Članak 148. Obavijest poništena jer je usvojeni postupak sam po sebi nezakonit: ITAT Mumbai
Chemox Exports Imports Pvt. Ltd. protiv Jedinice za procjenu poreza na dohodak (ITAT Mumbai) ITAT Mumbai smatrao je da su obavijest izdana prema odjeljku 148 Zakona o porezu na dohodak i usvojeni postupak sami po sebi nezakoniti, stoga obavijesti zaslužuju da budu poništene/poništene. Činjenice – Procjenitelj daje prednost ovoj žalbi koja uglavnom osporava ponovno otvaranje postupka procjene izdavanjem obavijesti prema članku 148. Zakona o porezu na dohodak tvrdeći da je nevaljana i ništavna. Zaključak – Visoki sud Visokog suda u Telangani u slučaju Kankanala Ravindra Reddy protiv ITO-a smatrao je da je postupak koji treba slijediti tuženo Odjel nakon postupanja s obavijestima izdanim za ponovnu procjenu prema odjeljku 148A, naknadni postupak obvezno mora biti poduzeto prema zamijenjenim odredbama kako je propisano Zakonom o financijama iz 2021. U nedostatku toga, prisiljeni smo zaključiti da je postupak koji je usvojio tuženi Odjel u suprotnosti sa statutom, tj. Zakonom o financijama iz 2021. Presuđeno je da tako izdane obavijesti i usvojeni postupak sami po sebi su nezakoniti, a osporene obavijesti zaslužuju poništenje/poništenje čime se poništava rezultirajući nalog za procjenu. Budući da smo osporene obavijesti stavili na stranu, ne smatramo potrebnim ulaziti u meritum predmeta. POTPUNI TEKST NALOGA ITAT MUMBAI Ova žalba ocjenjivača daje prednost u odnosu na nalog od 21/06/2024 koji je donio NFAC, Delhi, a koji se odnosi na AY 2018-19. 2. Pritužba ocjenjenika glasi: – “1. Ld. CIT(A) je pogriješio u pravu i činjenicama donošenjem naloga u/s .250 Zakona i djelomičnom potvrđivanjem dodatka Ld. AO 2. Ld. CIT(A) je pogriješio u pravu i činjenicama procijenivši da je ponovno otvaranje postupka procjene izdavanjem obavijesti u/s. 148. Zakona bio je nevažeći i 3. Ld. CIT(A) je pogriješio u primjeni prava i činjenica potvrđujući prihod od najma žalitelja u Rs. 56,76,770/- umjesto Rs. 51,16,011/-. 4. Ld. CIT(A) je pogriješio u primjeni prava i činjenica potvrđujući dodavanje Rs. 8,00,000/- na račun neobjavljene prodaje. 5. Ld. CIT(A) je pogriješio u primjeni zakona i činjenica potvrđujući dodatak na račun naknada za usluge od Rs. 29.70.941/- kao neprikazan prihod žalitelja. 6. Ld. CIT(A) je pogriješio u primjeni prava i činjenica potvrđujući neprihvatanje koje je napravio Ld. AO na račun poslovnih rashoda od Rs. 30,027/-.” 3. Vidi temelj br. 2, procjenitelj je osporio ponovno otvaranje postupka procjene izdavanjem obavijesti u/s 148 Zakona tvrdeći da je nevaljana i ništavna. 4. Predstavnici obiju strana saslušani su opširno, spisi predmeta su pažljivo proučeni, a relevantni dokumentarni dokazi propisno razmotreni u svjetlu Pravila 18(6) Pravila FTAT-a iz 1963. 5. Objašnjavajući činjenice slučaja, ld. Odvjetnik ocjenjivača snažno se oslanjao na odluku Visokog suda u Bombaju u slučaju Hexaware Technologies Ltd. protiv ACIT & Ors. [2024] 464 ITR 430 (Born.) i pročitati izreku ističući da su pobijane obavijesti koje se razmatraju ne samo nevaljane, već i pravno loše. ld. D/R nije mogao donijeti nikakvu značajnu odluku u korist prihoda. 6. Pažljivo smo razmotrili naredbe nadležnih tijela u nastavku. Osporene obavijesti su sljedeće: – 7. Prethodno navedene obavijesti moraju se razmotriti u svjetlu odredaba Odjeljka 151A Zakona, koji glasi kao pod: – “151A. (1) Središnja država može napraviti shemu, putem obavijesti u Narodnim novinama, u svrhu procjene, ponovne procjene ili ponovnog izračuna prema odjeljku 147 ili izdavanja obavijesti prema odjeljku 14881[or conducting of enquiries or issuance of show-cause notice or passing of order under section 148AJ or sanction for issue of such notice under section 151, so as to impart greater efficiency, transparency and accountability by –
(a) eliminating the interface between the income-tax authority and the assessee or any other person to the extent technologically feasible;
(b) optimising utilisation of the resources through economies of scale and functional specialisation;
(c) introducing a team-based assessment, reassessment, re-computation or issuance or sanction of notice with dynamic jurisdiction.
(2) The Central Government may, for the purpose of giving effect to the scheme made under sub-section (1), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the notification:
Provided that no direction shall be issued after the 31st day of March, 2022.
(3) Every notification issued under sub-section (1) and sub-section (2) shall, as soon as may be after the notification is issued, be laid before each House of Parliament .1″
8. Pursuant to the provisions of Section 151A of the Act mentioned hereinabove, the Central Government made the following scheme:-
“e-Assessment of Income Escaping Assessment Scheme, 2022 Notification No. S. O. 1466(E), dated 29th March 2022In exercise of the powers conferred by sub-sections (.) and (2) of section 151A of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby makes the following Scheme, namely :-
1. Short title and commencement. —(1) This Scheme may be called the e~ Assessment of Income Escaping Assessment Scheme, 2022.
(2) It shall come into force with effect from the date of its publication in the Official Gazette.
2. Definitions.—(- (1) In this Scheme, unless the context otherwise requires,-
(a) ‘Act’ means the Income-tax Act, 1961 (43 of 1961);
(b) “automated allocation” means 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. (2) Words and expressions used herein and not defined, but defined in the Act, shall have the meaning respectively assigned to them in the Act.
3. Scope of the Scheme.-For the purpose of this Scheme,-
(a) assessment, reassessment or recomputation under section 147 of the Act,
(b) issuance of notice under section 148 of the Act,
Shall be through automated allocation, in accordance with risk management strategy formulated by the Board as referred to in section 148 of the Act for issuance of notice, and in a faceless manner, to the extent provided in section 144B of the Act with reference to making assessment or reassessment of total income or loss of assessee.
9. The aforementioned scheme was thoroughly examined by the Hon’ble Jurisdictional High Court of Bombay in the case of Hexaware Technologies (supra), wherein the Hon’ble High Court interalia considered the following issue:-
“Whether the impugned notice dated 27th August 2022 is invalid and bad in law being issued by the Jurisdictional Assessing Officer as the same was not in accordance with Section 151A of the Act?”
9.1. And the Hon’ble Jurisdictional High Court, answered the aforementioned issue as under :-
“32. As regards issue no. 4, Section 151A reads as under:
151A. Faceless assessment of income escaping assessment. – (1) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of assessment, reassessment or recomputation under section 147 or issuance of notice under section 148 [or conducting of enquiries or issuance of show-cause notice or passing of order under section 148AJ or sanction for issue of such notice under section 151, so as to impart greater efficiency, transparency and accountability by –
(a) eliminating the interface between the income-tax authority and the assessee or any other person to the extent technologically feasible;
(b) optimising utilisation of the resources through economies of scale and functional specialisation;
(c) introducing a team-based assessment, reassessment, recomputation or issuance or sanction of notice with dynamic jurisdiction.
(2) The Central Government may, for the purpose of giving effect to the scheme made under sub-section (1), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the notification:
Provided that no direction shall be issued after the 31st day of March, 2022.
(3) Every notification issued under sub-section (1) and sub-section (2) shall, as soon as may be after the notification is issued, be laid before each House of Parliament.
Section 151A of the Act gives the power to the Central Board of Direct Taxes (‘CBDT’) to notify the Scheme for:
(i) the purpose of assessment, reassessment or recomputation under section 147; or
(ii) issuance of notice under section 148; or
(iii) conducting of inquiry or issuance of show cause notice or passing of orderunder section 148A; or
(iv) sanction for issuance of notice under section 151;
so as to impart greater efficiency, transparency and accountability by inter alia eliminating the interface between the Income-tax Authorities and assessee. Subsection 3 of Section 151A of the Act also provides that every notification issued under sub-section (1) and (2) of Section 151A of the Act shall be laid before each House of Parliament.
In exercise of the powers conferred by sub-sections (1) and (2) of Section 151A of the Act, CBDT issued a notification dated 29th March, 2022 [Notification No. 18/2022/F. No. 370142/16/2022-TPL and formulated a Scheme. The Scheme provides that –
(a) the assessment, reassessment or recomputation under section 147 of the Act,
(b) and the issuance of notice under section 148 of the Act, shall be through automated allocation, in accordance with risk management strategy formulated by the Board as referred to in Section 148 of the Act for issuance of notice and in a faceless manner, to the extent provided in Section 144B of the Act with reference to making assessment or reassessment of total income or loss of assessee. The impugned notice dated 27th August, 2022 has been issued by respondent no. 1 (lAO) and not by the NFAC, which is not in accordance with the aforesaid Scheme.
33. The guideline dated 1st August 2022 relied upon by the Revenue is not applicable because these guidelines are internal guidelines as is clear from the endorsement on the first page of the guideline – ‘Confidential For Departmental Circulation Only’. The said guidelines are not issued under section 119 of the Act. Any such guideline issued by the CBDT is not binding on petitioner. Further the said guideline is also not binding on respondent no. 1 as they are contrary to the provisions of the Act and the Scheme framed under section 151A of the Act. The effect of a guideline came up for discussion in Sofitel Realty LLP v. ITO (TDS) 120231153 taxmann.com 496/294 Taxman 766/457 ITR 18 (Bom.) wherein this Court has held that the guidelines which are contrary to the provisions of the Act cannot be relied upon by the Revenue to reject an application for compounding filed by an assessee. The Court held that guidelines are subordinate to the principal Act or Rules, it cannot restrict or override the application of specific provisions enacted by legislature. The guidelines cannot travel beyond the scope of the powers conferred by the Act or the Rules.
The guidelines do not deal with or even refer to the Scheme dated 29th March 2022 framed by the Government under section 151A of the Act. Section 151A(3) of the Act provides that the Scheme so framed is required to be laid before each House of the Parliament. Therefore, the Scheme dated 29th March 2022 under section 151A of the Act, which has also been laid before the Parliament, would be binding on the Revenue and the guideline dated 1st August 2022 cannot supersede the Scheme and if it provides anything to the contrary to the said Scheme, then the same is required to be treated as invalid and bad in law.
34. As regards ITBA step-by-step Document No. 2 regarding issuance of notice under section 148 of the Act, relied upon by Revenue, an internal document cannot depart from the explicit statutory provisions of, or supersede the Scheme framed by the Government under section 151A of the Act which Scheme is also placed before both the Houses of Parliament as per Section 151A(3) of the Act. This is specially the case when the document does not even consider or even refer to the Scheme. Further the said document is clearly intended to be a manual/guide as to how to use the Income-tax Department’s portal, and does not even claim to be a statement of the Revenue’s position/stand on the issue in question. Qur observations with respect to the guidelines dated 1st August 2022 relied upon by the Revenue will equally be applicable here.
35. Further, in our view, there is no question of concurrent jurisdiction of the fAQ and the FAQ for issuance of notice under section 148 of the Act or even for passing assessment or reassessment order. When specific jurisdiction has been assigned to either the fAQ or the FAQ in the Scheme dated 29th March, 2022, then it is to the exclusion of the other. To take any other view in the matter, would not only result in chaos but also render the whole faceless proceedings redundant. If the argument of Revenue is to be accepted, then even when notices are issued by the FAQ, it would be open to an assessee to make submission before the fAQ and vice versa, which is clearly not contemplated in the Act. Therefore, there is no question of concurrent jurisdiction of both FAQ or the fAQ with respect to the issuance of notice under section 148 of the Act. The Scheme dated 29th March 2022 in paragraph 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 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. With respect to the arguments of the Revenue, i.e., the notification dated 29th March 2022 provides that the Scheme so framed is applicable only ‘to the extent’ provided in Section 144B of the Act and Section 144B of the Act does not refer to issuance of notice under section 148 of the Act and hence, the notice cannot be issued by the FAQ as per the said Scheme, we express our view as follows:-
Section 151A of the Act itself contemplates formulation of Scheme for both assessment, reassessment or recomputation under section 147 as well as for issuance of notice under section 148 of the Act. Therefore, the Scheme framed by the CBDT, which covers both the aforesaid aspect of the provisions of Section 151A of the Act cannot be said to be applicable only for one aspect, i.e., proceedings post the issue of notice under section 148 of the Act being assessment, reassessment or recomputation under section 147 of the Act and inapplicable to the issuance of notice under section 148 of the Act. The Scheme is clearly applicable for issuance of notice under section 148 of the Act and accordingly, it is only the FAQ which can issue the notice under section 148 of the Act and not the JAQ. The argument advanced by respondent would render clause 3(b) of the Scheme otiose and to be ignored or contravened, as according to respondent, even though the Scheme specifically provides for issuance of notice under section 148 of the Act in a faceless manner, no notice is required to be issued under section 148 of the Act in afaceless manner. In such a situation, not only clause 3(b) but also the first two lines below clause 3(b) would be otiose, as it deals with the aspect of issuance of notice under section 148 of the Act. Respondents, being an authority subordinate to the CBDT, cannot argue that the Scheme framed by the CBDT, and which has been laid before both House of Parliament is partly otiose and inapplicable. The argument advanced by respondent expressly makes clause 3(b) otiose and impliedly makes the whole Scheme otiose. If clause 3(b) of the Scheme is not applicable, then only clause 3(a) of the Scheme remains. TA/hat is covered in clause 3(a) of the Scheme is already provided in Section 144B(1) of the Act, which Section provides for faceless assessment, and covers assessment, reassessment or recompu tation under section 147 of the Act. Therefore, if Revenue’s arguments are to be accepted, there is no purpose offraming a Scheme only for clause 3(a) which is in any event already covered under faceless assessment regime in Section 144B of the Act. The argument of respondent, therefore, renders the whole Scheme redundant. An argument which renders the whole Scheme otiose cannot be accepted as correct interpretation of the Scheme. The phrase “to the extent provided in Section 144B of the Act” in the Scheme is with reference to only making assessment or reassessment or total income or loss of assessee. Therefore, for the purposes of making assessment or reassessment, the provisions of Section 144B of the Act would be applicable as no such manner for reassessment is separately provided in the Scheme. For issuing notice, the term “to the extent provided in Section 144B of the Act” is not relevant. The Scheme provides that the notice under section 148 of the Act, shall be issued through automated allocation, in accordance with risk management strategy formulated by the Board as referred to in Section 148 of the Act and in a faceless manner. Therefore, “to the extent provided in Section 144B of the Act” does not go with issuance of notice and is applicable only with reference to assessment or reassessment. The phrase “to the extent provided in Section 144B of the Act” would mean that the restriction provided in Section 144B of the Act, such as keeping the International Tax Jurisdiction or Central Circle Jurisdiction out of the ambit of Section 144B of the Act would also apply under the Scheme. Further the exceptions provided in sub-section (7) and (8) of Section 144B of the Act would also be applicable to the Scheme.
37. TA/hen an authority acts contrary to law, the said act of the Authority is required to be quashed and set aside as invalid and bad in law and the person seeking to quash such an action is not required to establish prejudice from the said Act. An act which is done by an authority contrary to the provisions of the statue, itself causes prejudice to assessee. All assessees are entitled to be assessed as per law and by following the procedure prescribed by law. Therefore, when the Income-tax Authority proposes to take action against an assessee without following the due process of law, the said action itself results in a prejudice to assessee. Therefore, there is no question of petitioner having to prove further prejudice before arguing the invalidity of the notice.
38. With respect to the Office Memorandum dated 20th February 2023, the said Office Memorandum merely contains the comments of the Revenue issued with the approval of Member (L&S) CBD7 and the said Office Memorandum is not in the nature of a guideline or instruction issued under section 119 of the Act so as to have any binding effect on the Revenue. Moreover, the arguments advanced by the Revenue on the said Office Memorandum dated 20th February 2023 is clearly contrary to the provisions of the Act as well as the Scheme dated 29th March 2022 and the same are dealt with as under –
(i) It is erroneously stated in paragraph 3 of the Office Memorandum that “7he scheme clearly lays down that the issuance of notice under section 148 of the Act has to be through automation in accordance with the risk management strategy referred to in section 148 of the Act.” 7he issuance of notice is not through automation but through “automated allocation”. 7he term “automated allocation” is defined in clause 2(1) (b) of the said Scheme to mean random allocation of cases to Assessing Officers. 7herefore, it is clear that the Assessing Officer are randomly selected to handle a case and it is not merely a case where notice is sought to be issued through automation.
(ii) It is further erroneously stated in paragraph 3 of the Office Memorandum that “7o this end, as provided in the section 148 of the Act, the Directorate of Systems randomly selects a number of cases based on the criteria of Risk Management Strategy.” 7he term ‘randomly’ is further used at numerous other places in the Office Memorandum with respect to selection of cases for consideration/issuance of notice under section 148 of the Act. Respondent is clearly incorrect in its understanding of the said Scheme as the reference to random in the said Scheme is reference to selection of Assessing Officer at random and not selection of Section 148 cases as random. If the cases for issuance of notice under section 148 of the Act are selected based on criteria of the risk management strategy, then, obviously, the same are not randomly 7he term ‘randomly’ by definition mean something which is chosen by chance rather than according to a plan. 7herefore, if the cases are chosen based on risk management strategy, they certainly cannot be said to be random. 7he Computer/System cannot select cases on random but selection can be based on certain well-defined criteria. Hence, the argument of respondents is clearly unsustainable. If the case of respondent is that the applicability of Section 148 of the Act is on random basis, then the provision of Section 148 itself would become contrary to Article 14 of the Constitution of India as being arbitrary and unreasonable. Randomly selecting cases for reopening without there being any basis or criteria would mean that the section is applied by the Revenue in an arbitrary and unreasonable manner. 7he word ‘random’ is used in clause 2 (1)(b) of the said Scheme in the definition of “automated allocation”. “Automated allocation” is defined in the said clause to mean “an algorithm for randomised allocation of cases…..”. 7he term ‘random’, in our view, has been used in the context of assigning the case to a random Assessing Officer, i.e., an Assessing Officer would be randomly chosen by the system to handle a particular case. The term ‘random’ is not used for selection of case for issuance of notice under section 148 as has been alleged by the Revenue in the Office Memorandum. Further, in paragraph 3.2 of the Office Memorandum, with respect to the reassessment proceedings, the reference to ‘random allocation’ has correctly been made as random allocation of cases to the Assessment Units by the National Faceless Assessment Centre. When random allocation is with reference to officer for reassessment then the same would equally apply for issuance of notice under section 148 of the Act.
(iii) The conclusion at the bottom of page 2 in paragraph 3 of the Office Memorandum that ‘Therefore, as provided in the scheme the notice under section 148 of the Act is issued on automated allocation of cases to the Assessing Officer based on the risk management criteria ‘ is also factually incorrect and on the basis of incorrect interpretation of the Scheme. Clause 2(1)(b) of the Scheme defined ‘automated allocation’ 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’. The said definition does not provide that the automated allocation of case to the Assessing Officer is based on the risk management criteria. The reference to risk management criteria in clause 3 of the Scheme is to the effect that the notice under section 148 of the Act should be in accordance with the risk management strategy formulated by the board which is in accordance with Explanation 1 to Section 148 of the In our view, the Revenue is misinterpreting the Scheme, perhaps to cover its deficiency of not following the Scheme for issuing notice under section 148 of the Act.
(iv) In paragraph 3.1 of the Office Memorandum, it is stated that the case is selected prior to issuance of notice are decided on the basis of an algorithm as per risk management strategy and are, therefore, randomly selected. It is further stated that these cases are ‘flagged’ to the lAO by the Directorate of Systems and the lAO does not have any control over the process. It is further stated that the lAO has no way of predicting or determining beforehand whether the case will be ‘flagged’ by the system. The contention of the Revenue is that only cases which are ‘flagged’ by the system as per the risk management strategy formulated by CBDT can be considered by the Assessing Officer for reopening, however, in clause (i) in the Explanation 1 to Section 148 of the Act, the term ‘flagged ‘ has been deleted by the Finance Act, 2022, with effect from 1st April 2022. In any case, whether only cases which are flagged can be reopened or not is not relevant to decide the scope of the Scheme framed under section 151A of the Act, which required the notice under section 148 of the Act to be issued on the basis of random allocation and in a faceless manner.
(v) The Revenue has wrongly contended in paragraph 3.1 of the Office Memorandum that ‘Therefore, whether lAO or NFAC should issue such notice is decided by administration keeping in mind the end result of naturaljustice to the assessees as well as completion of required procedure in a reasonable time.’ In our opinion, there is no such power given to the administration under either Section 151A of the Act or under the said Scheme. The Scheme is clear and categorical that notice under section 148 of the Act shall be issued through automated allocation and in a faceless manner. Therefore, the argument of the Revenue is clearly contrary to the provisions of the Scheme.
(vi) In paragraph 3.3 of the Office Memorandum, it is again erroneously stated that’Here it is pertinent to note that the said notification does not state whether the notices to be issued by the NFAC or the Jurisdictional Assessing Officer (‘JAO’)……It states that issuance of notice under section 148 of the Act shall be through automated allocation in accordance with the risk management strategy and that the assessment shall be in faceless manner to the extent provided in section 144B of the Act.’ The Scheme is categoric as stated aforesaid that the notice under section 148 of the Act shall be issued through automated allocation and in a faceless manner. The Scheme clearly provides that the notice under section 148 of the Act is required to be issued by NFAC and not the JAO. Further, unlike as canvassed by Revenue that only the assessment shall be in faceless manner, the Scheme is very clear that both the issuance of notice and assessment shall be in faceless manner.
(vii) In paragraph 5 of the Office Memorandum, a completely unsustainable and illogical submission has been made that Section 151A of the Act takes into account that procedures may be modified under the Act or laid out taking into account the technological feasibility at the time. Reading the said Scheme along with Section 151A of the Act makes it clear that neither the Section or the Scheme speak about the detailed specifics of the procedure to be followed This argument of the Revenue is clearly contrary to the Scheme as the Scheme is very specific to provide, inter alia, that the issuance of notice under section 148 of the Act shall be through automated location and in a faceless manner. Therefore, the Scheme is mandatory and provides the specification as to how the notice has to be issued. Further the argument of the Revenue that Section 151A of the Act takes into account that the procedure may be modified under the Act is without appreciating that if the procedure is required to be modified then the same would require modification of the notified Scheme. It is not open to the Revenue to refuse to follow the Scheme as the Scheme is clearly mandatory and is required to be followed by all Assessing Officers.
(viii) The argument of the Revenue in paragraph 5.1 of the Office Memorandum that the Section and Scheme have left it to the administration to device and modify procedures with time while remaining confined to the principles laid down in the said Section and Scheme, is without appreciating that one of the main principles laid down in the Scheme is that the notice under section 148 of the Act is required to be issued through automated allocation and in a faceless manner. There is no leeway given on the said aspect and, therefore, there is no question of the administration to device and modify procedures with respect to the issuance of notice.
39. With reference to the decision of the Hon ble Calcutta High Court in Triton Overseas (P.) Ltd. (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 2023 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 v. ITO [2023]156 taxmann.com 178/295 Poreznik 652 (Telangana) je smatrao da su u svjetlu odredaba Odjeljka 151A Zakona koji se čita sa Shemom od 29. ožujka 2022. obavijesti koje su izdali JAO-i nevažeće i loše u zakonu. I mi smo istog stava.” 10. Iz navedenog se može vidjeti da je Visoki časni sud slijedio stajalište Visokog suda u Telangani u predmetu Kankanala Ravindra Reddy protiv ITO-a. [2023] 156 taxmann.com 178 (Telangana) i bilo bi primjereno pozvati se na relevantni kontekst presude Visokog suda Hon’ble Telangana, radi cjelovitosti:- “26. Nakon uvođenja gornje dvije sheme, Porezna uprava postaje obavezna provesti/pokrenuti postupke koji se odnose na ponovnu procjenu prema odjeljcima 147, 148 i 148A Zakona na nepristran način. Postupci prema odjeljku 147. i odjeljku 148. Zakona sada bi se morali poduzeti u skladu s postupkom koji je propisao Parlament u pogledu ponovnog otvaranja/ponovne procjene, tj. postupaka prema odjeljku 148A Zakona. 27. U ovom slučaju, oba postupka, tj. sporni postupak prema članku 148A Zakona, kao i posljedične obavijesti prema članku 148 Zakona izdao je lokalni nadležni službenik, a ne u propisanom bezličnom nalogu prema odjeljak 148A(d) Zakona i obavijesti prema članku 148 Zakona izdaju se 29-4-2 022, tj. nakon ‘Faceless Jurisdiction of the Income-tax Authorities Scheme, 2022’ i’e-Assessment Income Escapeing Assessment Scheme, 2022′ su uvedeni. 28. Iz gore navedene činjenične matrice, prvo zakonskih odredbi nabrojanih u prethodnim paragrafima i drugo, naknadnih smjernica koje je dao Časni Vrhovni sud u predmetu Ashish Agarwal, supra, ono što se jasno odražava je činjenica da kada Časni Vrhovni sud djelomično je dopustio peticije koje je podnijela Unija Indije u kojima se osporavaju presude raznih visokih sudova prema kojima su visoki sudovi poništili obavijest prema odjeljku 148 neizmijenjenog zakona, Časni Vrhovni sud je samo dopustio Unija Indije da nastavi s postupkom ponovne procjene prema izmijenjenoj odredbi zakona, točnije, kako je izmijenjena Zakonom o financijama iz 2021. Nikada nije namjeravala dotična tijela nastaviti s postupkom od faze izdavanja obavijesti prema odjeljak 148, niti upute u tom smislu. I ne može biti nikakve zabune, dvosmislenosti ili pogrešnog shvaćanja za tuženo Odjel u vezi s tim. 29. Časni Vrhovni sud je u paragrafu br. 7 izričito ustvrdio da su Visoki sudovi s pravom zaključili da će povlastica novih odredbi biti dostupna u odnosu na postupke koji se odnose na prošle godine procjene. Nadalje, časni Vrhovni sud ponovno je u stavku br. 8 vrlo odlučno rekao da postupak nije trebao biti pokrenut prema neizmijenjenom Zakonu. Umjesto toga, trebalo je biti izdano prema zamijenjenim odredbama u skladu sa Zakonom o financijama, Nadalje, u istom paragrafu jasno je naloženo Odjelu za porez na dohodak da nastavi dalje u skladu sa Zakonom o financijama iz 2021., podložno usklađenosti sa svim postupovnim zahtjevima i obranama dostupna osobi koja procjenjuje prema zamijenjenim odredbama iz Zakona o financijama iz 2021. Činjenica da je časni Vrhovni sud dopustio da se obavijest ranije izdana prema odjeljku 148 tretira kao obavijest prema odjeljku 148A, a nadalje se s njom također može postupati kao s prikazom Obavijest o razlogu izdana prema odjeljku 148A(b) sama po sebi utvrđuje činjenicu da su upute koje je dao Časni Vrhovni sud tuženom odjelu trebale postupiti dalje u skladu sa zamijenjenim odredbama koje su uvedene Zakonom o financijama iz 2021. 30 . U ovom predmetu, nedvojbeno, tuženi Odjel nije postupio protiv podnositelja zahtjeva prema zamijenjenim odredbama Zakona o financijama iz 2021. Naprotiv, postupio je prema neizmijenjenim odredbama zakona. Drugim riječima, ovo vraća stanje na stanje kakvo je bilo kada su izdane početne obavijesti prema članku 148 prema neizmijenjenim odredbama zakona. Drugim riječima, ovo nas također vodi do pozicije ili faze prije velikog broja pismenih peticija koje su dopuštene diljem zemlje, otprilike 9 000 u broju i koje je potvrdio Časni Vrhovni sud također vidi presudu Ashish Agarwal, supra. 31. Dobro je utvrđeno načelo zakona da kada je dana ovlast da se određene stvari čine na određeni način, stvar se mora učiniti samo na taj način i ni na koji drugi način koji inače nije predviđen zakonom. 32. Časni Vrhovni sud u predmetu Chandra Kishore Jha protiv Mahaveera Prasada [19991 8 SCC 266 in paragraph No. 17 laying down the aforesaid principle held as under ‘it is well 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 principle of law was further reiterated in the case of Cherrukuri Mani v. Chief Secretary Government of Andhra Pradesh [2015113 SCC 722, wherein, again in paragraph No. 14, the aforesaid principle has been reinforced by the Hon’ble Supreme Court holding 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 following 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 (MCGM) v. Abhilash Lal [20191 111 com 405/[2 0201 157 SCL 477 (SC)/[2 020113 SCC 234, and in the case of Opto Circuit India Ltd. v. Axis Bank [20211127 taxmann.com 290/165 SCL 703 (SC)/[2 0211 6 SCC 707 and again in the case of Union of India v. Mahendra Singh [CAP No. 4807 of 2022, dated 25-7-20221. In the case of Tata Chemicals Ltd. v. Commissioner of Customs (preventive) Jam Nager [20151 58 taxmann.com 126/12015! 11 SCC 628, wherein it has been held that there can be no stopple against the law. If the law requires something to be done in a particular manner, then it must be done in that manner, if it is not done in that manner then it would have no existence in the eye of law. In paragraph 18 of the said judgment, the Hon’ble Supreme Court held as under:
“The Tribunal’s judgment has proceeded on the basis that even though the samples were drawn contrary to law, the appellants would be estopped because their representative was present when the samples were drawn and they did not object immediately. This is a completely perverse finding both on fact and law. On fact, it has been more than amply proved that no representative of the appellant was, in fact, present at the time the Customs Inspector took the samples. Shri K.M. Jani who was allegedly present not only stated that he did not represent the Clearing Agent of the appellants in that he was not their employee but also stated that he was not present when the samples were taken. In fact, therefore, there was no representative of the appellants when 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 manner, it must be done in that manner, 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 which 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 Hon’ble Supreme Court while exercising its power under Article 142 of the Constitution of India has also not relaxed the applicability of the Finance Act 2021. Rather, the Hon’ble Supreme Court in very clear and unambiguous terms had held that the notices issued under the unamended provisions, which were struck down by the High Court, shall be treated as a notice under new amended provisions and the Union of India was directed to proceedfurther from that stage in terms of the amended provisions of law. In spite of such specific clear directions by the Hon’ble Supreme Court, the Union of India for reasons best known again proceeded with the procedure as it stood prior to the amended provisions which came into force from 1-4-2 021.
35. In view of the aforesaid discussions, it is by now very clear that the procedure to be followed by the respondent-Department upon treating the notices issued for reassessment being under section 148A, the subsequent proceedings was mandatorily required to be undertaken under the substituted provisions as laid down under the Finance Act, 2021. In the absence of which, we are constrained to hold that the procedure adopted by the respondent-Department is in contravention to the statute i.e. the Finance Act, 2021, at the first instance. Secondly, it is also in direct contravention to the directives issued by the Hon ble Supreme Court in the case of Ashish Agarwal, supra.
36. For all the aforesaid reasons, the impugned notices issued and the proceedings drawn by the respondent-Department is neither tenable, nor sustainable. The notices so issued and the procedure adopted being per se illegal, deserves to be and are accordingly set aside/quashed. As a consequence, all 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 The reason we are quashing the consequential order is on the principles that when the initiation of the proceedings itself was procedurally wrong, the subsequent orders also gets nullified automatically.
37. The preliminary objection raised by the petitioner is sustained and all these writ petitions stands allowed on this very jurisdicti onal issue. Since the impugned notices and orders are getting quashed on the point of jurisdiction, we are not inclined to proceed further and decide the other issues raised by the petitioner which stands reserved to be raised and contended in an appropriate proceedings.”
11. Considering the notices mentioned elsewhere, in light of the decisions of the Hon’ble Jurisdictional High Court and Hon’ble Telangana High Court, we have no hesitation to hold that the notices so issued and the procedure adopted being per se illegal and the impugned notices deserve to be set aside/quashed thereby quashing the resultant assessment order. Since we have set aside the impugned notices, we do not find it necessary to delve into the merits of the case.
12. In the result, appeal of the assessee is allowed.
Order pronounced in the Court on 17th October, 2024 at Mumbai.
