Himachal Pradesh High Court
Suresh Kumar Malpani vs . Income Tax Officer And Others. on 5 August, 2024
Author: Mamidanna Satya Ratna Sri Ramachandra Rao
Bench: Mamidanna Satya Ratna Sri Ramachandra Rao
Suresh Kumar Malpani vs. Income Tax Officer and others.
.
CWP No. 7789 of 2024
05.08.2024 Present: Mr. Nikhil Goyal, Mr. Rana Gurtej Singh,
Advocates (through Video Conferencing) and Mr.
Nitin Thakur, Advocate, for the petitioner.
Mr. Neeraj Sharma and Mr. Ishan Kashyap,
Advocates, for respondents no. 1 to 3.
Mr. Nand Lal Thakur, Senior Panel Counsel, for
respondent no.4.
CWP No. 7789 of 2024 & CMP No. 13199 of 2024
Notice to the respondents. Mr. Ishaan Kashyap,
Advocate, accepts notice for respondents no. 1 to 3 and Mr. Nand
Lal Thakur, Senior Panel counsel, accepts the same for respondent
no. 4.
2. Prima-facie, we are of the view that the impugned
notice, Annexure P-2 issued under Section 148 of the Income Tax
Act, 1961 by the 1st respondent, who is the Jurisdictional Officer,
is wholly without jurisdiction having regard to Section 151-A,
introduced in the Income Tax Act, 1961 w.e.f. 01.11.2020 and the
notification issued on 28.03.2022 thereunder, which specifically
contemplates that there would be automated allocation system in
accordance with risk management strategy formulated by the
CBDT and it is not the case of the revenue that the 1st respondent
is an officer who has been so randomly allocated as per the
Scheme.
3. Similar view has been taken by the Telangana High
.
Court in a judgment dt. 14.09.2023, rendered in CWP No. 25903
of 2023 and other connected matters, titled as Kankanala
Ravindra Reddy Vs. Income Tax Office and two others in paras
25 to 27 & 31, which read as under:
"25. A plain reading of the aforesaid two
notifications issued by the Central Board of
Direct Taxes dated 28.03.2022 and
r29.03.2022, it would clearly indicate that the
Central Board of Direct Taxes was very clear
in its mind when it framed the aforesaid two
schemes with respect to the proceedings to be
drawn under Section 148A, that is to have it in
a faceless manner. There were two mandatory
conditions which were required to be adhered
to by the Department, firstly, the allocation
being made through the automated allocation
system in accordance with the risk
management strategy formulated by the Board
under Section 148 of the Act. Secondly, the re-
assessing has to be done in a faceless manner
to the extent provided under Section 144B of
the Act.
26. After the introduction of the above two
schemes, it becomes mandatory for the
Revenue to conduct/initiate proceedings
pertaining to reassessment under Section 147,
148 & 148A of the Act in a faceless manner.
Proceedings under Section 147 and Section
148 of the Act would now have to be taken as
per the procedure legislated by the Parliament
.
in respect of reopening/re-assessment i.e.,
proceedings under Section 148A of the Act.
27. In the present case, both the
proceedings i.e., the impugned proceedings
under Section 148A of the Act, as well as the
consequential notices under Section 148 of the
Act were issued by the local jurisdictional
officer and not in the prescribed faceless
manner. The order under Section 148A(d) of
the Act and the notices under Section 148 of
the Act are issued on 29.04.2022, i.e., after the
"Faceless Jurisdiction of the Income Tax
Authorities Scheme, 2022."
and the "e-Assessment of Income
Escaping Assessment Scheme, 2022 were
introduced.
28 .........
29........
30.......
31. It is well settled principle of law that where
the power is given to do certain things in
certain way, the thing has to be done in that
way alone and no any other manner which is
otherwise not provided under the law."
4. The Bombay High Court in a judgment dt.
03.05.2024,rendered in Writ Petition No. 1778 of 2023, titled
asHexaware Technologies Ltd. Vs. Assistant Commissioner of
Income Tax & others,has also taken a similar view in paras 35 &
39, which read as under:
"35.........The Scheme dated 29th March 2022
.
in paragarph 3 clearly provides that the
issuance of notice "shall be through automated
allocation" which means that the same is
mandatory and is required to be followed by the
Department and does not give any discretion to
the Department to choose whether to follow it
or not. That automated allocation is defined in
paragraph 2(b) of the Scheme to mean an
algorithm for randomised allocation of cases by
using suitable technological tools including
artificial intelligence and machine learning
with a view to optimise the use of resources.
Therefore, it means that the case can be
allocated randomly to any officer who would
then have jurisdiction to issue the notice under
Section 148 of the Act. It is not the case of
respondent no. 1 that respondent no. 1 was the
random officer who had been allocated
jurisdiction.
36 to 38............
39. With reference to the decision of the
Hon'ble Calcutta High Court in Triton
Overseas Private Limited (Supra), the Hon'ble
Calcutta High Court has passed the order
without considering the Scheme dated 29th
March 2022 as the said Scheme is not referred
to in the order. Therefore, the said judgment
cannot be treated as a precedent or relied upon
to decide the jurisdiction of the Assessing
Officer to issue notice under Section 148 of the
Act. The Hon'ble Calcutta High Court has
referred to an Office Memorandum dated 20th
.
February 23023 being F No. 370153/7/2023
TPL which has been dealt with above.
Therefore, no reliance can be placed on the
said Office Memorandum to justify that the JAO
has jurisdiction to issue notice under Section
148 of the Act. Further the Hon'ble Telangana
High Court in the case of Kankanala Ravindra
Reddy vs. Income Tax Officer has held that in
view of the provisions of Section 151A of the
Act read with the Scheme dated 29th March,
2022 the notices issued by the JAOs are invalid
and bad in law. We are also of the same view."
5. Therefore, there shall be interim stay of all further
proceedings pursuant to Annexure P-2, notice issued to the
petitioner, till the next date of hearing.
6. List on 24.08.2024. Reply, if any, be filed in the
meanwhile.
(M.S. Ramachandra Rao)
Chief Justice.
(Satyen Vaidya)
Judge
5th August, 2024
(priti)
