Dismissed¶¶88

M/s Mandava Holdings Private Limited v. Union of India

Telangana HC1 Dec 2025WP/21770/2024

Case brief

AI extract

What is this about?

Writ petition under Article 226 dismissed for non-maintainability where statutory appeal under Section 260-A Income Tax Act available; petitioner invoked appeal for subsequent year but not for year in question; court refused to act as appellate court over ITAT; exceptions in Chhabil Dass Agarwal not satisfied.

What did the court decide?

The writ petition is not maintainable because an efficacious statutory remedy of appeal under Section 260-A of the Income Tax Act is available, and the petitioner has not availed it for the assessment year 2016-17, whereas for the subsequent assessment year 2017-18 the petitioner did file an appeal under Section 260-A. ¶¶79

M/s Mandava Holdings Private Limited Vs Union of India — Income Tax | Telangana HC (2025)

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

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I^s48s ]

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MONDAY,THE FIRST DAY OF DECEMBER TWO THOUSAND AND TWENW FIVE

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PRESENT

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THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND

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THE HONOURABLE SRI JUSTICE SUDDALA CHALAPATHI RAO

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WRIT PETITION NO: 21770 OF 2024

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Between:

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M/s Mandava Holdings Private Limited, Hyderabad Office at D. No, 8-2684121A, NSL ICON, 4th Floor, Plot No. 1 to 4, Road No.^'12, Banjara Hills, Hyderabad, Rep. By Authorized Signatory, Asha Priya Mandava

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...PETITIONER

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AND

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1 Union of lndia, tr/inistry of Finance Rep. by its Secretary, 166-8 North Block, New Delhi - 1 10 001 .

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2 Deputy Commissioner of lncome Tax Central, Circle-1(2), Hyderabad 7th Floor, Aayakar Bhavan, Basheerbagh Hyderabad-500004

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J, The Priniipal Commissioner of lnc-ome'Tax - Central, Hyderabad 7th Floor, AayakarBhavan,BasheerbaghHyderabad-500004.

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...RESPONDENTS

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Petition under Article 226 of lhe Constitution of lndia praying that in the ciriumstances stated in the affidavit filed therewith, the High Court may be pleased to i. lssue a Writ, Order or Direction more particularly, in the nature of Writ of Certiorari, setting aside the Orders of the Lower Authorities as lacking in jurisdiction, being against the law laid down the Hon'ble Supreme Court in PCIT vs Abhisar Buildwell ii. Set aside the consequent orders and proceedings for recovery of demand including the consequent penalties levied

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lA NO: 2 OF 2024

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Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to stay the demand and keep in abeyance the recovery proceedings pending adjudication of this Writ Petition

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Counsel for the Petitioner: SRI P. SOMA SHEKAR REDDY

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Counsel forthe Respondent No. 1: SRI N. BHUJANGA RAO, DEPUTY SOLICITOR GENERAL OF INDIA

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Counsel for the Respondent Nos. 2&3: SRI N. PRAVEEN REDDY, SENIOR SC

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The Court made the following: ORDER

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I I

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THE I{ON'BLE SRI JUSTICE P.SAM KOSHY

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AND

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THE HON'BLE SRI JUSTICE SUDDALA CHALAPATHI RAO

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W.P. No. 21770 of 2O24

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O R D E R: /Per the Hon'bLe Sri Justice Sud.data Chalapathi Rao)

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The present Writ Petition is filed '"vith the following prayer:

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'1) issue a Wit, Order of Direction more particularty, in the na.ture of Wnt of Certiorari, settirlg aside the Orders of the Lower Authorities as lacking in

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jurisdiction, being against tlrc laut laid bg the Hon'ble Supreme Court irt PCIT u. Abhisar Buildutell;

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1. set aside the consequent orders and proceedings for^{recoueryof demand including the consequent} penalties leuied;

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1. and to pass such other order..."

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2.^'The brief facts of the case are that, the petitioner is a nonbanking linalcial company registered as a Core I vestment Company with the Reserve Bank of India under Registration No. N-09.00438. It hled its return of income for the^{assessrnentyear} 2016-17 on 17.1O.2016, admitting a loss of Rs.89,88,52,472/-, which was processed under Section 1a3(1) of the^Income Tax Act, 1961 (for short, "the Act"),^{accepting the returned loss.}

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Further, a sea-rch and^{seizure operationwas conducted on} 04.01.2018 in the^{Group of M/s NuziveeduSeeds Limited, which} also covered the^{petitioner's company.Pursuant thereto, a notice} under Section 153-A of^{the Act was issued on 22.01.2019 and in} response to it, the petitioner filed^{its return for the assessment} year 2016-17 on 16.02.2019, declaring the loss^of Rs.89,88,52,4721 -. Thereafter, the Assessing Officer^completed the assessment under Section 143(3) read with Section^153-4of the Act on 30.12.2019, making an addition of Rs.20,44,42,762/towards disallowance under Section 14,{ of the Act, and assessed the loss at Rs.40,97,70,767 l- by passing appropriate orders.

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Aggrieved thereof, the petitioner preferred an appeal belore the Commissioner of Income Tax (Appeals)-11, Hyderabad (for short 'CIT(A)') in Appeal No. 10362/2O19-20 for the assessment year 2016-77. The CIT(A), by order, dt.O8.12.2O21, affirmed the assessment order arrd assailing the same, the petitioner filed a further appeal before the Income Tax Appellate Tribunal, Hyderabad (for short 'ITAT') in ITA No.26lHyDl2O22. Further, for the subsequent assessm ent yeal, of 2012_19, for similar

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disallowance by the Assessing Authority, which was affirmed by the CIT(A), the petitioner filed an appeal in ITA No.27lHyD/2022.

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Both orders of the CIT(A) were challenged before the learned ITAT and the learned ITAT, after appreciating the evidence on record dismissed both the said appeals i.e., ITA.No.26lfNDl2022 and ITA.No.27 /HYDI 2022, by a common order, dt.26.09.2022, affirming the orders of the CIT(A).

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Now in the instant^q,rit petition, the writ petitioner assails the order passed by the learned ITAT in ITA.No.26IHYDl2O22, dt.26.O9.2O22, inter alla contending that the lower Appellate Authorities and the Assessing Authority have erroneously passed the orders without appreciating the factua,l issues in proper perspective and failed to consider the orders of the Hon'ble Apex Court in PCII a. Abhisar Buildutell Put. Ltd..l and prayed to set aside the order of learned ITAT in ITA.No.26lHYD /2022, dt.26.O9.2O22 and also the orders of both the CIT(A) and Assessing Authority.

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I (2023) SCC Online SC 481 = (202412 SCC 433

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7 . The respondents^{hled a counter affidavitcontendingthat} since an effective^{alternateremedy of appeal under Section260-A} of thc Act is available^{before this Court, fiiing of the Writ Petition} amounts to abuse of^{process of law and amisuse of writ} jurisdiction under Articl e 226 of the Constitution of India. It^is further stated that the^present Writ Petition^{is not maintainable,} as there is no arbitrariness, excess of^{jurisdiction,} or^{violation of} the principles of natural^justice, and that the plea of lack of jurisdiction and alleged violation of natural justice is merely an attempt to bypass the statutory appellate remedy by making a feeble attempt to indirectly achieve what they could not achieve directly. The respondents also point out that the judgment of the Honble Apex Court in PCffs case (supra) was delivered on 24.04.2023 i.e., subsequent to the ITAT's order, dt.26.O9.2O22, and hence cannot be applied retrospectively to the orders that had already attained finality, more so the orders of the learned ITAT are appealable under Section 260-A of the Act. Therefore, invoking the writ jurisdiction of this Court under Article 226 of tne Constitution of India re\zing on the decision of the Honble Apex Court in PCI?'s case(supra) after a lapse of nearly more than two

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yea'rs' is against to the judicial precedents, and hence the writ Petition is not maintainable ancl is liable to be dismissed.

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B. Heard Sri P.somasekhar Reddy, learned counsel for petitioner, Sri N.Bhujanga Rao, learned Deputy Solicitor General of India for respondent No.l, and Sri N.Praveen Reddy, learned Senior Standing Counsel appearing for respondent Nos.2 & 3.

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The learned counsel for the petitioner mainly contended that, in PCI?'s case (supra), the Hon'ble Apex Court has categorically held that in the absence of any incriminating material, the assessing authority lacks^jurisdiction under Sections 132 or 132A of the Act, and that in the cases of completed or unabated assessments, additions can^{be made only on the basis} of incriminating material found during^{the search. It was further} submitted that in such cases,^{the only recourse availableto the} Revenue is to initiate^{reassessment proceedings under sections} 147/l4SoftheAct,subjecttofulfillmentoftheconditions prescribed therein and that in^{the instant case of the writ} petitioner no incriminating^{materialwas found and in the absence} of the^{same, tlee auttrorities lack jurisdiction to resort to pass the}

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impugned Proceedings,^{and thus contendsthat the case of the} petitioner squarelY^{fallunderthe factual matrix of PCIfs} case(supra)^{and that entire proceedingsare vitiated by procedure} and lau,,^{as authoritiesactedbeyond their jurisdjction'}

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The learned^{counselfurther submitted that the assessing} authority^{as u'ell as the appellateauthorities failedto follow the} legal mandate^{and dismissedthe petitioner's appeals without} proper appreciation^{of the facts or application of the ratio laid} down by the^{Hon'lcleApex Court in PCfTscase(supra), thereby} causing grave injustice to^{the petitioner,and prayed this Court to} allow the writ petition by^{setting aside the impugned orders of the} assessing authority as well as the appellate^authorities.

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Per contra, Sri N. Praveen Reddy, learned Senior^Standing Counsel for the respondents, submitted that for both the assessment 1'ears i.e., 2016-L7 and 2Ol7-18, the very same contentions were raised by the assessee before the CIT(A) and before the learned ITAT, and the said contentions were rejected by orders dated 08.12.2021 and26.O9.2022 respectively. Further, as against the order in ITA No.26/HYD/2O22 for assessment year

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2016-17, the petitioner has filed the instant writ petition instead of availing the alternative statutory remedy of appeal under Section 260-A of the Act. In fact, for the subsequent assessment year 2OL7-18 as against the order passed by the learned ITAT in ITA.No.27/HYD / 2022, dt.26.09.2022, the writ petitioner availed the remedy of appeal under Section 260-A of the Act by filing ITTA No.39 of 2025 along with a petition for condonation of delay of BOO days, and thus, the instant writ petition filed, is nothing but a feeble attempt to gain ground indirectly, which they cannot achieve directly by surpassing the appeal provision under the Act.

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Learned Senior Standing Counsel further submitted that it is a settled principle of law that a writ petition is not maintainable wheh an effective and efficacious alternate remedy is available under the statute. Reliance was placed on the judgment of the Hon'ble Apex Court in Commissi oner o,f Income Tax & Others a. Chhabil Dcss Agarual2, wherein it was held that rvrit jurisdiction under Article 226 of the Constitution can be invoked only in exceptional circumstances, such as when the statutory remedy is illusory, when there is a violation of the principles of

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2 {2014} t SCC 603

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natural justice, or when the authority^{has acted without} jurisdiction.

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Learned Senior Standing Counsel^{further contended that} n one of the exceptions arise in the present iase and that^the remedy of appeal provided under Section 260-A of the Act is comprehensive to address all questions of law. Since the petitioner has already invoked the said remedy under Section 26O-A of the Act for the subsequent assessment year 2OL7-18, frling the present writ petition selectively for the earlier assessment year of 2016-17 amounts to br.-passing the statutory appellate procedure by adopting different modes of challenge to a common order passed by the learned ITAT. Hence, the writ petition is not maintainable and is liable to be dismissed

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14 . We have given earnest consideration to the submissions made on either side, and perused the record.

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The mairr contention of the learned counsel for the petitioner is that the assessing authority and the appellate authorities failed to consider and applv the principles laid down by the Hontle Apex Court in PCf?'s case (supra), and contends that the said

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amthorities erred in passing the impugned orders, and hence, the petitioner, by the present Writ Petition, challenges the common order dated 26.09.2022 passed by the learned ITAT insolar as ITA No.26/FfYD/2022 for the assessment year 2016-77. He further contends that, as both the appellate authorities arrd the assessing authority have contravened the procedure, and acted beyond their scope of^{jurisdiction,} as such the writ petition is maintainable.

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i6. On a perusal of the record, it is evident that the petitioner has filed an appeal before this Court against the common order ol the learned ITAT in ITA No.27/HYD/2022 for the assessment year 2Ol7-18, uide ITIA No.39 of 2025, along with a petition seeking condonation of delay of 8OO days. The said delay condonation petition was dismissed, and consequently, the appeal was rejected by this Court by order dated 30.1O.2025.

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L7 . The present writ petition was filed prior to the hling of the said appeal and the writ petitioner has not availed the efficacious and effective remedy of appeal under Section 260-A of the Act, and instead has filed the instant Writ Petition under Article 226 of^the Constitution of India, whrict. pima facte arnounts to surpassing

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the remedy under Section 260-A of the^{Act, which under normal} circumstances is not permissible

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The Honble Apex Court tn Chhabil Dass Agaruc Is case (supra), has clearly held that a rvrit petition under Article 226 of the Constitution of India is not maintainable, when an effective and efficacious alternate remedy is available under the statute. The Court has observed that u,rit^jurisdiction under Article 226 of the Constitution should be exercised only 1n exceptional circumstanc e s. namelg^-

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"a) Where remedy available under the statute is not effective but only a mere formality with no substantive relief;

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b) Where statutory authorities have not acted in accordance with the provisions of the enactment in question;

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c) Where the statutory authorities acted in defiance of the fundamental principles of judicial procedure;

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d) Where the statutory authority resorted to invoke the provisions which are repealed;

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e) Where the statutory authority passed orders in total violation of principles of natural justice."

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As seen from the lactual matrix of the case, the petitioner has an efficacious statutory remedy of appeal under Section 260-A

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of the Act, which enables this Court to examine substantial questions of law arising fronr the orders of the rearned ITAT amd to deal with the perversity of the orders passed by thc lorver appellate authorities, a,d this Court in exercise of jurisdiction und.er Article 226 of the Constitution of India, cannot function as a Court of Appeals against the decisron of a Tribuna.l/ITAT and re_appreciare the facts or legality of the orders of the Tribunal/I,IAT.

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Thus, the contention of Sri N.praveen Reddy, learned Senior Standing Counsel, that the powers urrder Sectio n 26O_Acannot be obliterated by filing a writ petition under Articre 226 of the Constitution of htdia, appears to be germane and well-founded.

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.ft is also relevant to note that the writ petitioner, instead of pursuing the statutory remedy in time, has chosen to invoke the extraordinary writ jurisdiction of this Court, to overcome the limitation and had the writ petitioner filed the appeal^{within the} stipulated time, the same would^{havebeen considered on merits,} as the remedy of^{appeal is comprehensiveto deal with ali relevant} questions of law. The^{conduct adopted by the writ petitioner for}

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conven^l ence to^{gain advantage,is not acceptable and deserves to} be deprecated

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In vie,"r' of the above findings,^{we are of the consideredview} that the present Writ Petition is devoid of^{any merits and not} maintainable, more particularly in view of the availability of a statutory appeal under Section 260-4 of the Act and more so it does not fa-ll within the exceptions carved out by the Hontrle Apex Court in Chhabtl Dass Agarucl's case (supra). Thus, the Writ Petition fails and is liable to be dismissed.

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Accordinglv, the present Writ petition is dismissed. No order as to costs

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'As a sequel thereto, miscellarreous petitions pending, if any,

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shall stand dismissed

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//TRUE COPY//

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S AH ED ABDULLA KHAN
ISTANT REGISTRAR
SECTION OFFICER

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To,

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One CC to SR l. P. SOMA SHEKAR REDDY, Advocate [OPUC] 2. One CC to SRI N. BHUJANGA RAO, Deputy Solicitor General of lndia [oPUCt 3. One CC to SRl. c. r wo CD Copies N PRAyEEN REDDY,SENIOR SC IOPUC] 8M BS Yv

HIGH^COURT

DATED:01^11212025

ORDER

WP.No.21770^{of 2024}

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I
..t HE SIA
il j,
ll oa-', 2 I JAN 2026
a
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n

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DISMISSING THE WRIT PETITION WITHOUT COSTS