SUBHASH BHATIA HUF vs. INCOME TAX OFFICER WARD -47(1) - DELHI & ANR.

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W.P.(C)/14932/2022HC DelhiDLHC01040017202220 December 2022Bench: HON'BLE MR. JUSTICE RAJIV SHAKDHER,HON'BLE MS. JUSTICE TARA VITASTA GANJU2 pages
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What did the High Court hold?

The High Court held that the notice dated June 2, 2022, issued under Section 148A(b), the order dated July 31, 2022, passed under Section 148A(d), and the consequent notice dated July 31, 2022, issued under the amended Section 148 of the Income Tax Act, 1961, concerning Assessment Year 2017-18, could not be sustained. This decision was based on the revenue's concession that since the original notice under Section 148 (unamended provision) was triggered on March 31, 2021, at 7:32:02 PM, the subsequent proceedings initiated under the new regime (Section 148A and amended Section 148) were not applicable. The Court quashed these notices and the order. The writ petition was disposed of in terms of this quashing.

What were the facts?

The petitioner, Subhash Bhatia HUF, challenged an assessment order passed under Section 147 read with Sections 144 and 144B of the Income Tax Act, 1961, dated March 30, 2022. This order was preceded by a notice dated March 31, 2021, issued under the unamended Section 148 of the Act. The revenue, represented by the Income Tax Officer Ward -47(1) – Delhi, was required to ascertain the exact date of service of the Section 148 notice on the petitioner to determine the applicability of the new regime under Section 148A. The revenue confirmed that the Section 148 notice under the old regime was triggered on March 31, 2021, at 7:32:02 PM.

What were the issues?

1. Whether the notice dated June 2, 2022, issued under Section 148A(b) of the Income Tax Act, 1961, and the subsequent order dated July 31, 2022, passed under Section 148A(d), along with the consequential notice dated July 31, 2022, issued under the amended Section 148 of the Act, concerning Assessment Year 2017-18, can be sustained in light of the fact that the original notice under Section 148 (unamended provision) was issued on March 31, 2021. Assessee's Contention: The assessee implicitly argued that the subsequent proceedings under the amended Section 148A and amended Section 148 were invalid as the original Section 148 notice predated the new regime and was issued under the unamended provision. Revenue's Contention: The revenue, after obtaining instructions, conceded that the notice dated June 2, 2022, issued under Section 148A(b), the order dated July 31, 2022, passed under Section 148A(d), and the consequent notice dated July 31, 2022, issued under the amended Section 148 of the Act, could not be sustained.

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

NEUTRAL CITATION NO: 2023/DHC/000119

W.P.(C) 14932/2022

1 of 2

$~4 * IN THE HIGH COURT OF DELHI AT NEW DELHI

Decision delivered on: 20.12.2022 + W.P.(C) 14932/2022 & CM Nos.45972-73/2022

SUBHASH BHATIA HUF

..... Petitioner Through: Mr Ravi Pratap Mall and Mr Shyam Sundar, Advs.

versus

INCOME TAX OFFICER WARD -47(1) – DELHI & ANR.

..... Respondents Through: Mr Abhishek Maratha, Sr. Standing Counsel.

CORAM:

HON'BLE MR. JUSTICE RAJIV SHAKDHER

HON'BLE MS. JUSTICE TARA VITASTA GANJU [Physical Hearing/Hybrid Hearing (as per request)] RAJIV SHAKDHER, J. (ORAL): CM No.45973/2022 1. Allowed, subject to just exceptions. W.P.(C) 14932/2022 & CM No.45972/2022 [Application filed on behalf of the petitioner seeking interim relief]

2.

The record shows that the assessment order was framed qua the petitioner under Section 147 read with Sections 144 and 144B of the Income Tax Act, 1961 [in short, “Act”] on 30.03.2022. 3. The aforementioned assessment order was passed, in the backdrop of notice dated 31.03.2021 issued under Section 148 of the Act [unamended provision]. Digitally Signed By:PREM MOHAN CHOUDHARY Signing Date:09.01.2023 17:14:34 Signature Not Verified

NEUTRAL CITATION NO: 2023/DHC/000119

W.P.(C) 14932/2022

2 of 2

4.

We are informed that Mr Abhishek Maratha, who appears on behalf of the respondents/revenue, was required to obtain instructions with regard to when the aforementioned notice was served on the petitioner. Depending on the date when the notice was served on the petitioner, it would be determined whether the new regime provided under Section 148A of the Act would apply to the petitioner. 4.1. Mr Maratha has obtained instructions to the effect that the notice issued under Section 148 of the Act i.e., the old regime was triggered qua the petitioner on 31.03.2021 at 7:32:02 P.M. 5. Given this position, Mr Maratha cannot but accept that the notice dated 02.06.2022 issued under Section 148A(b) and the impugned order dated 31.07.2022 passed thereafter, as also the consequent notice of even date, i.e., 31.07.2022 issued under amended Section 148 of the Act, cannot be sustained. 6. Accordingly, the prayer made in the writ petition is allowed. 7. The impugned notice dated 02.06.2022 issued under Section 148(A)(b), the order dated 31.07.2022 passed under Section 148A(d) and the consequent notice dated 31.07.2022 issued under Section 148 [amended Act], concerning Assessment Year (AY) 2017-18, shall stand quashed. 8. The writ petition is disposed of in the aforesaid terms. 9. Consequently, the pending application shall stand closed.

RAJIV SHAKDHER, J

TARA VITASTA GANJU, J

DECEMBER 20, 2022/aj Digitally Signed By:PREM MOHAN CHOUDHARY Signing Date:09.01.2023 17:14:34 Signature Not Verified

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