The Telangana High Court noted that notice issued u/s 148 of the Income Tax Act, 1961 without following the modified procedure under Finance Act 2021 is not valid and set aside the reassessment notice.
The applicant cited that the reassessment process in the furtherance of the Finance Act, 2021, stood altered but the respondents have ignored that, and thus notices issued u/s 148 of the Income Tax Act, 1961 cannot uphold judicial scrutiny. Since notices are poor in law, the resulting orders are also not good in law.
At the time of the hearing, counsel for the parties considered that curtains on this problem are drawn by this Court in a batch of writ petitions, W.P.No.25903 of 2022, and additional affiliated concerns, decided by a common order dated 14.09.2023. The same case may be disposed of as per the common order on 14.09.2023 has been agreed upon by the parties.
The court in the cited order ruled that the process to be adhered to via the respondent department on treating the issued notices for reassessment being u/s 148A, the following proceedings were mandatorily needed to be undertaken under the replaced provisions as stated under the Finance Act, 2021.
Without this we considered that the process opted via the respondent department violates the regulatory i.e. the Finance Act 2021 during the first instance. Secondly, it is indeed in direct breach of the directives issued via the Hon’ble Supreme Court in the matter of Ashish Agarwal, supra.
The Court learned that the impugned notices issued and the proceedings drawn via the respondent department are neither tenable nor sustainable, the issued notices u/s 148 post revision drawn via the Finance Act 2021 i.e on or post 01.04.2021 be deemed as notices u/s 148-A as per the revised provisions.
The court while quashing the notices issued u/s 147 and 148 of the act ruled that when the initiation of the proceedings itself was wrong in the procedure then the following orders indeed get nullified automatically.
The impugned Show Cause notices and consequential orders passed in writ petitions are set aside, the division bench of Justice Sujoy Paul and Justice Namavarapu Rajeshwar Rao stated.
For the petitioner(s), A.V.A.Siva Kartikeya appeared and for the respondent, Ms. B.Sapna Reddy, Sri J.V.Prasad, appeared.
| Case Title | Pottapinjara Paparao vs Office Of The Income Tax Officer |
| Citation | WRIT Petition NOS.14657, 14713, 14722, 14810 & 14872 OF 2024 |
| Date | 13.06.2024 |
| Appellant | Ms.B.Sapna Reddy |
| Respondent | Sri J.V.Prasad |
| Telangana High Court | Read Order |
