M/s RAJA PUSHPA PROPERTIES PRIVATE LIM|TED v. 1. Assessment Unit

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 all further proceedings with respect to the assessment order dated 2910912022 passed by Respondent No. 2 for the assessmenl yeat 2O2O-21 . I.ANO:I OF 2023 Between

1. UNION OF lNDIA, represented by its Secretary, Department of Revenue, Ministry of Finance, North Block, New Delhi- 1 '10001 .

2. Additional/JoinUDeputy/Assistant Commissioner of lnc: ne Tax, National Faceless Assessment Centre, Delhi. ....PETITIONERS AND Optival Health Solutions Private Limited, 1 1-6-56, Sy.No.257 nd 25811, Opp ; IDPL Railway Siding Road, Moosapet, Kukatpally, Hyderabad -5Ct 137, Telangana, lndia represented by its Director- Gangadi Madhukar Reddy,S/o ( angadi Veera Reddy, aged about ssyears, Rl/o. Hyderabad. RESPONDENT Petition Under Section 151 CPC praying that in the ci :umstances stated in the affidavit filed in support of the petition, the High Cotrr may be pleased to vacate the orders dated.2011012022 in W.P.No.38716 of 2(22, in the interest of justice. Counsel for the Petitioner : SRI R.S.ASSOCIATES Counsel for the Respondent No.1 : SMT B.KAVITHA YADII I (CENTRAL GOVT COUNSEL) Counsel for the Respondent No.2 : SRI J.V.PRASAD & Ms (.MAMATA W.P.NO: 39666 OF 2022 Between: Dhanlaxmi lron lndustries Private Limited, having its Registere c Office at 15-9-358/9, Mukhtyargunj, Hyderabad - 500012, Telangana and Repres(,r ted by its authorized signatory Mr. Rajesh Gupta .....PETITIONER AND 1 Union of lndia, represented by its Secretary, Departmert :f Revenue, Ministry of Finance, North Block, New Delhi -1 10001 .

2. Assistant Commissioner of lncome Tax, National E-Ass,: sment Center, Room No. 4O1,2nd Floor, Jawaharlal Nehru Stadium, De hi- 110003.

3. The Assessment Unit, lncome Tax Department, National :aceless Assessment Centre, Room No. 401 , 2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi - 110003. ....RESPONDENTS Petition Under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a Writ, Order or Direction more particularly in the nature of a Writ of Mandamus declaring the lmpugned Assessment Order dated 29.09.2022 for AY 2020-21 in PAN. AABCD0679C bearing Order No. |TBA/AST/S/143(3112022- 2311046122156('1 ) as being void, illegal arbitrary, violative of Articte 14 of the Constitution of lndia and violative of Principles of Natural Justice_ |.A.NO:1 OF 2022 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 pending disposal of the writ petition, this Hon'ble Court may be pleased to stay the operation of the penalty notice dated 29-09-2022 bearing DlN. rTBA/PNL/S/270 N2022- 23t 1 0461 22367 (1 ) |.A.NO:2 OF 2022 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 pending disposal of the writ petition, this Hon'ble Courl may be pteased to may be pleased to stay all further proceedings and consequential actions including collection of tax pursuant to the lmpugned Assessment Order dated 29.09.2022 for AY 2O2O-21 in PAN. AABCD0679C bearing Order No I TBA/AST/S/1 43(3)t 2022-23 I 1 0 461 221 56(1 ). |.A.NO: 1 OF 2023 1 U11gn of lnd.ia, rep_Jesented by its Secretary, Department of Revenue, Ministry of Finance, North Block, New Delhi -1 10001 .

2. Assistant Commissioner of lncome Tax, National E-Assessment Center, Room No.401,2nd Floor, Jawaharlal Nehru Stadium, Delhi- 110003.

3. The Asiessment Unit, lncome Tax Department, National Faceless Assessment Centre, Room No. 401, 2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi - 110003. .....PETITIONERS AND Dhanlaxmi lron lndustries Private Limited, having its Register€( Office at 15-9-358/9, Mukhtyargunj, Hyderabad - 500012, Telangana and Represer ted by its authorized signatory Mr. Rajesh Gupta .....RESPONDENT Petition Under Section 151 CPC praying that ir the circumstances stated in the affidavit filed in support of the petition, the Jigh Court may be pleased to vacate the orders daled 2811O12022 in W.P.No.:] t666 of 2022, in the interest of justice. Counsel for the Petitioner : SRI V.ANEESH Counsel forthe Respondent No.1 : SMT B.KAVITHA YADAv (CENTRAL GOVT couNSEL) Counsel for the Respondent Nos.2 & 3 : SRI J.V.PRASAD €, Vls K.MAMATA W.P.NO:1219 OF 2023 Between: K. Yadagiri, S/o. Late. K. Gowraiah, Aged about 63 Years, Occ. Retired Government Employee, R/o. Flat No. 109, Himasai Gardens, Gulmohar Apartments, beside Naturals Saloon, Jawahar Nagar, Street No. 5, Hyderabad -50t ( 20. .....PETITIONER AND

1. MINISTRY OF FINANCE, National Faceless Assessment lenter Represented by lts Principal Chief Commission of lncome Tax Department Room No 356 C.R. BUILDING, lP Estate, New Delhi, De t i I10002.

2. Deputy Commissioner of lncome TAX Regional Faceles: \ssessment Center, lncome Tax Department, Central circle-1(4) Ayakar Bhavz r, Opposite to L.B.Stadium, Basheer bagh, Hyderabad.

3. Assessment Officer, Regional Faceless Assessment Cer t ;r, lncome Tax Department, Central circle-'l(4) Ayakar Bhavan, Opposik. o L.B.Stadium, Basheer bagh, Hyderabad. ..RESPONDENTS Petition Under Arlicle 226 of the Constitution of lndiz traying that in the circumstances stated in the affidavit filed therewith, the l1 gh Court may be pleased to issue an appropriate writ, order or dire particularly one in the nature of WRIT OF MANDAMUS declaring the ac respondents null and void and contrary to the provision of the lncome Tax Act for not following the due procedure of law prescribed under the lncome Tax Act 1961 under section 144 B and consequently quash, or set aside the final assessment order dated 28.12.2022 and demand notice issued under section 156 of lncome Tax and show cause notices issued under section 274 RM 270 A, Notice UIS 274 R/w Section 271AAC(1) of lncome Tax Act. l.A.NO:1 OF 2023 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 of all further proceedings for appeal and subsequently stay the proceedings for the demand notice issued under section 156 for penalty proceedings lssued under sections 274 RM 270 A, Notice UIS 274 RJw Section 271AAC (1) of lncome Tax Act 1961, pending disposal of the main writ petition. Counsel for the Petitioner : SRI MANDALA NAGENDRA BABU Counsel for the Respondents : SRI J.V.PRASAD (SC FOR INCOME TAX) The Court made the following COMMON ORDER THE HO N'BLE SRI JUSTICE P.SAM K(] SHY AND THE H ON'BLE SRI ]USTICE NARSING RAO N' N IKONDA WRIT PETITION No.397O6 of 20iI: WRIT P TITION No 3 a7l6 of 2O2 WRIT PETITI ON No.39666 of 2O2: AND WRIT PETITION No.1219 of 2O2:l OMMON ORDE (per the Hon'ble Sfi lustice P.Sam Koshy) Heard Mr. S.Ravi, learned Senior Counsel re ; resenting M/s. R.S. Associates for the petitioner in Writ petition No 8716 of 2022; appearing for Mr. V,Aneesh, learned counsel for tl-: petitioner in Writ Petition No.39666 of 2022, and also appearin,l for Mr. Dundu Manmohan along Mr. Dundu Sashank, learned (,( unsel for the petitioner in Writ Petition No.39706 of 2022, Mr. Mar Jala Nagendra Babu, learned counsel for the petitioner in Writ petit cn No.1219 of 2023; and Mr. l.V. Prasad & Ms. K.Mamata, learned i:nior Standing Counsels for the .lncome the respondents / Revenue. Tax Department appearirrr on behalf of

2. Since the issue involved in these batch of Writ t etitions is one and same, they have been taken up and heard tol:ther and are decided by this Common Order' Howeveri we first intend to refer to the facts in Writ Petition No'39706 of 2022'

3. The instant writ petition is filed by the petitioner under Article 226 of the Constitution of India challenging the order dated 29.Og.2022 passed by the respondent No'1 under Section 143(3) read with Sectlon l44B of the Income Tax Act' 1961 (briefly 'the Act' hereinafter) for the assessment year 2O2O-21 vide Document IdenrificationNo.(DIN)ITBA/A Sr ls/ t43(3) / 2022-23 I to46122 105( 1) (for short the 'imPUgned order')' 4. The brief facts of the case are that Petitioner M/s Raja retu rn of income for the Pushpa Properties Pvt' Ltd' filed its Assessment Year 2O2O-2:- on 10'12'2020 declaring a total taxable lncome of Rs.31,87,2 6,7401- which was selected for scrutiny under CASSandnotlcesunderSectiont43(2)oftheActwereissuedand further the respondent No'1 issued detailed notice under Section 142(1,) of the Act to furnish all the details regarding the unexplainedincome.DuringtheaSsessmentproceedings,the Assessing Officer raised queries regarding 'other long term liabilities'amounting to Rs'246 crores shown in the balance sheet as on 31.03.2020. The petitioner clarified on mu tiple occasions through detailed replies dated t5.O3.2022, 2,.O8.2022 and

20.09.2022 stating that these liabilities pertairr: to advances received from customers for purchase of land parc{) s ranging From 1 to 4 acres each, and explicitly stated that tl ese were not advances for flat or villa bookings as was br: ng incorrecUy presumed by the Assessing Officer. The petitioner p -ovided details like permanent account numbers (pAN), complete rddress, direct contact telephone numbers, written confirmation le:ters from the advance-paying partres, details of the naturi_' of property transactions, extent of land agreed to be purchz sed, dates of receipt of advances, and complete ledger accounts ti r 11 identified parties involving aggregate advances of Rs.134 crcr ts, specifically and expressly requesting the Assessing Officer t ) contact the parties directly on the telephone numbers provir ed if further verification oT clarification was needed, demc lstrating full transparency and willingness to cooperate.

5. Despite the detailed submissions and < cmprehensive documentary evidence furnished, the respondent I lo.1 issued a show cause notice dated 20.09.2022 under Sec on I448(1)(xii) of Page 4 of 2E the Act proposing substantial additions on the fundamentally erroneous and factually incorrect premise that the advances were received from flat / villa purchasers who were companies. This premise was wrong on two counts: firstly, the advances pertained to land purchases and not flats / villas, and secondly, out of the 11 parties who had given advances, five were individuals and only six were corporate entities, not all companies as assumed. 6, The petitioner promptly objected to this material mischaracterization through a detailed letter dated 23.O9.2022 once again reiterating with supporting documentary evidence that the advances were exclusively for land transactions and not for any residential units. The petitioner further provided confirmation letters which clearly stated that Rs.22 crores out of the total Rs.134 crores under scrutiny were opening balances which were carried forward from previous assessment years and, therefore, did not represent fresh receipts during the current previous year 2019- 20 under consideration. The petitioner particularly emphaslzed that one significant transaction with EKGE Retail LLP amounting to substantial sums was initially structured as a mortgage arrangement with stipulated interest. and that interest amount of Rs.27,00,000/- had been duly credited to the par."s account and claimed as business expenditure in the profit arrr loss account, which was accepted by the Assessing Offict:r without any disallowance. The petitioner argued that this ac::ptance of the interest component made it logically and legally incc nsistent for the Assessing Officer to simultaneously doubt and re]::t the principal advance component of the same transaction. Most s gnificantly, the entire assessment proceedings were completed w t rin merely five days of issuance of the show cause notice, cle.r ly indicating a rushed, mechanical, and perfunctory process \, ithout proper, detailed, and judicious consideration of tf 3 petitioner's comprehensive responses and voluminoLt: supporting documentation and the respondent No.1 accordirr lly passed the impugned order, Additionally and surprisingly, t le assessment order included a separate disallowance of Rs.30, 6,520/- under Section 40A(3) of the Act relating to cash paynr )nts exceeding prescribed limits which disallowance was n€ \ er quantified, specified, or even remotely mentioned or alluded .o in the show cause notice dated 20.09.2022 issued under Secti, n 1448 of the Act, thereby completely violating the mandat rry procedure prescribed under Section 1448 of the Act which requires all proposed additions and disallowances to be specifically intimated to the assessee before passing the final assessment order.

7. Learned Senior Counsel for the petitioner primarily contended that the impugned assessment order dated 29.O9.2022 passed by the respondent No.1 is fundamentally incorrect and materially erroneous by treating the advances of Rs.134 crores received from 11 identified parties as advances for flat / villa bookings from companies, when in reality these advances pertained exclusively to purchase of land parcels ranging from I to 4 acres each, and out of the 11 parties, five were individuals and only six were corporate entities. Despite the petitioner's repeated clarification through multiple detailed submissions dated 15.03.2022, 23.O9.2022, and other co rrespo nd e nces. and furnishing comprehensive documentary evidence including complete details of the parties (PAN, addresses, direct contact telephone numbers), wfitten confirmation letters from the advance-paying parties acknowledging the transactions, details of the nature and extent of land agreed to be purchased, dates of receipt of advances, and complete ledger accounts demonstrating the transaction trail, the Assessing Officer . iasFieM?.a_! / -,/ mechanically and arbitrarily rejected the explanatio I without any valid basis, rationa I reasoning, or proper application ) mind. 8 Learned Senior Counsel further contended th.t Rs.22 crores out of the total Rs.134 crores under scrutiny Uere opening balances carried forward from earlier assessme L years and therefore did not represent fresh receipts durin(l the current previous year 2019-20 under consideration, yet Officer erroneously treated even these openrng ba lances as unexplained cash credits chargeable to tax under secton 68 of the Act in the current assessment yeari which shows a co1 plete lack of understanding of basic accounting principles ar d temporal applicability of tax provisions. re Assessrng

9. Learned Senior Counsel further submitted that or 20.0g.2022 at 06;00 P.M. the respondent No.1 issued a show rause notice under Section laaB(1)(xii) of the Act stating that cerr. in advances disclosed under other long-term liabilities were sign lcanUy high and exceeded the varue of frats / vi[as. He further crari ied that the advances in question pertained to purchase of rand on, and not to the value of flats / villas. Furthermore, out of 11 p rrties from individuals and not in the show cause whom advances were received' 5 were companies, contrary to the assertion made the Petitioner also notice. In response to the queries raised' furnished complete details of the parties confirming payment of advances' However, if the Assessing Officer had any doubt regarding the genuineness of these transactions, notices under Section 133(6) of the Act could have been issued to the concerned parties whose complete details including PAN' addresses' and contactnUmberswerealreadyprovided.Thus,meremechanical rejection without calllng for any further particulars or conducting any independent verification demonstrates non-application of mind and also amounts to a violation of principles of natural justice' 10. Moreover, the learned Senior Counsel submitted that petitioner's repeated request to the Assessing officer to contact the 11 parties directly on the telephone numbers provided to verify the identitY, genuineness, and cred itworthiness of the transactlons, therebY demonstrates full transParencY, comPlete willingness to cooperate and Yet the whatsoever to contact indePendent enqu rrY. instead chose to mechanically and arbitrarlly Assessing Officer made even a single PartY or conduct anY no attemPt t{;*t".*71 /1 - reject the documentation furnished by the petitlor( r without any rational basis or valid reason.

11. Furthermore, the learned Senior Counsel also t ontended that the show cause notice dated 20.09.2022 was vagl: and did not quantify the proposed additions or disallowance; made under Section 40A(3) of the Act. For instance, in the show :ause notice it was stated in general terms that 'significant arT ount of cash payments were made in excess of Rs.10,000/-' but ,l d not quantify the specific amount proposed to be disallowed. It 'r rs only in the Final Assessment Order that total disallowance of I s.3o,26,52O/- was mentioned for the first time. Thus, thil; approach is fundamentally flawed and violates the principles of ratural justice as the petitioner was not given any opportunity to er rlain or justify the specific cash payments that were proposed to b€ lisallowed. L2. Lastly, the learned Senior Counsel also subrr itted that the delay in filing initial responses was on account of he COVID-19 pandemic period (15.03.2O2O to 28.O2.2O22 as per Supreme Court's suo-moto order) when there was lack of ac ( quate staff to collate voluminous information, and moreovet th€ initial notice itself was vague and did not specify exact requirements. Howeve4 from the second notice onwards, the petitioner had been prompt in filing detailed responses with supporting evidence, and the Assessing OFficer cannot now take advantage of his own wrong in not following the due procedure prescribed under Section l44B of the Act. Thus, praying this Court to set-aside the impugned order passed by respondent No. 1 and also allow the present writ petition.

13. Per contra, learned Senior Standing Counsel for the Revenue contended that the assessment proceedings were conducted in accordance with the provisions of law and adequate opportunities were provided to the petitioner throughout the assessment process. It was submitted that the petitioner was issued notices under Section 143(2) of the Act on 29.06.2021, followed by detailed questionnaires on 27.O2.2022, 09.O3.2022, and

22.08.2022 calling for specific information and documents, and that the Assessment Order was passed only after careful examination of the material on record and the submissions made by the petitioner from time to time. l L4. Learned Senior Standing Counsel further cort:nded that the show cause notice dated 20.O9.2022 clearly set or - the proposed additions and the reasons therefor, specifically trrlhlighting that certain advances disclosed in other long-term iabilities were significantly high and exceeded the value of flats I rillas that such parties were not retail buyers but companies, anc :hat significant cash payments were made in excess of Rs'10,000./ in violation of Section 40A(3) of the Act, and the petitioner was ;iven sufficient time and opportunity to respond to these specit : concerns, to which the petitioner did file a response dated

23.O9. )-O22. However, the learned Senior Standing Counsel argues that the petitroner merely furnished a list of parties with their PA\ numbers and addresses, along with some confirmation letter:; but failed to provide credible evidence to establish the source cf funds with the parties, their capacity to advance such large anl )unts, and the commercial rationale for making such huge advanc:; for properties which were either not in existence or were of mtl:h lower value. Therefore, the Assessing Officer rightly treated t rese unverified advances as unexplained credits under Section 6ti of the Act and made add itions accord ing lY.

15. With regard to the disallowance under Section a0A(3) of the Act, the Senior Standing Counsel contended that the disallowance of Rs.30,26,520l- is justified as the petitioner made cash payments exceeding Rs.10,000/- per day per party during Ay ZO2O_21, violating Section 404(3) of the Act which mandates such payments be made through banking channels to curb unaccounted money, and while the show cause notice dated 20.09.2022 mentioned these excess cash payments and called For explanation. However, the petitioner failed to justify them or demonstrate any exception under Rule 6DD, and therefore the Assessing Officer was justified in disallowing the expenditure, and the petitioner cannot craim rack of notice merely because the exact amount was quantified only in the final Assessment Order. The learned Senior Standing Counsel thus submits that there was no violation of principles of natural justice and the petitioner cannot claim denial of opportunity of being heard.

16. Learned Senior Standing Counsel contended that there was substantial and unexplained delay on the part of the petitioner in filing responses to the notices issued under Section 143(2) of the Act. The initial notice under Section A3(2) of the Act was issued l.l ,/ ,, -'t - on L4.O7.2021, but the petitioner filed its first dert ailed response only on 79.02.2022 i,e. after a delay of more tt an 7 months. Learned Senior Standing Counsel submitted that s rch inordinate delay hampered the assessment proceedings and ir licates lack of seriousness and cooperation on the part of the t 3titioner. That despite the delay, the department accommodated t I ) petitioner by issuing further notices and questionnaires on a1 .O3.2022 and

22.O4.2022, calling for speciFic details and clarificati,r rs. L7, Learned Senior Standing Counsel lastly cont: rded that the petitioner's excuse of COVID-19 pandemic and la: : of adequate staff is not acceptable, particularly when the r ttitioner is a corporate entity engaged in real estate business r,u th substantial transactions and is expected to maintain proper records and documentation. However, the Senior Sta.nding Cour sel submitted that the petitioner cannot take advantage of its c|n wrong and delay in complying with statutory notices and ttr, rn claim that adequate opportunity was not provided. It was also : ubmitted that the assessment proceedings had to be complet€ I within the statutory time limit prescribed under the Act, and the delay caused by the petitioner left very little time for detailed L ack-and-forth Page L4 of 28 correspondence, which the petitioner is now trying to project as denial of opportu n ity. 1a. Having heard the contentions put forth on either side and on perusal of records, what is culled out is the fact that in the present writ petition the petitioner has challenged the assessment order dated 29.09.2022, passed under Section 143(3) of the Act, for the assessment year 2O2O-21.

19. The grounds of challenge to the said assessment order are:- 1) That the assessment order has been passed without following the principles of natural justice inasmuch as the Department has not granted a fair and reasonable opportunity to defend their case and also in producing relevant records before the authorities before passing the assessment order. 2) That the entire initiation of proceedings under Section 143(3) is in direct contravention to the manner and procedure prescribed under Section 7448, a provision of law which stood amended w.e.f. 0t.O4.2021 onwards, whereby the entire assessment proceedings was mandatorily to be drawn in a faceless manner. Whereas, in the instant case, the entire ----: # '1\!r-:r-\-t*7. - proceedings have been drawn by the Jurisdi: ional Assessing Officer

20. In the instant case, for the assessment year 1020-21, return of income was filed on 10.10.2020 declaring a t.: able income of Rs.31,87,26,740l-. The said return was selected f() scrutiny and a notice under Section 743(2) of the Act was issued t ) the petitioner. Thereafter, a notice under Section 142(l) r' as issued on

27.O2.2O22 calling upon the petitioner to furnisl- details of the documents in respect of the receipt of cash. The petitioner submitted his detailed reply along with all r tlevant cogent annexures available on 15.03.2022. Based upon tf( reply that was furnished by the petitioner, the respondent No . accepted the supporting evidence with regard to other long-ternt liabilities so far as an amount of Rs.7 crores is concerned. Howev<: as regards an amount of Rs.134,11,84,938/- was doubted. Aga t the petitioner was issued with a notice under Section t42(1) on >- )-.OB.2022 from the respondent No.1 calling upon the petitic,t er to furnish additional details including advances received from :ustomers such as PAN, address of the parties, contact details, c() lfirmation, etc. The petitioner gave three responses; one () ) 10.O9.2022,

14.09.2022, and 15.09.2022, and thereafter the authorities again issued a show-cause notice on 20.09.2022 to which also the petitioner gave his reply on 23.O9.2022 and thereafter the impugned assessment order has been passed on 29.09 .2022. 2L, Upon perusal of the responses submitted by the petitioner, ceftain facts which are apparently evident is that the petitioner has not been able to produce complete details including PAN, address of the parties, etc. in spite of repeat notices being issued by the Department and based upon which necessary verification could had been conducted. Further, the petitioner also was not able to explain credit worthiness of the advances so made particularly in respect of an amount of R.s.134,11,84,938/-. 22- Apart from the aforesaid facts, the admission on the paft of the petitioner himself of having received repeated show-cause notices by the Department from time to time, goes to establish that the contention of the petitioner being denied fair opportunity oF defence would not be sustainable as the Department in fact had given ample opportunity to the petitioner to appear and defend its case by leading cogent and substantial materials to substantiate the contents of the show-cause notice. Thus, thi.; Bench is of the firm view tha: the contention of the petitioner c. the impugned assessment order being in violation of the prrn< ples of natural justice is not sustainable and the same stands der: led in favour of the Revenue and against the petitioner. 23, Now comes the second question of the as;essment order being in violation of the provisions of Section l44B f the Act

24. The provisions of the Income Tax Act stooc amended w.e.f.

07.04.2021, by virtue of the Finance Act, 2021. Mr :h the insertion of Section 7448, all the assessments, rea:;: essments and recomputations which are proposed to be carried cr t u nder Section 144(3) has to be done in a faceless manner. The i sue of faceless assessment becoming mandatory for proceedir.c s drawn after O1.O4.2027 already stands adjudicated upon I r a series of litigations before this High Court in the case cf Kankanala Ravindra Reddy and Others vs. The Income l'i x Officer and Others ( batch of writ petitions, lead case being / .P.No.25903 of 2O22 decided on 74.09.2023). In the said judgm() t, the Division Bench of this High Court held at paragraph Nos.27 lr 36 as u nder: "27. In the present caser 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 lurisdiction of the Income Tax Authorities Scheme, 2022" and the "e-Assessment of Income Escaping Assessment Scheme, 2022" were introduced.

28. From the afore given factual matrix, firstly the statutory provisions enumerated in the preceding paragraphs and secondly, the subsequent direction given by the Hon'ble Supreme Court in the case of Ashish Agarwal, supra, what is clearly reflected is the fact that when the Hon'ble Supreme Court had partly allowed the petitions which were filed by the Union of India challenging the judgements of various High Courts whereby the notice under Section 148 of the unamended Act were set aside by the High Courts, the Hon'ble Supreme Court has only permitted the Union of India to proceed further with the reassessment proceedings under the amended provision of law, more particularly, as amended by the Finance Act, 2021. It never intended the authorities concerned to continue with the proceedings from the stage of the issuance of notices under Section 148, nor is the directions to that effect. And there cannot be any confusion, ambiguity or mis-conception for the respondent- Department to have in this regard. \nnr*'** -

29. The Hon'ble Supreme Court has in parag specifically held that the High Courts have riglttl'. the benefit of new provisions shall be made. respect of the proceedings relating to past . years. Further, the Hon'ble Supreme Cour paragraph No.8 very emphatically had saict proceedings ought not to have been issued unamended Act. Rather ought to had been issuet substituted provisions as per the Finance Act, 20) in the same paragraph clearly directed the lr Department to proceed further as per the Finana: subject fo compliance of all the procedural requir= defences available fo the assessee under the: provisions under the Finance Act, 2O21. The fer Hon'ble Supreme Court allowed the notice ea, under Section 148 be treated as notice one unl 148A and further it was also be treated as the ) notice issued under Section 148A(b) by itself esta, fact the directions given by the Hon'ble Supreme the respondent-Depa rtment was to proceed accordance with the substituted provisions wl introduced by the Finance Act, 2021. 'aph No.7 held that railable in ssessment again in that the tnder the under the '. Further, :ome Tax \ct, 2021, nents and ubstituted : that the er issued )r Section tow cause 'lishes the Court for u rther in ich stood

30. In the instant case, undisputedly the re;pondent- Department has not proceeded against the petit,cter under the substituted provisions of the Finance Act, 20) l. Rather, it proceeded with the unamended provisions of ta,(. This in other words takes the position back to the stage , s it stood when the initial notices under Section 148 L nder the unam.ended provisions of law were iqued. fh: in other l words also takes us to a position or a stage prior to the large number of writ petitions being allowed across the countryl approximately 9,000 in number and confirmed by the Hon'ble Supreme Court also vide the judgement of Ashish Agarwal, supra.

37. It is well settled principle of taw 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,

32. The Hon'ble Supreme Court in the case of Chandra Kishore lha Vs. Mahaveer and othersl in paragraph No.17 laying down the aforesaid principte held as under',it is welt settled solitary principle that if statute provides for a thing to be done in a particular manner, then it has to be done in that manner and in no other manner. The said principte of law vtas further reiterated in the case of Cherrukurimani Vs. Chief Secretary Government of Andhra pradesh and other], wherein, again in paragraph No.14, the aforesaid principte has been reinforced by the Hon,ble Supreme Court hotding that "where law prescribe a thing to be done in a particular manner following a particular procedure, it shall have to be done in the same manner fottowing the provisions of law without deviating from the prescribed procedure. The said principle has again recently been reiterated and followed in the case of Municipal Corporation Greater Mumbai Vs. 1999 8 SCC 266 2015 13 SCC 722 2 ' 1,r..1:1t-ltp7,

1. - Abhilash Lal and otherd, and in the case ot India Limited Vs. Axis Bank and others4 and, case of Union of India Vs. Mahesh Sings. In the Chemicals Limited Vs. Commissioner o) (preventive) Jam Nagef, wherein it has been hct can be no stopple against the law. If the l. something to be done in a particutar manner, t be done in that manner, if it is not done in that r it would have no existence in the eye of law. . t 18 of the satd judgment, the Hon,ble Supreme (.:, under: )pto Circuit gain in the ase of Tata Customs I that there w requires En it must 'anner then paragraph 'urt held as e basis amples ecause liately. Jntrary "The Tribunal's judgment has proceeded on tt that even though the samples were drawn r to law, the appellants woutd be estopped , their representative was present when the: were drawn and they did not object imme This is a completely perverse finding both on I law. On fact, it has been more than ampl1, that no representative of the appellant was, present at the time the Customs Inspector i samples. Shri K.M. lani who was allegedly not only stated that he did not represent the ( learing Agent of the appellants in that he was r r t their employee but also stated that he was not t resent when the samples were taken. In fact, tt ( .efore, there was no representative of the appeltana. oroved n fact, ok the tresent )ct and ' 2o2o 13 scc 234 o zoz't 6 scc zoz t cAPNo.aBoT of 2ozz u zots t't scc 62g ,/ the samples were taken. In law equally the Tribunal ought to have realized that there can be no estoppel against law. If the law requires that something be done in a particular mannerl it must be done in that manneL and if not done in that manner has no existence in the eye of law at all. The Customs Authorities are not absolved from following the law depending upon the acts of a particular assessee. Something that is illegal cannot convert itself into something legal by the act of a third person."

33. If we look into the principle of law laid down by the Hon'ble Supreme Court as enumerated in the preceding paragraphs and when we look into the facts of the present case, it would clearly reflect that the Parliament had by virtue of the Finance Act 2021, brought certain amendments to the provisions of the Income Tax Act, more particularly, in respect of the manner in whicli the reassessment and the procedure to be adopted by the Income Tax Department. The amendment was brought with an intention to make the law more transparent and effective. The Hon'ble Supreme Court also while deciding the case of Ashish Agarwal, supra, as is discussed with in the preceding paragraph had specifically directed the Union of India to proceed further in terms of the substituted provisions brought in by way of Finance Act 2021.

34. What is also relevant to take note of the fact that the Honble Supreme Court while exercising its power under Article 142 of the Constitution of India has also not relaxed \.- ,r"..*7 , - the applicability of the Finance Act 2021. Rather Supreme Court in very clear and unambiguo t held that the notices issued under the provisions, which were struck down by the Higr, be treated as a notice under new amended pr the Union of India was directed to proceed furtt stage in terms of the amended provisions of lav such specific clear directions by the Hon,ble St s. the Union of India for reasons best known agtr with the procedure as it stood prior b t provisions which came into force from O1.04.20) the Hon'ble ; terms had t n -amended Court, shall )visions and :r from that . In spite of 'eme Court, t proceeded =, amended 35, In view of the aforesaid discussions, it ts L clear that the procedure to be followed by the Department upon treating the notices reassessment being under Section 14gA, the proceedings was mandatorily required to be under the substituted provisions as taid dow, Finance Act, 2021. In the absence of wh t constrained to hold that the procedure ado,t respondent-Department is in contraventjon to i.e. the Finance Act, 2021, at the first instance. is also in direct contravention to the directives r; Hon'ble Supreme Court in the case of Ashish Agat y now very 'espondent- ssued for subsequent undertaken under the \, we are ed by the :he statute )econdly, it ued by the rual, supra.

36. For all the aforesaid reasons, the imput,t ed notices issued and the proceedings drawn by the r=spondent- Department is neither tenable, nor sustainable. -he notices so issued and the procedure adopted being pa, se illegat, deserves to be and are accordingly set aside/qt,, shed. As a '\--. a I\J consequence, atl the impugned orders getting quashed, the consequential orders passed by the respondent-Department pursuant to the notices issued under Section 147 and 148 would also get quashed and it is ordered accordingly' The reason we are quashing the consequential order is on the principles that when the initiation of the proceedings itself was proceduralty wrong, the subsequent orders also gets n u I I ified au tomatical lY. "

25. In the instant case also, the Department has not been able to show one good reason as to why the amended provisions as per the Finance Act, 2021 insofar the proceedings to be initiated in a faceless manner could not be done. In the counter also the Department has been silent so far as the faceless assessment part is concerned. The judgment in the case of Kankanala Ravindra Reddy and Others (supra) also squarely applies to the facts of this case and the impugned assessment order deserves to be and is accordingly set aside / quashed. The second ground thus stands decided in favour of the assessee and against the Revenue' The impugned order therefore ls not sustainable and the same deserves to be and accordingly set aside / quashed and the consequential orders also would thereby be not sustainable and the same also are ^ set aside / quashed. The Writ Petition No . 9706 of ZOZ2 accordingly stands allowed

26. Coming to Writ Petition No.1219 of 2O2l here also the factual details narrated by the petitioner in the w-: petition seems to be two fold as in the earlier case t.e Writ Pet t on No.38706 of

2022. Here also the impugned order has been rssailed on two grounds; one is the ground of violation of the prir:iples of natural justice and the other is the impugned order beinrl violative and in contravention to the provisions and procedure p -escribed under Section 7448 of the Act. 27, In the impugned order in paragraph No.2 tt e details of the opportunity and hearing being given to the p€t tioner is being reflected in tabular form. Surprisingly, the 4th colu nn of the table would show that the petitioner has not effectivo y responded to each of the notices issued. Then comes the questrc I as to whether the notices were in fact served upon the petitionet or not. A plain reading of the affidavit filed by the petitioner in par rgraph Nos.2 to 6 gives a clear indication of the petitioner admit ing the fact of receiving the notices which were issued time and :;ain, and which the petitioner on receipt of the same, have also confided with his auditors and other consultants. In view of the same, as has been held in Writ Petition No.38706 of 2022, the question of violation of principal of natural justice in this case also stands decided against the petitioner and in favour of the Revenue. 2A. As regards the second question of the impugned order beinq in violation of the provisions of Section l44B of the Act, there is no dispute of the fact that the impugned order of assessment having been passed by the lurisdictional Assessing Officer of the concerned unit in the Income Tax Department and whether the order issued by the Jurisdictional Assessing Officer is in violation of Section l44B or not has been extensively dealt with while deciding the second issue in Writ Petition No.38706 of 2022. In view of the same, applying the same principles, the second issue raised by the petitioner in this case also stands decided in favour of the petitioner and against the Revenue. The proceedings ought to had been initiated in a faceless manner as is envisaged under Section l44B of the Act in respect of the proceedings initiated after

07.O4.2021. The impugned order therefore is not sustainable and the same deserves to be and accordingly set aside / quashed and the consequential orders also would thereby be r r t sustainable and the same also are set aside / quashed. Accord r gly, Writ petition No.1219 of 2023 also stands allowed.

29. Coming to Writ Petition No.38716 of 2022,: re grounds raised by the petrtioner in this case are also similar .o the facts and circumstances in Writ Petition No.39706 of 2O.l l. Here also the lmpugned order has been assailed on the same c rcunds of it being I in violation of the principles of natural justice anc )eing in violation of the provisions and procedure prescribed under Section l44B of the Act. Since these two issues have already :een dealt with extensively and decided in Writ Petition No.3970t; of 2022 i.e. one in favour of the Revenue and the other in favour rf the petitioner, on similar lines Writ Petition No.38716 of 2022 alsc stands allowed.

30. Lastly, in Writ Petition No.39666 of 2022 ; lso the grounds raised by the petitioner are also similar tc the facts and circumstances narrated in Writ Petition No.39706 c f 2022. Again in this case also, the petitioner assailed the impugne I order being in violation of the principles of natural justice and it t eing in violation of the provisions and procedure prescribed under jectron L44B of I Page ZB of 28 the Act and of these two issues one was decided in favour of the Revenue and other in favour of the petitioner. Therefore, on similar lines, this writ petition also stands allowed.

31. In the result, the four writ petitions stands allowed.

32. As a sequel, miscellaneous petitions pending if any, shall stand closed. However, there shall be no order as to costs //TRUE COPY// Sd/.P.PONNA KRISHNA ASSISTANT 'EGISTRAReSECTION OFFICER To

1. The Assessment Unit, lncome Tax Department, National Faceless Assessment Centre, Delhi, lncome-tax Department, Ministry of Finance, Room No. 4O1 , 2"d Floor, E-Ramp, Jawaharlal Nehru Stadium' Delhi-1 '10003.

2. The Deputy/Assistant Commissioner of lncome-Tax, Circle 3(1), Signature Towers, Kondapur, Hyderabad-500084.

3. The Principal Cbmmiisioner of lncome-tax - 1' lT Towers, Masab Tank, Hyderabad-500004.

4. The Secretary, Union Of India, Department of Revenue, Ministry of Finance' North Block, New Delhi- 110001.

5. The Additional/JoinUDeputy/Assistant Commissioner of lncome Tax, National Faceless Assessment Centre, Delhi.

6. The Principal Chief Commissioner of lncome Tax Department, MINISTRY OF FINANCE; National Faceless Assessment Center Room No 356 C R. BUILDING, lP Estate, New Delhi, Delhi 110002.

7. The Deputy Commissioner of lncome TAX Regional Faceless Assessment Center,'lniome Tax Department, Central circle-1(4) Ayakar Bhavan, Opposite to L.B.Stadium, Basheer bagh, Hyderabad.

8. The Assessment Officer, Regional Faceless Assessment Center, lncome Tax Department, Central circle-1(4) Ayakar Bhavan, Opposite to L B.Stadium, Basheer bagh, Hyderabad

9. ONC CC tO SRI MANDALA NAGENDRA BABU, AdVOCAIE [OPUC] 10.One CC to SRI J.V.PRASAD & Ms. K.MAMATA, Advocate [OPUC] 1 1 . One CC to SRI V.ANEESH, Advocate (OPUC) 12.OneCc to SRI DUNDU MANMOHAN, Advocate (oPUC) 1 3. One CC tO SMT B.KAVITHA YADAV (CENTRAL GOVT COUNSEL)' Advocate (OPUC)

14.One CC to SRI R.S.ASSOCIATES, Advocate (OPUC) 15.Two CD Copies SA \q- 1l t I HIGH GOURT DATED: 2111112025 ,..) /.//. //t. r1 Q' /-i lr ,., \'- \* _.lr\\ 1l 3 ri [Ut ' ''"" - u'' (l COMMON ORDER WP. NOS: 39706,38716, 39666 0F 2022 AND W.P.NO.1219 0F 2023 ALLOWING ALL THE WRIT PETITIONS WITHOUT COSTS. \+ ofl"I Cr t*"