Virendra Ship Recyclers LLP Vs ACIT (Bombay High Court)
The Bombay High Court considered a writ petition challenging a notice issued under Section 148 of the Income Tax Act, 1961, along with the proceedings and orders arising from it. Among the grounds raised by the petitioners was that the notice had been issued by the Jurisdictional Assessing Officer, whereas, according to the petitioners, the law required it to be issued by the Faceless Assessing Officer. The petitioners contended that this constituted a fatal defect and relied upon the Division Bench decision in Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2) [(2024) 162 com 225 (Bombay)].
The Revenue accepted that the issue was covered by the Hexaware Technologies decision but submitted that the decision had been challenged before the Supreme Court and was likely to be considered shortly. The Revenue also fairly stated that there was no stay against the Hexaware Technologies judgment.
The High Court observed that the issue was fully covered by the earlier decision and that it was bound to follow it. Accordingly, the Court set aside the impugned notice issued under Section 148 and all proceedings and orders emanating from it.
The Court granted liberty to the Revenue to revive the writ petition if the Supreme Court subsequently set aside the Hexaware Technologies decision on this issue. Such revival could be sought by moving a Praecipe, without filing a separate Interim Application. If the Supreme Court dismissed the SLP challenging Hexaware Technologies, there would be no question of revival.
The Court further clarified that, if revived, the petition would have to be decided on its own merits because several other issues had also been raised against the Section 148 notice. The Rule was made absolute, the writ petition was disposed of, and there was no order as to costs.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
1. Respondents waive service. With the consent of the parties, Rule made returnable forthwith and heard finally.
2. The above Writ Petition interalia challenges the Notice issued under Section 148 of the Income Tax Act, 1961 on various grounds. One of the grounds is that the Notice has been issued by the Jurisdictional Assessing Officer when the law mandates that it has to be issued by the Faceless Assessing Officer. This is a fatal defect and therefore the Notice has to be quashed, is the argument of the Petitioner.
3. It is the Petitioners’ contention that this issue is squarely covered by a decision of a Division Bench of this Court in the case of Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2) [(2024) 162 com 225 (Bombay)].
4. On the other hand, the learned advocate appearing on behalf of the Revenue stated that though it is true that this issue is concluded by the decision in Hexaware Technologies Ltd (supra), the said decision has been challenged before the Hon’ble Supreme Court, and the Hon’ble Supreme Court is likely to take up the matter shortly. The learned Counsel for the Revenue has fairly stated that there is no stay to the judgment in Hexaware Technologies Ltd (supra).
5. Considering these facts, we do not propose to keep the matter pending in this Court. Once it is fully covered by the decision in Hexaware Technologies Ltd (supra) we are bound to follow it.
6. We accordingly set aside the impugned Notice issued under Section 148 and all other proceedings/orders emanating therefrom.
7. We however grant liberty to the Revenue to revive the above Writ Petition in the event the decision in Hexaware Technologies Ltd (supra) is set aside by the Hon’ble Supreme Court on this issue. We make it clear that it will not be necessary for the Revenue to file a separate Interim Application to seek a revival of this Petition and the same can be done simply by moving a Praecipe before this Court. It is needless to clarify that if the Hon’ble Supreme Court dismisses the SLP challenging the decision in Hexaware Technologies Ltd (supra), there would be no question of any revival.
8. We also make it clear that once the Petition is revived and restored, the same would have to be decided on its own merits considering that several other issues are also raised challenging the Notice issued under Section 148.
9. Rule is accordingly made absolute and the Writ Petition is also disposed of in terms thereof. However, there shall be no order as to costs.
10. This order will be digitally signed by the Private Secretary/ Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order.
