Himachal Pradesh High Court
Charanjit Singh vs . Income Tax Officer & Others on 3 July, 2024
Author: Mamidanna Satya Ratna Sri Ramachandra Rao
Bench: Mamidanna Satya Ratna Sri Ramachandra Rao
Charanjit Singh vs. Income Tax Officer & others
.
CWP No.6202 of 2024
03.07.2024 Present: Mr. Praveen Sharma, Advocate, for the petitioner.
Mr. Neeraj Sharma & Mr. Ishaan Kashyap, Advocates,
for respondents no.1 to 3.
Mr. Balram Sharma, Deputy Solicitor General of India,
for respondent no.4.
CWP No.6202 of 2024 & CMP No.10461 of 2024
Notice to the respondents. Mr. Neeraj Sharma, Advocate,
accepts notice for respondents no. 1 to 3 and Mr. Balram Sharma,
Deputy Solicitor General of India, 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 1 st 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 29.03.2022, 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 as Hexaware
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 29 th 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 24.07.2024. Reply, if any, be filed in the
meanwhile
( M.S. Ramachandra Rao )
Chief Justice
July 03, 2024
r to ( Satyen Vaidya )
Judge
(vt)
