Allowed

Ramesh Kumar Agarwal v. Assistant Commissioner of Income Tax

Telangana HC23 Sept 2024WP/26133/2024

Case brief

AI extract

What is this about?

Reassessment notice under Section 148 challenged as issued contrary to the Finance Act, 2021 procedure. Following the Court's common order dated 14.09.2023 in W.P.No.25903 of 2022, by consent the impugned show cause notice and consequential orders were set aside and the writ petition was allowed.

What did the court decide?

Impugned Section 148 show cause notice and consequential orders set aside; liberty reserved to parties per paragraph 38 of the order dated 14.09.2023 in W.P.No.25903 of 2022.

Ramesh Kumar Agarwal Vs Assistant Commissioner of Income Tax — Income Tax | Telangana HC (2024)

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[³⁴¹¹ ]

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HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

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MONDAY, THE TWENTY THIRD DAY OF SEPTEMBER TWO IHOUSAND AND TWENTY FOUR

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PRESENT

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THE HONOURABLE SRI JUSTICE SUJOY PAUL AND

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THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO

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WRIT PETITION NO: 26133 OF 2024

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Between:

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Ramesh Kumar Agarwal, S/o: Badrilal Agarwal, Erstwhile partner of Kamala lnternational(Dissolved Firm). Aged about 71 years, Occupation - Business, # H. No. 8-2-2931821N852, Road No.44, Jubilee Hills, Hyderabad - 500033.

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...PETITIONER

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AND

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1 Assistant Commissioner of lncome Tax, Circle 8(1), Hyderabad, Signature Towers, Sy.No.6(P) of Kondapur, Sy.No.37(P) of Kothaguda, OPP. Botanical Gardens, Serlingarnpally, Ranga Reddy, Hyderabad, Telangana - 500084.

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2 The Chief Commissioner of lncome Tax AP and TS, 1Oth Floor, C-Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004.

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...RESPONDENTS

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Petition under Arlicle 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an appropriate writ order or direction more particularly one in the nature of Writ of Mandamus, declaring the notice u/s^'148 dt. 2910812024 vide DIN No. ITBtuAST/S/148_112024-2511068104688(1) issued by the JA0(1st respondent) instead of Faceless Assessing Officer(FAO) for A.Y. 2018-19, that too to a non-existent entity, which was dissolved on 2210712014, as void, illegal, and contrary to the provisions of lncome{ax Act and contrary to the Principles of Natural Justice.

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lA NCr: 1 OF 2024

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Petition under section '151 cpc praying that in the circumstances stated in the afFidavit fired in support of the petition, the High court may be preased to stay all furlher proceedings pursuant to the notice u/s 14g dt. 2g/o}r2o24vide DrN No. IrBA/\ST/S/148-1r2024-2st1o68i046s8(1) issued by rhe JAO(1st respondent) instea,l of Faceless Assessing Office(FAO) for A.y. 2018_19.

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Couns,el for the Petitioner: SRI DUNDU MANMOHAN

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Counsel for the Respondents: MS. BOKARO SAPNA REDDY (Jr. sc FoR tNCoME TAX)

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The Court made the following: ORDER

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,,.,, ,,

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THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESENIAR RAO

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WRIT PETITION No. 26t33 0F 2024

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ORDER: (per Hon'bte Sri Justice Sujog paut)

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Heard Sri Dundu Manmohan, iearned counsel for the petitioner(s) and Ms. B. Sapna Reddy, learned Junior Standing Counsel for Income Tax Department, for the respondents.

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The ground taken by the learned counsel for the petitioner(s) is that in furtherance of Financ e Act, 2021, reassessment process stood modified but the respondents have not taken care of it and therefore, notice issued under Section 148 of the Income Tax Act, 196 1 cannot sustain judicial scrutiny. Since notice is bad in law, the consequential orders are also bad in law.^'

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During the course of hearing, learned counsel for the parties agreed that curtains on this issue are finally drawn by this Court in a batch of writ petitions, W.p.No.25903 of 2022 and other connected matters, decided by common order dated 14.09.2023. The parties agreed that this ma.tter may be disposed of in terms of the Comrnon Order dated 14.O9.2023.

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This Court in the said order^{datedl4-O9.2O23rn}

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W.P. \o.25903 of 2022,^{heldas under:}

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"35.^{Ia view of the aforesaid discussions,itis by nowvery} clear that the^{procedureto be follorred by the respotrdent-} DepartEent upon treatiEg the^{noticesissuedforreassessment} being ulrder Section^148A, the^{subseque[tproceedings was} ruaDdatorily requited to^be uldertaken^{uEder the substituted} provisions as taid dowa uEder the Finarce Act,2021.^{In the} absence of c,hlch, se are^{constraiaed tohold that the} procedure adopted by the respondetrt-DePartmert^isin contraveEtio! to the statute^i.e. the^{FitranceAct,2o2l' at tlre} tirst iastance. secondly, it is^{also in direct cootraveEtionto} the directives issued by the llon'ble^{Supreme Courtin the} case of Ashish Agarwal'^suPra.

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For atl the aforesaid^reaaons, the^{inpugnedDotices issued} aDd the proceedings drawn by the^{respoadent-DepartmeDtis} nelther tenable, nor^{sustainable.The notices so issuedarrd} the^procedure adoPted^{beitrgpet se illegal,deserves to be and} are accorditrgly set^{aside/quashed.As a colsequetrce,all the} impugned orders^{gettingquashed,the consequertialorders} passed by the respondent Department^pulsuaat to the^notices iasued under Section 14? and^{148would also get quashed and} it is ordered accordiogly. The reasot^{we arequashilgthe} consequential ordet is o! the^{pri[ciplesthat when the} initiation of the^{proceediltgsitself was procedurally wioag'} the subsequent orders also^{gets auuifiedautotratically.} 3?. The preumiE.ry objection raised^{by the petitioneris} Euataitred and all these writ^{petitions staadsaUowedon this} very lurisdictional isaue. Siace the^{impugred lroticesaad} orders are gettirg^quashed on the Poiut^{of jurisdiction, we are} not iucllled to^proceed further and^{decide the othetissues} raised by the^petitioner which^{stands reserved to be raised} aad couteaded ia alr appropriate^proceedings.

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Since the Ho!'ble Supt'eEe Court^{had,i!thecaseof} Ashish Agarc/al,^{supra, as} a one-tiEe^{measureexercising the} powera utrder Article 142 of the Constitution^ofIndia, permitted the Revenue to proceed u!de. the substituted provlsions, aud this Court allowing the Petitions only^{on the} procedural flaw, the right colferted olr the^{Revenue would}

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retDain reserved to proceed further if they so waat from the stage of the order of the Supreme Court ia the casc of Ashish Agarwal, supta.

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No order as to costs.-

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In view of the consensus arrived, the impugned Show Cause notice and consequentia_l orders passed in this writ petition zre set aside. Liberty is reserved to both the parties to take respective stand and to proceed in accordance with law as per paragraph No.38 ofthe order dated 14.09.2023 in W.P.No.25903 of 2022.

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The Writ Petition is a_llowed. No costs. Interlocutory

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applications, if any pending, shall also stand closed.

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; SD/. T, TIRUMALA DEVI 1 ASSISTANT REGISTRAR //TRUE COPY// SECTION OFFICER

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To,

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'1 . Assistant Commissioner of lncome Tax, Circle 8(1), Hyderabad, Signature Towers, Sy.No.6(P) of Kondapur, Sy.No.37(P) of Kothaguda, OPP. Botanical Gardens, Serlingarnpally, Ranga Reddy, Hyderabad, Telangana - 500084. 2. The Chief Commissioner of Income Tax AP and TS, 1Oth Flbor, C-Block, l.T. Towers, 10-2-3, A.C. Guards, Hyderabad-500004.

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One CC to Sri Dundu Manmohan, Advocate IOPUC]

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One CC to Ms. Bokaro Sapna Reddy (Jr. SC for lncome Tax) [OPUC] l 5. Two CD Copies T J ,W

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HIGIH COURT I

SP,J & RRNJ

DATED:2310912024i

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ORDER II

WP,No.26133 of 2024

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ALLOWING THE WRIT PETITTON
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WITHOUT COSTS
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Ramesh Kumar Agarwal v. Assistant Commissioner of Income Tax

Case brief

What is this about?

What did the court decide?

Ramesh Kumar Agarwal v. Assistant Commissioner of Income Tax

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

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