M/s. The Primary Agriculture Co-operative Society Limited Vs… — Income Tax | Telangana HC (2025)

M/s. The Primary Agriculture Co-operative Society Limited Vs… — Income Tax | Telangana HC (2025)

What the court decided

AI extract

Outcome

Writ petition allowed in favour of the assessee on the issue of jurisdiction; the impugned notice/order under Sections 148-A and 148 of the Income Tax Act, 1961 for AY 2015-16 stands set aside/quashed, and consequential orders (including the assessment order dated 18.01.2024 under Section 147 r/w Sections 144 and 144-B) stand set aside/quashed in terms of Kankanala Ravindra Reddy, subject to the outcome of SLP No. 3574 of 2024; no order as to costs; miscellaneous petitions closed.

Issue for consideration

Whether the order under Section 148-A(d) dated 08.04.2022, notice under Section 148 dated 12.04.2022 and the consequential assessment proceedings for AY 2015-16, initiated by the jurisdictional Assessing Officer instead of in a faceless manner as mandated by the Finance Act, 2021 amendments read with Section 151A of the Income Tax Act, 1961 and Notification No.1/2022 dated 29.03.2022, are without jurisdiction. +1 more

Court's answer

The writ petition is allowed in favour of the assessee on the issue of jurisdiction; the impugned proceedings under Sections 148-A and 148 of the Income Tax Act, 1961 stand set aside/quashed.

Ratio / Principle

The consequential orders, if any, stand set aside/quashed in similar terms as in Kankanala Ravindra Reddy; there shall be no order as to costs.

Key takeaways

Allowing of the writ petition is made subject to the outcome of SLP No. 3574 of 2024 preferred by the Revenue against Kankanala Ravindra Reddy; either party may move an appropriate petition seeking revival of this writ petition in light of the Supreme Court's decision in the pending SLP on the same issue.ratio¶102
Observation: the piling up of 600-700 identical writ petitions despite the clear precedent in Kankanala Ravindra Reddy is an alarming docket-explosion trend; the Department's strategy of awaiting the Supreme Court's decision on pending SLPs while continuing fresh proceedings appears to be a calculated move to buy time and circumvent limitation periods.obiter¶64

Detailed headnote1 paragraphs

Telangana High Court (Division Bench of P. Sam Koshy and Narsing Rao Nandikonda, JJ.; order per Narsing Rao Nandikonda, J.) allowed a writ petition by a primary agricultural cooperative society challenging, for AY 2015-16, an order under Section 148-A(d) dated 08.04.2022, a notice under Section 148 dated 12.04.2022, a notice under Section 142(1) dated 02.01.2023 and an assessment order dated 18.01.2024 under Section 147 r/w Sections 144 and 144-B of the Income Tax Act, 1961, solely on the ground of jurisdiction: after the Finance Act, 2021 amendments (w.e.f. 01.04.2021), proceedings under Sections 148-A and 148 had to be initiated and processed in a faceless manner under Section 151A r/w Notification No.1/2022 dated 29.03.2022, whereas the impugned proceedings were conducted by the jurisdictional Assessing Officer. Following its own Division Bench ruling in Kankanala Ravindra Reddy ((2023) 156 taxmann.com 179 (Telangana)), which is under challenge in SLP No. 3574 of 2024, and noting consistent decisions of the Bombay, Gauhati, Punjab & Haryana, Telangana, Himachal Pradesh, Gujarat, Jharkhand, Rajasthan and Calcutta High Courts, and the absence of any interim order of the Supreme Court in the pending SLPs (about 1200 on the same issue), the Court quashed the notices and consequential orders, subject to the outcome of the pending SLPs, with liberty to either party to seek revival. The Court deprecated the continued non-faceless initiations that have piled up 600-700 identical petitions (docket explosion), observing the Department's conduct appeared to be a calculated move to buy time and circumvent limitation, and reiterated, via Bank of India v. Assistant Commissioner, Income Tax (quoting Union of India v. Kamlakshi Finance Corporation Ltd.), that revenue officers are bound by decisions of higher appellate and judicial authorities unless their operation is suspended by a competent court. The Revenue's right to initiate fresh proceedings under the substituted provisions remains reserved as per paragraphs 36-38 of Kankanala Ravindra Reddy.

134471

Ar HYDERABAD

rN rHE^HrGHcouRr [s?:Jlrl?Iili iJ.:5,:t:fi-^

WEDNESDAY,^{THE SIXTEENT1DIJOF JULY} rwo rnciusnND^{ANDTWENTYFlvE}

PRESENT

THE HONOURABLE^{SRI J-USTICEP'SAM KOSHY} AND THE HoNouRABLE^{sRl'r usrii'iuanslNcRAo NANDIKoNDA}

WRIT^{PETITI ON NO:20523 OF2025}

""""J:. The Primary^{Agriculture-.co-oP.erativ-e-society Limited'rep by} its secretary,^{rtrr..rvr'roo?Xi Viiil]'-el}ut'fu iturnabad-So3-221' Telansana

..PETITIONER

AND

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1 A::H]{t:l3i}liJ"f i"HJfi 1,,"J,'.H,:fl',"}i:lR:fl ':3.?::ffiTRi:"'"831f; 003

2 Assistant Commissioner^{of lncome Tax - Circle 1' Aayakar Bhavan' 6-2-} GBi:,'d;ti;;n^{r'rig", Nizamabad - 503002'}

,l Principar^{chief commiss'P1:!:l'J3flT.i""%} Tf, Tfl 5;E:Sl'.o3[l,r ro*"|.,, IBtg3i,1^{H,1TA1*1$6ooo}

or rndia'

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...RESPONDENTS

PetitionunderArticle226ollheConstitutionoflndiaprayingthatinthe circumstances^{stated in the affidavit filedtherewith'the High Court may be} pleased to^{issue a Writ of Mandamusor any other appropriate writ' order or} direction^{decraring the order'passed by 2nd Respondent undersection 148-A(d)} dated^{8.4.2O22and notice under Section148 of the lncome Tax Act' '1961' dated} 12.4.2022,^{for the assessment year 2015-16as being without jurisdictionand} contrary to^{faceless assessment procedure laid downin Section 144-8 of the} rncome^{Tax Act .1961 and consequenfly(b)to set-asidethe consequentiarnotice} daledo2.ol.2023issuedbythelstRespondentunderSection142(1)oflhe lncomeTaxAct,lg6landtheconsequentialorderdatedlB.0l.2024issuedby

the lst Respondent under Section 147 rcad with Sections 144 and 144_B of the lncome Tax Act' 1g61 for the assessment year 2015-16 as being without jurisdiction' arbitrary, iregar, bad in raw, void-ab-initio, apart from being viorative of Articres 1a, 19(1xg) and 265 0f the constitution of rndia and contrary to faceress assessment procedure raid down in section .144-B of the rncome Tax Act 'l 961.

lA NO:'t oF 2025

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 pleased to grant stay of a' further proceedings, incruding any recovery, pursuant to the impugned order dated rB.'r .2024 issued by the 1 st Respondent under section 147 read with Sections 144 & 144-B of the rncome Tax Act, 1961 for the assessment year 2015-16, pending disposar of the writ petition as othenrrise the Petitioner will be put to severe loss and hardship.

Counsel for the petitioner : SRI S.VlJAy ADITHYA

Counsel for the Respondents No.1to3 : Ms.J.SUNITHA, SC for lT DEPT

Counsel for the Respondents No.4 : SRI G.NARESH,

rep., SRt A.KRANTH| KUMAR

The Court made the following; ORDER

THE HONOURABLE^{SRI JUSTICE P'SAM KOSHY'} AND THE HONOURABLE^{SRT JUSTICE NARSING RAO} NANDIKONDA WRIT^{PETITION No. 20523 oF 2025 /}

gBDEB' @cr^{1lon ble Sri} 'lusrice^{NursingRao Nandikonda)}

Heard Mr'^S 'Vijay^{Adithya'learned counsel forthe} petitioner,^{Ms. J.Sunitha, learnedSenior Standing Counsel for the} Income^{Tax Department appearing for respondent Nos' I to 3 and} Mr.G.Naresh,leamedcounselrepresentingMr.A.KrantiKumar Reddy,^{leamed counsel for respondent No'4' Perused the record'}

This is a^{writ petition where the proceedingsare either} chatlenged^{to the notices which were issued under Section1484.} andt48oftheIncome.I.axAct,lg6l(forshort.theAct')orthe assessmentordersthosehavebeenpassedunderSectionl4Tof the Act^{whichhave been assailed'}

This writ^{petition is being takenup todayonly on one of the} grounds, that^{the noticesissuedunder Section l48A of the Act} and the subsequent^{initiation of proceedings underSection148 of} the ,&t-pl the^{jurisdictional AssessingOfficer'whereasin terms} of the amendment^{that was brought to the IncomeTax Act by way}

2

of Finance Act, 2O2l w.e.f., 0l .04.2021 onwards, proceedings under Section l4gA of rhe Act as also under Section l4g of the Act ought to have also been issued and proceeded in a faceless manner

The contention of the petitioner is that the issue of proceedings being in violation of the Financ e Act, 2021 i.e., the impugned notices under Section l4gA and Section l4g of the Act not being issued in a faceless manner, have already been dealt with and decided by this Court in the case of IC{NKANALA RAVINDRA REDDY vs. INCOME_TAX OFFICERT decided on 14.09.2023 whereby a batch of writ petitions werc ailowed and the proceedings initiated under Section l4gA as also under Section 148 of the Act were held to be bad with consequential reliefs on the ground of it being in violation of the provisions of Section l5lA of the Act read with Notification lgl2022 clated, 29.03.2022. l_he said judgment passed by this Court has also been subsequently followed in a large number of writ petitions which were allowed on similar terms.

'[(2023) 156 taxmann.com I 7g (Telangana)]

3

5 Down^{the line, we find that the same issue has alsobeen} various^{High Courtst'e'.,} decided^{against the RevenuebY} the^{case of HEXAWARE} by the^{BombaY High Cour tn} TECHNOLOGIES^{LTD.,VS. ASSISTANT COMMTSSIONER} OF INCOME^{TAX & OTHERS2'Gauhati High Court in the case} of RAM^{NARAYAN SAH vs' UNION OF INDIA3' Punjab and} Haryana^{High Court in the case of JATINDERSINGH BANGU} vs. uNION^{oF INDIA4, and TelanganaHigh court in the case of} SRT VENKATARAMANA^{REDDY PATLOOLAVS. DEPUTY} COMMISSIONER^{OF INCOMETAX5 wherethe issue was in} respect^{of intemational taxation' BombayHigh Court in the case of} ABHIN^{ANILKUMARSHAHVS. INCOME TAX OFFICER,} INTERNATIONAL^{TAXATION6 whichis againon intemational} taxation^{and central circte' High Court of HimachalPradeshin the} vs. INCOME^{TAX OFFTCER7,} case of GOVIND^SINGH Gujarat^{High Court in the case ol} MANSUKHBHAI

't20241464^{ITR 430 (Bom)}

'ipOzU^{156 taxmann.com 478 tCauhati)I}

"iQOZq^{165 taxrnann.com 115 (Punjab & Haryana)l} '12024)^{167 taxrnanqcom41 1 (Telangana)l} " 12024)^{166 taxmann.com 679 (Bornbay)l}

'iZOZ+j^{165 taxmann.com113 (HimachalPradcsh)l}

I

4

DAHYABITAI RADADIYA vs. INCoME TAx OFFICER, WARD 3(3X5)8, Jharkand High Courr in rhe case of SHyAM SUNDAR SAW vs. tjNION OF INDIAe, Rajasthan High Court in the case of SHARDA DEVI CHHAJER vs. INCOME TAX OFFICER & ANOTHER and barch of writ petirionsro which stood decided on 19.03.2024. Similar views have also been taken by the Division Bench of Calcutta High Court in the case of GIRDHAR GOPAL DALMIA vs. UNION OF INDIA & ORS (M.A.T 1690 of 2023),decided on25.09.2024.

Even though the same issue having been decided by a large number of F[igh Courts, we are stilI confronted with large tiling of identical matters on daily basis ranging between -s to l0 writ petitions. That upon the instructions being sought fiom the Department, they have been taking a solitary ground rhar rhe decision of the Bombay High court in the case or- Herawore Technologies Ltd., (2 supra) as also the one which has been decided by this Courl in the case of Kanakala Ravindra Reddy

"2021 .\ SCC OnLirre Gu.i 40t2 '202-5 SCC Onl_ine Jhar 2g7 'uJ2023, RJ-JD:4984-DBl

5

(1 supra) has^{been subjected to challengein a SpecialLeave} Petition^{i.e., SLP No.3574 of 2024 belore the Hon'bleSupreme} Court and^{the Hon'bteSupreme Courl is seized of the matter'} In addition,^{thereare about1200SLPsalso fited arising out of the} same issue^{being decided by various High Courts'}

To a query^{being put to the learned counsellor the Revenue'} they have^{categorically acceptedthe fact that thereis no interim} order^{grantedby the Hon'bleSupremeCourt in any of these} matters^{pendingbetbre it'Meanwhite'liesh writ petitions of} identical^{natureare being pitedup before this Bench on dailybasis} and the^{pendency is gettingincreasedon matterwhich otherwise} has already^{been dealt and decided by this very HighCourl itself'}

On the^{one hand, even though the order ol this Court that} was passed^{as earlyas on 14'09'2023and more [6 monthshave} lapsed, till^{date, we do not f,rnd any remedial steps havingbeen} taken by^{the lncome Tax Departmentto take appropriatestepsto} either hold back^{issuanceof notice under Sectionl48A and under}

Section 148 of^{the Act by the jurisdictional AssessingOfficer'} rather the authorities^{concemed in the teeth of series of decisions}

5

by all the major High Courts in India are continuously still initiating proceedings under Section 148,.{ of the Act and also initiating proceedings under Section 148 of the Act in contravention to the amendments brought into the [ncome Tax Act pursuant to the F-inance Act,2020 as also the Finance Act2021.

Upon a query being put as to why can't this writ petition be disposed of in the teeth of the decision rendered by this Court in the case of Ktnakala Ravindra Reddy (l supra), learned Standing Counsel lbr the Income Tax Department contends that those would unnecessarily burden the Income Tax Department where they would be recluired to file equal number of SLps before the Hon'ble Supreme Court and it would be further burdening the exchequcr o1- the Union of India. It was also the cont.ention of the leamed Standing Counsel that no prejudice would be caused to the interest of the petitioners in case if this writ^petition is kept^pending till the f'rnalization of the SLPs pending before the Hon'ble Supreme Court and the fact that the petitioner is already enjoying the benellt ol'interim protection. Nonetheless, on the earlier query of this Court as to why the Income Tax Department have not come out with a lncchanism to issue appropriate instructions or to take

7

f

' ing that^{proceedingsunder Section 1484} appropriate^{stepsln ensur} of the Act^{as also the assessment orders underSection148 of the} Act are^{kept in a hold in the light ofthe decisions dedcidedby the} various^{High Courts,it was submitted by the learned Standing} Counsel^{that the said steps can only be takenat the levelof CBDT} as any^{suchsteps would have to be taken Pan India and cannot be} tirnited^{to anyof these jurisdictionalHigh Courts'}

l0.Asaresultofwhich,whatwearef.acingissteepincreaseof litigation^{day in and day out even though various orders have been} passed by^{this High Courtallowing writ petitions on the very same} issue.^{The lncomeTax authorities concemed are sti[[ even now in} 2025 also^{initiating proceedingsin contraventionto the provisions} of Section^{151A of the Act andas a result by now' more than 600} to 700^{petitions have been already got piled up beforethis High} Court^{on an issuewhichotherwise standssquarely coveredby the} judgment of this^{Courtin the case of KanakalaRavindra Reddy} (l supra). What^{is alsb surprising is the fact that though while} allowing^{the writ petitions in the case of KunakalaRuvindra} Retldy^{(l supra),the DivisionBenchwhite reserving the right of} the Revenue,^{has also protecte<Itlre interest of the petitioners}

8

insofar as the liberty which was granted to the Revenue for initiating riesh proceedings strictly in accordance with the amended provisions of tl-re Act, as amended by the Finance Act, 2020 and the Finance Act, 202r.^'fhe petitioner assessee wourd bc entitled to challenge or raise the other legal objections if the Revenue i,itiates fresh proceedings. The Department has made no endeavour in availing the said liberty that was reserved for the Revenue. On the contrar,, thev have been still sticking on to the stand, which this High Courr as well as many other High Courts already held to be bad.

Ir appears that because of the aforesaid libety rhat this High Court had granted permitting the Revenue for initiating fresh proceedings as a one-time measure in a faceless rnanner, the Income J'ax Department wants to take eidvantage o1. the same by protracting these pr.ocecdings which would enable them to meel the limitation thar would orherwise come in the way. Likewise, il the writ petition is kept pending for a considerable long period of time and finally at a later stage if the Hon,ble Supreme Cotrrt confirms the decision taken by this High Courl as also by the other High Coufis in wh ich the SLps are still pending, the I ncome l.ax

9

Department^{would get the advantageof the liberty that is otherwise} protected^{in favour of the Revenue for initiation of fresh} proceedings^{fromthe disposal of these matters at a much laterstage} which^{wouldbe advantageousand beneficialto the Revenueand} would be^{equatly disadvantageous and detrimental so far as interest} oi the^{assesses are concemed' As a consequence' the Income Tax} Dcpaftment^{gets an extendedperiod of time fbr initiation of fresh} proceedings.

The^{alarming trendof docketexplosion in this Court' despite} the clear^{precedentset in Kanakala RavindraReddy (t supra)' is a} matter of^{grave concem'The Income Tax Department's persistent} initiation^{of iresh proceedings' disregarding the established iudicial} pronouncements,^{has ied to an unprecedentedsurge in litigation} with over^{600-700 petitions piling up on the same issue'This} deliberate^{approachnot only undermines the principleof judicial} precedent^{but also strainsthe judicial resourcesunnecessarily''fhe} Department's^{strategyof awaiting the SupremeCourt's decision on} pending SLPs^{while continuingto initiate fresh proceedings} appears to be a^{calculated move to buy time and circumvent} lirnitation periods,^{rather than adhering to the establishedlegal}

10

posltlon. Such conduct raises serious questions about the administratrve efficiency and the respect for judicial pronounceurents, particularly when this Court has already provided a balanced approach by preserving both the Revenue,s rights and assesses rnterests

Another aspect rvhich needs to be considered is that in fact it should havc been realized by the tncome Tax Department itself and should have fbund out via media in ensuring that proceedings under Sections l4g-A and l4g should not have been issued in a faceless rnanner. at least tilt the Hon,ble Supreme Court decide the twelve hundred ( I200) odd Sl_ps which it is already seized of or, at least the Inconte Tax Department should have found out some remedial steps to ensure that wherever the authorities intend to initiate proceedings under Sections l4g_A and I4g, other than in a faceless manner, the proceedings should have been defened without precipitating the matter further intimating the assessee that they shall initiate appropriate proceedings only after the SLp,s are decided by the Hon,ble Supreme Court on the very same issue. This again, the [ncome Tax Department, has not been able to give a convincing reply. ercept for the lact that such a decision if at all

11

f

has to be^{taken,hasto be taken for the wholeof India' and which} otherwise^{has to be by way of a policydecision and that too at the} level of Central^{Board of Direct Taxes' Though the leamed} Standing Counsel^{lor the Income Tax Departmentcontendedthat} the Delhi High^{Court dismisseda writ petition of similar nature' on} the one hand^{when the High Court is strugglingto reduce its} pcndency, such^{noticeswhich are under challenge in this writ} petition are forcing^{the assesseeto knock the doors of this High} Court resulting^{in hling of hundreds of new writ petitionswhich in} the long run^{not only affects the disposalof the writ petitions but} also consumes^{substantial time of the Bench in hearingthese} matters again^{and again on daily basis' Admittedly' in spite of the} matter befbre the^{Hon'bleSupreme Courthaving been taken on} many occasions,^{the Hon'bleSupreme Court which is seizedof the} matter has been^{reluctantin granting any interim protectionto the} lncome Tax^{Department. Yet, the authorities concemedat the} State level are^{not ready to acceptthe verdictpassed by a majority} of High Courts^{of diff'erentStateson the same issue; and to make} things further^worse, the^{Income Tax Department is showing} audacity by issuing notices^{continuouslyunder Sections148-A and}

72

148 through the jurisdictional Assessing Officer whereas it ought to have been only in the faceless manner.

l,4. In rhe case of BANK OF INDIA vs. ASSISTANT COMMISSfONER, INCOME TAXr, on an issue whether it was justifiable on the part ol the Income Tax Department in not following an order passed by the adjudicating authority only on the ground that the appeals are pending, the Division tsench of the High Court of llombay held at paragraph No.25 as under, viz., :

"25. Ivlr.^paridwalla has righfly drawn out attention to the decision of this Court in Commissioner of lncome Tax vs. Smt. Godavaridevi Sarafr2 as also the recent decision of the co_ ordinate Bench of this Courl in Samp Furniture (p) Ltd. v. lTOr3 of which one of us (Justice G s. Kurkarni) was a member wherein the Court categorically observed that the Revenue having not "accepted" the judgment of the Hrgh Court would not mean that till the same is set aside in a manner known to law, it would loose its binding force Referring to the decision of the Supreme Court in Union of lndia vs. Kamlakshi Finance Corporation Ltd.r4, the court observed that the apprcach of the officiars of Revenue of treating decisrons being^,,not acceptable,, was criticized by the Supreme Court. ln such decrsion, following are the relevant observations made by the Supreme Court.

',', 1r.z^o_z1.l n o t,-\ m a n n. c o r n 4 2 I ( B o m h a y ) I " il9781 lll It-t( 58e 1B666ar)

'' 120241 165 raxrnann.corn 5gl/j00.I-axman 452 (Bombay) 'o ]l9921raxmann.corn l6l-55 ELl.433 (SC)

13

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"6. Sri Reddy is^{perhapsright in saying that the} officers^{were not actuatedby any malafidesin} passing the^{impugnedordersTheyperhaps} genuinety felt^{that the claim of the assesseewas not} tenable^{and that, if it was accepted' theRevenue} would suffer.^{But what Sri Reddy overlooksis that we} are not^{concernedhere withthe correctnessor} otherwise of^{their conclusion or of any factual} malafides^{but withthe fact that the officers' in reaching} in their conclusion,^{by-passedtwoappellateorders in} regard to^{the same issue which were placedbefore} them, one^{of theCollector (Appeals) andtheotherof} the Tribunal.^{The HighCourt has' in our view' rightly} criticized^{this conduct of the AssistantCollectorsand} the harassment^{to the assessee caused by the failure} of these^{officers to giveeffectto the ordersof} authorities^{higher to themin the appellatehierarchy lt} cannot be^{too vehemently emphasizedthat it is of} utmost^{importancethat, indisposingofthe} quasiiudicial issues^{beforethem' revenueofficers are} bound by^{the decisionsof the appellateauthorities} The order^{of the Appellte Collector is binding on the} Assistant^{Collectors workingwithin his jurisdiction and} the order^{of the Tribunal is binding upon the Assistant} Collectors^{and the Appellate Collectors whofunction} under the^{jurisdiction of the TribunalThe principles of} judicial discipline^{requirethat the ordersof thehigher} appellate authorities^{should be followedunreservedly} by the subordinate^{authorities The mere fact that the} order of the^{appellate authority is not "acceptable" to} the department -^{in itselfan objectionable phrase -} and is the subject^{matterof an appealcan furnish no} ground for not following^{it unless its operationhas} been suspended^{by a competentcourt lf this healthy}

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rule is not followed, the result will only be undue harassment to assesses and chaos in administration of tax laws.

tl We have dealt with this aspect at some length, because it has been suggested by the learned Additional Solicitor General that the observations made by the High Court, have been harsh on the officers. lt is clear that the observations of the High Court, seemingly vehement, and apparenfly unpalatable to the Revenue, are only intended to curb a tendency in revenue mafters which, if allowed to become widespread, could result in considerable harassment to the assesses_pubIc wrthout any benefit to the Revenue. We would like to say that the department should take these observations in the proper spirit. The observations of the High Court should be kept in mind in future and the utmost regard should be paid by the adjudicating authorities and the appellate authorities to the requiremenls of judicial discipline and the need for giving effect to the orders of the higher appe ate authorities which are brnding on them."

I 5. What is worrying this Bcnch rnore is the lact that an

endeavour is being made whore heartedty to ensure not to generate further litigation on issues which have been laid to rest by a large number of High courts all of whom have taken a consistent stand that the action of the rncome Tax Depaftment. being violative of the

15

9

,/

Finance^{Act,2020andFinance Act' 2O21' Now' in order to protect} the interest^{of the Revenue as alsothat of the assessee' it would be} trite^{at this juncture'if we disposeof the writ petition with an} observatiorvdirecrion^{that the disposaloftheinstantwrit petition in} terms^{of the judgment renderedby this High Court in the case of} Kankanala^{RavindraRetldy (1 supra) shalt however be subiectto} the outcome^{of the SLPs which were filed by the Income Tax} Department^{and which is pending consideration before the Hon'ble} SuPreme^Court'

16.^{[n the given facts and circumstances'this Bench is of the} considered^{opinionthatunless and until we do not timelydispose} of matters^{whichare squarely coveredby the decisionof this Court} and^{which standsfortit-red by the decisionsof the variousother} High^{Courtson the veU same issue'the' pendency of this High} Court^{would further be burdened which otherwise can be decided} and^{disPosed of as a covered matter}

t7. So far^{as the interest of the Revenue ls concemed, we are of} the considered^{opinion that the interestof the Revenue hasalready} been^{considere<land protected' as has beenobserved in paragraphs}

16

36,37 and 38 of the order which, for ready ref.erence, is reproduced

hereunder

For all the aforesaid reasons, the impugned notices issued and the proceedings drawn by the respondent_ Department is neither tenable, nor sustainable. The notices so issued and the procedure adopted being per se illegal, deserves to be and are accordingly set aside/quashed. As a conse all the impugned orders getting quashed, ,n" "o'un""' by the responder,-r"r".r#,T^"r::1 ;";: ffi::: issued under Section 141 quashed and * is oro"r"o ,"ld,olffTl: ,:j::" 1: are quashing the consequential order is on the principles that when the initiation of the proceecjings itself was procedurally wrong, the subr sequent orders also gets nurified automaticafly.

The preliminary objection raised by the petitroner is sustained and all these writ petitions stands allowed on this very jurisdictional issue. Since the impugned notices and orders are getting quashed on the point of jurisdiction, we are not inclined to proceed further and ddcide the other issues raised by the petitioner which stands reserved to be raised and contended in an appropriate proceedings.

38 Since the Hon'ble Supreme Court had, in lhe case of Ashish Aganval, supra, as a one_time measure exercrsing the powers under Article 142 of the Constitution of lndia, permitted the Revenue to proceed under the substituted provisions, and this Court allowing the petitions only on the procedural flaw, the right

77

t I

{:

conferred^{on the Revenuewould remainreserved to} Oro.""O^{f u rthe r if tn"" "^} t, -1,'n order^{of the Supreme Cot} l'T "":::":^{;:^:::} Agarwal,^suPra'

18.^{We wouldonly fufther like to make observationsthatsince} we are^{inclinedto disposeof the instant writ petition' consciousof} the^{fact that the earlier order of this High Court in the case of} Kanokals^{RavindraReddy (lsupra)is subiectedto challenge} before^{the Hon'ble SupremeCourt in SLP No'3574of 2024'} preferred^{by the lncome Tax Department' we rnake it clear that} allowing^{of the instantwrit petition is subject to outcome of the} aforesaid^{s,-p preferredby the Revenue againstthe decisionof this} High^{Court in the case ol Kanakalu RuvindrsRerlr/y (1 supra)'} This,^{in other words'wouldmean that either of the parties'if they} so^{want, may move an appropriate petitionseekingrevivalof this} writ Petition^{inthe light of the dccisionof the Hon'ble SuPreme} Court^{in the pending SLP on the verysame lssue}

19,^{AccordinglY'the instant wrttpetition stands allowed in} the^{issue of jurisdiction is} favour^{of the assesseeso lar as} the^{imPugnednotice under} concemed.^{As aconsequence'} challenge^{under Sections148-Aand 148 stands set aside/quashed}

18

(

The consequential orders, if any, also stand set aside/quashed in

similar terms as have been passed by this High Court in the case of Konkqnala Ravindra Reddy (l supra). There shalt be no order as

[o costs.

Consequently, miscellaneous petitions pending, if any, sl.rall

stand closed.

SD/. L. LAKSHMI BABU DEPUry REGISTRAR

//TRUE COPYII

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WP.No.20523 of 2O2S

ALLOWING THE WRIT PETITION
WITHOUT COSTS
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