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2025 Supreme(Telangana) 400
IN THE HIGH COURT OF TELANGANA
P. SAM KOSHY, NARSING RAO NANDIKONDA, JJ.
Tecumseh Products India Private Limited - Appellant
Vs.
The Deputy Commissioner of Income Tax - Respondent
Writ Petition No.33806 of 2024
Decided On : 24-04-2025
Advocate Appeared:
For the Appellant : G NARENDRA CHETTY
For the Respondent: BOKARO SAPNA REDDY Jr. SC FOR INCOME TAX
The Income Tax Department's issuance of notices under Sections 148A and 148 was quashed for violating the Finance Act, 2021, requiring faceless proceedings, emphasizing adherence to judicial precedents.
Headnote:(A) Income Tax Act, 1961 - Sections 148, 148A, and 151A - Writ petition challenging notices issued under Sections 148A and 148 - Court held that proceedings initiated were in violation of the Finance Act, 2021, requiring faceless issuance - Previous judgments established that similar notices were quashed due to procedural flaws - The Income Tax Department's failure to comply with judicial precedents led to increased litigation. (Paras 4, 10, 17, and 19)
(B) Judicial Discipline - Revenue authorities are bound by the decisions of higher appellate authorities and cannot disregard them merely because they are under appeal - This principle is crucial to prevent harassment of assesses and maintain order in tax administration. (Paras 14 and 15)
Facts of the case:
The petitioner challenged notices issued under Sections 148A and 148 of the Income Tax Act, arguing they were not issued in a faceless manner as required by the Finance Act, 2021. The court noted that similar issues had been decided against the Revenue by various High Courts.
Findings of Court:
The court quashed the impugned notices and orders, emphasizing the need for the Income Tax Department to adhere to established judicial precedents and procedural requirements.
Issues: The main issues included whether the notices were issued in compliance with the Finance Act, 2021, and the implications of ongoing SLPs before the Supreme Court.
Ratio Decidendi: The court ruled that the notices were procedurally flawed and quashed them, reinforcing the principle that revenue authorities must follow judicial decisions unless overturned by a competent court.
Result: Writ petition allowed; notices and consequential orders quashed.
ORDER :
(P. Sam Koshy, J.)
Heard Mr. Harpreet Singh Ajmani, learned counsel representing Mr.G.Narendra Chetty, learned counsel for the petitioner and Ms. B.Sapna Reddy, learned Junior Standing Counsel for the Income Tax Department for respondent Nos.1 and 2. Perused the record.
2. This is a writ petition where the proceedings are either challenged to the notices which were issued under Section 148A and 148 of the Income Tax Act, 1961 (for short ‘the Act’) or the assessment orders those have been passed under Section 147 of the Act which have been assailed.
3. This writ petition is being taken up today only on one of the grounds, that the notices issued under Section 148A of the Act and the subsequent initiation of proceedings under Section 148 of the Act by the jurisdictional Assessing Officer, whereas in terms of the amendment that was brought to the Income Tax Act by way of Finance Act, 2021 w.e.f., 01.04.2021 onwards, proceedings under Section 148A of the Act as also under Section 148 of the Act ought to have also been issued and proceeded in a faceless manner.
4. The contention of the petitioner is that the issue of proceedings being in violation of the Finance Act, 2021 i.e., the impugned notices under Section 148A and Section 148 of the Act not being issued in a faceless manner, have already been dealt with and decided by this Court in the case of KANKANALA RAVINDRA REDDY vs. INCOME-TAX OFFICER, [[(2023) 156 taxmann.com 178 (Telangana)]] decided on 14.09.2023 whereby a batch of writ petitions were allowed and the proceedings initiated under Section 148A as also under Section 148 of the Act were held to be bad with consequential reliefs on the ground of it being in violation of the provisions of Section 151A of the Act read with Notification 18/2022 dated 29.03.2022. The said judgment passed by this Court has also been subsequently followed in a large number of writ petitions which were allowed on similar terms.
5. Down the line, we find that the same issue has also been decided against the Revenue by various High Courts i.e., by the Bombay High Court in the case of HEXAWARE TECHNOLOGIES LTD., vs. ASSISTANT COMMISSIONER OF INCOME TAX & OTHERS, [ [2024] 464 ITR 430 (Bom) ], Gauhati High Court in the case of RAM NARAYAN SAH vs. UNION OF INDIA, [[(2024) 156 taxmann.com 478 (Gauhati)]], Punjab and Haryana High Court in the case of JATINDER SINGH BANGU vs. UNION OF INDIA, [[(2024) 165 taxmann.com 115 (Punjab & Haryana)]], and Telangana High Court in the case of SRI VENKATARAMANA REDDY PATLOOLA vs. DEPUTY COMMISSIONER OF INCOME TAX, [[2024) 167 taxmann.com 411 (Telangana)]] where the issue was in respect of international taxation, Bombay High Court in the case of ABHIN ANILKUMAR SHAH vs. INCOME TAX OFFICER, INTERNATIONAL TAXATION, [[2024) 166 taxmann.com 679 (Bombay)]] which is again on international taxation and central circle, High Court of Himachal Pradesh in the case of GOVIND SINGH vs. INCOME TAX OFFICER, [[2024) 165 taxmann.com 113 (Himachal Pradesh)]], Gujarat High Court in the case of MANSUKHBHAI DAHYABHAI RADADIYA vs. INCOME TAX OFFICER, WARD 3(3)(5), [82024 SCC OnLine Guj 4012], Jharkand High Court in the case of SHYAM SUNDAR SAW vs. UNION OF INDIA, [2025 SCC OnLine Jhar 287], Rajasthan High Court in the case of SHARDA DEVI CHHAJER vs. INCOME TAX OFFICER & ANOTHER and batch of writ petitions, [2023 RJ-JD 4984-DB] which stood decided on 19.03.2024. Similar views have also been taken by the Division Bench of Calcutta High Court in the case of GIRDHAR GOPAL DALMIA vs. UNION OF INDIA & ORS (M.A.T 1690 of 2023), decided on 25.09.2024.
6. Even though the same issue having been decided by a large number of High Courts, we are still confronted with large filing of identical matters on daily basis ranging between 5 to 10 writ petitions. That upon the instructions being sought from the Department, they have been taking a solitary ground that the decision of the Bombay High Court in the case of Hexaware Technologies Ltd., (2 supra) as
