MARTIN INFRA PROJECTS PRIVATE LIMITED vs. UNION OF INDIA AND ORS.

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WPA/1789/2022HC CalcuttaWBCHCA003918202209 February 2022Bench: HON'BLE JUSTICE MD. NIZAMUDDIN3 pages
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What did the High Court hold?

The Calcutta High Court held that the impugned notice issued under Section 148 of the Income Tax Act, 1961, and all subsequent proceedings are quashed. The Court found that the assessing officer had admittedly not issued a notice under Section 148A of the Act before issuing the notice under Section 148, which is a mandatory requirement for cases falling under the amended provisions. The Court relied on its previous decisions in Bagaria Properties and Investment Private Limited & Anr. vs. Union of India & Ors. and Monoj Jain vs. Union of India, which also quashed similar notices for non-compliance with Section 148A. The Court clarified that the quashing of the notice and proceedings would not prevent the assessing officer from issuing a fresh notice in accordance with the law in the future. The writ petition was disposed of with these observations, subject to the petitioner paying costs of Rs. 5000/- to the High Court Legal Services Committee within ten days due to the delay in filing the writ petition without explanation.

What were the facts?

The petitioner, Brubeck Resources Private Limited, challenged a notice issued under Section 148 of the Income Tax Act, 1961. The notice was issued after March 31, 2021. The petitioner argued that the notice was invalid because it was issued without complying with the mandatory requirement of issuing a notice under Section 148A of the Act, as stipulated by the amended provisions. The petitioner also relied on two Calcutta High Court judgments, Bagaria Properties and Investment Private Limited & Anr. vs. Union of India & Ors. and Monoj Jain vs. Union of India, which dealt with similar issues. The revenue was represented by the Union of India and others. The petitioner also filed a supplementary affidavit to show that a final assessment order had not yet been passed.

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, is invalid for non-compliance with the mandatory procedural requirement of issuing a notice under Section 148A of the Act, in cases where the notice under Section 148 was issued after March 31, 2021. Assessee's Contentions: The petitioner argued that the impugned notice under Section 148 was issued in violation of Section 148A of the Act. They contended that there is a mandatory obligation on the assessing officer to issue a notice under Section 148A before issuing a notice under Section 148, especially for cases falling under the newly amended provisions. The petitioner relied on the decisions in Bagaria Properties and Investment Private Limited & Anr. vs. Union of India & Ors. and Monoj Jain vs. Union of India. Revenue's Contentions: The judgment does not record any specific contentions made by the revenue.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 147

AI-generated summary — verify with the full judgment below

OD – 10 ORDER SHEET WPO/1789/2022 IN THE HIGH COURT AT CALCUTTA CONSTITUTIONAL WRIT JURISDICTION ORIGINAL SIDE BRUBECK RESOURCES PRIVATE LIMITED VS UNION OF INDIA AND ORS. BEFORE: The Hon'ble JUSTICE MD. NIZAMUDDIN Date : 20th April, 2022. Appearance: Ms. Sutapa Mitra, Adv. …For the Petitioner Mr. Prithu Dudhoria, Adv. …For the U.O.I. The Court : In this matter, petitioner has filed supplementary affidavit with supporting document to show that final assessment order has not been passed in this matter, which may be kept with the records. Heard learned advocates appearing for the parties. In this matter, petitioner has challenged the impugned notice under Section 148 of the Income Tax Act, 1961 which was issued after 31st March, 2021 with supporting documents on the ground that this case clearly falls under the newly amended act relating to proceedings under Section 147 of the Act and under which there is a mandatory obligation on the part of the assessing officer to issue notice under Section 148A of the Act before issuing any notice under Section 148 of the Act and which has admittedly not done by the assessing officer

2 and the impugned notice under Section 148 of the Act has been issued violation of Section 148A of the Act. Furthermore this case is directly covered by the orders of this Court in the case of Bagaria Properties and Investment Private Limited & Anr. vs. Union of India & Ors. reported in (2022) 134 taxman.com 196 (Calcutta) and also in the case of Monoj Jain vs. Union of India reported in (2022) 134 taxman.com 173 (Calcutta). Considering these facts I hold the impugned notice under Section 148 of the Act and all subsequent proceedings are quashed. However, quashing of the impugned notice and subsequent proceedings will not debar the assessing officer concerned to issue any fresh notice in future in accordance with law. With the above observations, this Writ Petition being WPO No.1789/2022 is disposed of. This writ petition is being entertained subject to payment of cost of Rs. 5000/- to the High Court Legal Services Committee since the impugned notices under Section 148 of the Income Tax Act, 1961, have been issued both on 28th June, 2021 as appear from records and this writ petition has been filed in March, 2022, that is, almost after eight months from receipt of the impugned notices, without any explanation for such delay in filing this writ petition. Such cost has to be paid by the petitioner to the High Court Legal Services Committee within ten days from date and such cost will be utilised for the benefit and welfare of the children staying with their parents in the

3 correctional home in West Bengal. Receipt of payment is to be produced by the petitioner before this Court. List this matter as “To be Mentioned” on 2nd May, 2022 for compliance. Urgent certified photocopy of this order, if applied for, be supplied to the parties upon compliance with all requisite formalities. (MD. NIZAMUDDIN, J.) TR/

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