|) Heard Mr.A.V.Raghu Ram, learned counsel for the petitioner and Ms.Sundari R. Pasupati, learned Senior Standing Counsel for the Income Tax Department for respondents. Perused the material available on record. 2. The instant Writ Petition has been filed by the petitioner under Article 226 of the Constitution of India seeking for the following relief: "to pass an order or direction espectallg one in the nature of WRIT OF MANDAMUS holding that the order passed bg 1st Respondent u/s 147 r u s 144 tttts 1448 of the Act dt.O2/05/2023 tuith DIN No. ITBA / AST/ S/ 147 / 202324 / 1052546713(1)for the Ag 201314 as arbitrary itlegal bad in laut uoid ab initio apart from being uiolatiue of proui.sions of section 148A and sectton 149 of the Act and also contrary to the circular issued bg CBDT and prouisiorts of section 151A of the Act and consequentlA sel aside the same". 3. One of the contentions that the petitioner has raised in the present Writ Petition is that under the amended provisions of the Act rvhich came into effect from

2 PS[{,J & NTR,J W.P.No.52OS oJ 2024 O L .O4 .2O21 , the respondents, while proceeding under Section 148 of the Act, were required to issue notice under Section 148,{ and provide an opportunity of hearing to the assessee. As per the amended provision of law, the proceedings to be drawn are also in a faceless manner. 4. 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.259O3 of 2022 & batch, dated 14.O9.2023 wherein this Court disposed of the batch of writ petitions to the limited extent. 5. On the other hand, learned Standing Counsel for the respondent-Department does not dispute that the said objection was decided in the aforesaid batch of Writ Petitions. However, he lurther contended that apart from the aforesaid objection, there have been other various objections a-lso which the petitioner has raised in the writ petition. 4

3 PSK,J & NTR,J W.P.No.S2OS oJ 2024 6. So far as this contention of the learned counsel for the respondent-Department is concerned, this Bench, while disposing of said batch of writ petitions, had taken note of 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 wit petitions stands allowed on this uery jurisdictional issue. Since tLe impugned notices and orders are getting quashed on the point of jurisdiction, u)e are not inclined to proceed further and decide the other tssues raised by the petitioner uthich stonds reserued to be raised and contended in an appropriate proceeding s. " "38. Since the Hon'ble Supreme Court had, in the cose of Ashish Agonual, supra, as a one-time meosure exercising the pouers under Article 142 of the Constitution of India, permitted the Reuenue to proceed under the substituted prouisions, and this Court ollouing the petitions onlg on the procedural J7aw, the ight confened on the Reuenue uLould remain reserued to proceed further if they so uant from the stage of the order of the Supreme Court in the case of Ashish Aganaal, supra." 7. In view of the salne, 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.

4 PSK,J & NTR,J W.P.No.52OS of 2024 8. As has been held by this Bench in the aforesaid batch matters, the rights of the parties would stand reserved as is envisaged at paragraph Nos.37 & 38 of the said order passed in the batch of writ petitions. No order as to costs. Consequently, miscellaneous petitions pending, if any, sha-ll stand closed. SD/.8. SARASWATHI ASSISTANT REGI RAR //TRUE COPY// SECTION OFFICER .-i. To, 1 2 Assessment Unit, National Faceless Assessment Centre, lncome Tax OLoirtr"nt. MinistrY of Finance, Room No. 401,2nd Floor, E-Ramp' Jawaharlal Nehru Siadium, Delhi -1 10 003. ii"ln.o." rlibnicer, Ward 1, Nizamabad' 6-2-15613, Subash Nagar' Nizama bad On" CC to Sri A. V. Raghu Ram, Advocate [OPUC] - o;; CC io smrSunoarih Pisupati (Sr SC foi lncome Tax Dept) [OPUC] Two CD Copies a 4 TJ GJP

HIGH COURT DATED:2810212024 ORDER WP.No.5205 of 2024 ALLOWING THE WRIT PETITION WITHOUT COSTS. I {ltG sY,c L6: 23 tAB ml .OS PAfC !)o r) i I ; ]t * rt\elry i I I I I I ! i i i I

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