ANNA GOYAL vs. UNION OF INDIA AND ORS

PDF · subscribers
WPO/91/2022HC CalcuttaWBCHCO000105202221 January 2022Bench: HON'BLE JUSTICE MD. NIZAMUDDIN5 pages
AI SummaryAllowed

What did the High Court hold?

The High Court, in view of the common question of law and similarity of facts, heard all the Writ Petitions together. The Court noted that the issues involved were covered by previous judgments of the Allahabad High Court, Rajasthan High Court, Delhi High Court, and its own prior decisions in Manoj Jain and Bagaria Properties and Investment Private Limited. Consequently, the Court declared Explanations A(a)(ii)/A(b) to the Notifications dated March 31, 2021, and April 27, 2021, to be ultra vires the Relaxation Act, 2020, and thus void. All impugned notices issued under Section 148 of the Income Tax Act were quashed. The Assessing Officers were granted liberty to initiate fresh re-assessment proceedings in accordance with the amended provisions of the Act by the Finance Act, 2021, and after complying with all legal formalities. The ratio decidendi is that the retrospective extension of old reassessment provisions through subordinate legislation, beyond the scope of the parent Act, is invalid.

What were the facts?

The petitioners, identified as assessees, are challenging notices issued under Section 148 of the Income Tax Act, 1961. They contend that these notices are barred by limitation and that the respondent Income Tax Authorities failed to comply with the statutory formalities prescribed under Section 148A of the Act, as amended by the Finance Act, 2021, which became effective from April 1, 2021. The challenge is specifically directed at re-assessment notices issued after March 31, 2021. The assessees are also seeking to declare certain Explanations within Notifications No. 20 and 38, dated March 31, 2021, and April 27, 2021, respectively, as ultra vires the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020.

What were the issues?

1. Whether the impugned notices issued under Section 148 of the Income Tax Act, 1961, post-March 31, 2021, are barred by limitation and whether the statutory formalities under Section 148A were complied with, turning on the interpretation of the Finance Act, 2021 and the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. 2. Whether Explanations A(a)(ii)/A(b) to Notification No. 20 [S.O. 1432 (E) dated 31st March, 2021] and Notification No. 38 [S.O.1703 (E)] dated 27th April, 2021, which extend the applicability of Section 148, 149, and 151 as they stood before April 1, 2021, to periods beyond March 31, 2021, are ultra vires the parent legislation, the Relaxation Act, 2020. Assessee's Contentions: The notices are barred by limitation and statutory formalities under Section 148A were not observed. The Explanations in the notifications are ultra vires the Relaxation Act, 2020. They rely on decisions from the Allahabad High Court (Ashok Kumar Agarwal), Rajasthan High Court (Bpip Infra Private Limited), Delhi High Court (Man Mohan Kohli), and the Calcutta High Court itself (Manoj Jain, Bagaria Properties and Investment Private Limited). Revenue's Contentions: No specific contentions for the revenue are recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 149,Section 151

AI-generated summary — verify with the full judgment below

1 IN THE HIGH COURT AT CALCUTTA Constitutional Writ Jurisdiction Original Side Present :- Hon’ble Mr. Justice Md. Nizamuddin W.P.O. No. 446 of 2021 ONKAR LABORATORIES PVT LTD Vs. UNION OF INDIA AND ORS. With W.P.O. No. 484 of 2021, W.P.O. No. 3 of 2022, W.P.O. No. 5 of 2022, W.P.O. No. 7 of 2022, W.P.O. No. 8 of 2022, W.P.O. No. 10 of 2022, W.P.O. No. 11 of 2022, W.P.O. No. 12 of 2022, W.P.O. No. 13 of 2022, W.P.O. No. 14 of 2022, W.P.O. No. 15 of 2022, W.P.O. No. 19 of 2022, W.P.O. No. 21 of 2022, W.P.O. No. 23 of 2022, W.P.O. No. 24 of 2022, W.P.O. No. 33 of 2022, W.P.O. No. 34 of 2022, W.P.O. No. 35 of 2022, W.P.O. No. 39 of 2022, W.P.O. No. 44 of 2022, W.P.O. No. 49 of 2022, W.P.O. No. 68 of 2022, W.P.O. No. 69 of 2022, W.P.O. No. 70 of 2022, W.P.O. No. 71 of 2022, W.P.O. No. 72 of 2022, W.P.O. No. 73 of 2022, W.P.O. No. 74 of 2022, W.P.O. No. 75 of 2022, W.P.O. No. 76 of 2022, W.P.O. No. 77 of 2022, W.P.O. No. 78 of 2022, W.P.O. No. 79 of 2022, W.P.O. No. 80 of 2022, W.P.O. No. 81 of 2022, W.P.O. No. 82 of 2022, W.P.O. No. 83 of 2022, W.P.O. No. 84 of 2022, W.P.O. No. 85 of 2022, W.P.O. No. 86 of 2022, W.P.O. No. 87 of 2022, W.P.O. No. 88 of 2022, W.P.O. No. 89 of 2022, W.P.O. No. 90 of 2022, W.P.O. No. 91 of 2022, W.P.O. No. 92 of 2022, W.P.O. No. 93 of 2022, W.P.O. No. 94 of 2022, W.P.O. No. 95 of 2022, W.P.O. No. 96 of 2022, W.P.O. No. 97 of 2022, W.P.O. No. 98 of 2022, W.P.O. No. 99 of 2022, W.P.O. No. 100 of 2022, W.P.O. No. 101 of 2022, W.P.O. No. 102 of 2022, W.P.O. No. 103 of 2022, W.P.O. No. 104 of 2022, W.P.O. No. 105 of 2022, W.P.O. No. 106 of 2022, W.P.O. No. 107 of 2022, W.P.O. No. 108 of 2022, W.P.O. No. 109 of 2022, W.P.O. No. 110 of 2022, W.P.O. No. 111 of 2022, W.P.O. No. 112 of 2022, W.P.O. No. 113 of 2022, W.P.O. No. 114 of 2022, W.P.O. No. 115 of 2022

2 For the Petitioners :- Mr. Salil Kapoor,Mr. Soumya Singh, Ms. Ananya Kapoor, Ms. Falguni Rambhasha, Mr. Anirudhya Dutta, Mr. Rohit Jain, Mr. Aniket D. Agarwal, Mr. Saksham Singhal, Mr. Subash Agarwal, Mr. Brijesh Kumar Singh, Mr. Avijit Dey, Mr. Pratyush Jhunjhunwala, Mr. Samit Rudra, Mr. Arvind Agarwal, Mr. Farhan Ghaffar, Ms. Susmita Chakraborty, Ms. Amani Kayan, Mr. Zubeen Panday, Ms. Swapna Das, Mr. Siddharth Das, Advocates

For the Respondents :- Mr. Smarajit Roy Chowdhury, Mr. P.K. Bhaumick, Mr. Tilak Mitra, Advocates Dated : 21st January, 2022

MD. NIZAMUDDIN, J. Heard Learned Counsels appearing for the parties. In view of involvement of common question of law and similarity of facts in all these Writ Petitions, with the consent of the parties all these Writ Petitions have been heard together and are being decided by the present common judgement and order. Common facts and issues involved in all these Writ Petitions as appear on perusal of relevant record and upon considering the submissions of the parties are that the petitioners are aggrieved by the issuance of impugned notices under Section 148 of the Income Tax Act, 1961 on the ground that the same are barred by limitation and the respondent Income Tax Authority concerned, before issuing the impugned notices under Section 148 of the Income Tax Act, have not observed the statutory formalities under Section 148 A of the Income Tax Act as prescribed by the Finance Act, 2021 which

3 are applicable with effect from 1st April, 2021 before issuance of notices under Section 148 of the Act on or after 1st April, 2021. Issues arising in all the present Writ Petitions are purely legal and in all these Writ Petitions the assessees/petitioners have sought relief of quashing of the impugned re-assessment notices issued post 31st March, 2021 by the respondent Income Tax Authority concerned under Section 148 of the Income Tax Act, assessees/petitioners have also sought relief by way of a declaration declaring Explanations A(a)(ii)/A(b) to the Notification No. 20 [S.O. 1432 (E) dated 31st March, 2021 and Notification No. 38 [S.O.1703 (E)] dated 27th April, 2021 to the extent that the same extend the applicability of the “provisions of Section 148, Section 149 and Section 151 of the Act, as the case may be, as they stood as on the 31st March, 2021, before the commencement of the Finance Act, 2021” to the period beyond 31st March, 2021 as ultra vires the parent legislation, viz., The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (hereinafter referred to as ‘ Relaxation Act, 2020’). At the outset, all the counsels appearing for the parties jointly submitted that the issues involved in these Writ Petitions are covered by the decision of the Division Bench of the Allahabad High Court dated 30th September, 2021 in the case of ‘Ashok Kumar Agarwal –vs- Union of India through its Revenue Secretary North Block & Ors.’ (Writ Tax No. 524/2021) decided in favour of assessees/petitioners on 30.09.2021 and order of Rajasthan High Court dated 25th November, 2021 in the case of Bpip Infra Private Limited-vs.- Income Tax Officer, Ward 4 (1), Jaipur (S.B. Civil Writ

4 Petition No. 13297/2021) and the order of Delhi High Court 15th December, 2021 in the case of Man Mohan Kohli –vs- Assistant Commissioner of Income Tax & Anr. In (W.P. (C) 6176 of 2021) and judgement and order of this Court dated 17th January, 2022 in the case of Manoj Jain Vs. Union of India & Ors. In WPA No. 11950 of 2021 and in the case of Bagaria Properites and Investment Private Limited & Anr. In WPO 244 of 2021. In view of judgement and order of this Court dated 17th January, 2022 in the case of Manoj Jain Vs. Union of India & Ors. In WPA No. 11950 of 2021 and in the case of Bagaria Properties and Investment Private Limited & Anr. in WPO No. 244 of 2021, all these Writ Petitions herein are disposed of by allowing the same. Explanations A(a)(ii)/A(b) to the Notifications dated 31st March, 2021 and 27th April, 2021 are declared to be ultra vires the Relaxation Act, 2020 and are therefore bad in law and null and void. All the impugned notices under Section 148 of the Income Tax Act are quashed with liberty to the Assessing Officers concerned to initiate fresh re- assessment proceedings in accordance with the relevant provisions of the Act as amended by Finance Act, 2021 and after making compliance of the formalities as required by the law. Urgent certified photo copy of this order, if applied for, be supplied to the parties upon compliance with all requisite formalities. (Md. Nizamuddin, J.) TR/

More judgments on Section 148

All 35,022 judgments and leading authorities on Section 148 →

Recent GST High Court judgments

Search GST case law →