Jharkhand High Court
Shyam Sundar Saw vs Union Of India Through The Secretary on 15 January, 2025
Author: Deepak Roshan
Bench: Deepak Roshan
IN THE HIGH COURT OF JHARKHAND AT RANCHI
W.P. (T) No. 6583 of 2024
Shyam Sundar Saw, aged about 58 years, son of Late Janki Saw, resident
of Dhurva Singh Colony, Near Prabhatam Mall, Nagnagar, P.O.- Dhaiya,
P.S.- Barwadda & District - Dhanbad.
... Petitioner
Versus
1. Union of India through The Secretary, Ministry of Finance, Government
of India, Secretariat Building, North Block, P.O.- Secretariat North, P.S.-
North venue & District - New Delhi-1 110001.
2. The Income Tax Department, through its National Faceless Assessment
Centre, 2nd Floor, E-Ramp, Jawaharlal Nehru Stadium, P.O. Lodhi Road,
P.S. Lodhi Colony, New Delhi- 110003 through Principal Commissioner
of Income Tax, Dhanbad, having its office at Aaykar Bhawan, Luby
Circular Road, P.O.- Combined Building, P.S.- Dhanbad, District -
Dhanbad.
3. Principal Chief Commissioner of Income Tax (Bihar and Jharkhand),
officiating at 1st Floor, Central Revenue Building, Bir Chand Patel Path,
P.O.- G.P.O., P.S.- Kotwali & District - Patna, Bihar - 800001.
4. Deputy Commissioner of Income Tax, Circle - 1, Dhanbad officiating at
Aayakar Bhawan, Luby Circular Road, P.O.- Combined Building, P.S.-
Dhanbad & District - Dhanbad.
5. Assistant Commissioner of Income Tax, Circle - 1, Dhanbad officiating at
Aayakar Bhawan, Luby Circular Road, P.O.- Combined Building, P.S.-
Dhanbad & District - Dhanbad.
... Respondents
---------
CORAM: HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE DEEPAK ROSHAN
---------
For the Petitioner: Mr. Ajit Kumar, Sr. Advocate
Mr. Abhishek Abhi, Advocate
Ms. Divya Shree, Advocate
For Resp. No.1: Mr. Anil Kumar, Addl. S.G.I.
For Resp. Nos.2-5/ITD: Mr. Kumar Vaibhav, Sr. S.C.
Mr. Anurag Vijay, Jr. S.C.
Mr. Om Prakash, Advocate
Mr. Durgesh Agarwal, Advocate
Mr. Srijan, Advocate
---------
05/Dated: 15.01.2025
1) Notice to the respondents. Mr. Anil Kumar, learned A.S.G.I., accepts
notice for respondent No.1 and Mr. Kumar Vaibhav, learned Sr. S.C.,
accepts notice for the respondents Nos. 2 to 5.
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2) Prima facie, we are of the view that the impugned notice, Annexure-3
dt. 31.08.2024, issued under Section 148 of the Income Tax Act, 1961 by
the 4th respondent, who is the Jurisdictional Officer, is wholly without
jurisdiction having regard to Section 151-A, introduced in the Income Tax
Act, 1961 w.e.f. 01.11.2020 and the notification issued on 28.03.2022
thereunder, which specifically contemplates that there would be automated
allocation system in accordance with risk management strategy formulated
by the CBDT and it is not the case of the revenue that the 4th Respondent is
an Officer who has been so randomly allocated as per the Scheme.
3) Similar view has been taken by the Telangana High Court in a
judgment dt. 14.09.2023, rendered in CWP No. 25903 of 2023 and other
connected matters, titled as Kankanala Ravindra Reddy v. ITO [2023] 156
taxmann.com 178/295 Taxman 652 in paras 25 to 27 & 31, which read as
under:
“25. A plain reading of the aforesaid two notifications
issued by the Central Board of Direct Taxes dated
28.03.2022 and 29.03.2022, it would clearly indicate that the
Central Board of Direct Taxes was very clear in its mind
when it framed the aforesaid two schemes with respect to the
proceedings to be drawn under Section 148A, that is to have
it in a faceless manner. There were two mandatory
conditions which were required to be adhered to by the
Department, firstly, the allocation being made through the
automated allocation system in accordance with the risk
management strategy formulated by the Board under Section
148 of the Act. Secondly, the reassessing has to be done in a
faceless manner to the extent provided under Section 144B of
the Act.
26. After the introduction of the above two schemes, it
becomes mandatory for the Revenue to conduct/initiate
proceedings pertaining to reassessment under Section 147,
148 & 148A of the Act in a faceless manner. Proceedings
under Section 147 and Section 148 of the Act would now
have to be taken as per the procedure legislated by the
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Parliament in respect of reopening/re-assessment i.e.,
proceedings under Section 148A of the Act.
27. In the present case, both the proceedings i.e., the
impugned proceedings under Section 148A of the Act, as well
as the consequential notices under Section 148 of the Act
were issued by the local jurisdictional officer and not in the
prescribed faceless manner. The order under Section
148A(d) of the Act and the notices under Section 148 of the
Act are issued on 29.04.2022, i.e., after the “Faceless
Jurisdiction of the Income Tax Authorities Scheme, 2022.”
and the “eAssessment of Income Escaping Assessment
Scheme, 2022 were introduced.
28. ………………….
29. ………………….
30. ………………….
31. It is well settled principle of law that where the power
is given to do certain things in certain way, the thing has to
be done in that way alone and no any other manner which is
otherwise not provided under the law”
4. The Bombay High Court in a judgment dt. 03.05.2024,
rendered in Writ Petition No. 1778 of 2023, titled as Hexaware
Technologies Ltd. v. Asstt. CIT [2024] 162 taxmann.com. 225/404
ITR 430, has also taken a similar view in paras 35 & 39, which read
as under:
“35. ….. 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 not. That automated allocation is
defined in paragraph 2(b) of the Scheme to mean an
algorithm for randomised allocation of cases by using
suitable technological tools including artificial intelligence
and machine learning with a view to optimise the use of
resources. Therefore, it means that the case can be allocated
randomly to any officer who would then have jurisdiction to
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issue the notice under Section 148 of the Act. It is not the
case of respondent no.1 that respondent no.1 was the random
officer who had been allocated jurisdiction.
36 to 38 …………
39. With reference to the decision of the Hon’ble Calcutta
High Court in Triton Overseas Private Limited (supra), the
Hon’ble Calcutta High Court has passed the order without
considering the Scheme dated 29th March 2022 as the said
Scheme is not referred to in the order. Therefore, the said
judgment cannot be treated as a precedent or relied upon to
decide the jurisdiction of the Assessing Officer to issue notice
under Section 148 of the Act. The Hon’ble Calcutta High
Court has referred to an Office Memorandum dated 20th
February 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. Income Tax Officer has held
that in view of the provisions of Section 151A of the Act read
with the Scheme dated 29th March, 2022 the notices issued by
the JAOs are invalid and bad in law. We are also of the same
view.”
5. Therefore, there shall be interim stay of all further proceedings
pursuant to Annexure-3 notice issued to the petitioner, until further
orders.
6. List on 02.04.2025. Reply, if any, be filed in the meanwhile.
(M.S. Ramachandra Rao, C.J.)
(Deepak Roshan, J.)
Manoj/Pramanik/Cp.2
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