Court closes writ petition, allows challenge under Section 148A(d)

The Court closed the writ petition, granting the petitioner liberty to challenge the order under Section 148A(d) on available legal grounds. The decision aligned with the Supreme Court's directions in Union of India & Others Vs. Ashish Agarwal, addressing the challenge to initiating proceedings under Section 148 without first drawing proceedings under Section 148A of the Income Tax Act, 1961.

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Issues:
Challenge to initiation of proceedings under Section 148 of the Income Tax Act, 1961 without first drawing proceedings under Section 148A of the Act.

Detailed Analysis:

Issue 1: Initiation of Proceedings under Section 148 without Drawing Proceedings under Section 148A

The petitioner challenged the initiation of proceedings under Section 148 of the Income Tax Act, 1961, arguing that post-amendment as of 01.02.2021, proceedings under Section 148 could not be initiated without first drawing proceedings under Section 148A. The petitioner contended that the notice was digitally signed after the specified date, rendering the proceedings without jurisdiction. Reference was made to the case of Union of India & Others Vs. Ashish Agarwal, where the Supreme Court issued directions. The petitioner highlighted that despite an interim order in their favor, the respondents proceeded with the notice under Section 148A and passed an order under Section 148A(d) of the Act. The petitioner argued that all subsequent proceedings were illegal as they were initiated without leave of the Court as directed by the Supreme Court.

Issue 2: Response of the Respondents

The respondents argued that even if the notice was digitally signed after the specified date, the situation was governed by the judgment in the case of Union of India & Others Vs. Ashish Agarwal. They justified issuing the notice under Section 148A and passing the order under Section 148A(d) while keeping further proceedings in abeyance due to a contempt notice. The respondents contended that their actions were in line with the Supreme Court's directions and order in the aforementioned case.

Issue 3: Court's Decision

After hearing both parties, the Court noted that an interim order had protected the petitioner based on the digitally signed notice date. The Court referenced the Supreme Court's directions and order in the case of Union of India & Others Vs. Ashish Agarwal, which modified and substituted certain judgments and orders. The Supreme Court's order was declared applicable nationwide, affecting judgments and orders passed by different High Courts. Consequently, the interim order in favor of the petitioner automatically ended. The Court observed that the department had proceeded to pass an order under Section 148A(d) against the petitioner. Considering the changed circumstances and the scope of the petition, the Court decided to close the writ petition, granting the petitioner liberty to challenge the order under Section 148A(d) on available legal grounds.

In conclusion, the Court disposed of the writ petition with the mentioned liberty, aligning its decision with the directions and order issued by the Supreme Court in the case of Union of India & Others Vs. Ashish Agarwal, thereby addressing the challenge to the initiation of proceedings under Section 148 without first drawing proceedings under Section 148A of the Income Tax Act, 1961.

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