BAJINDER SINGH vs. ASSISTANT COMMISSIONER OF INCOME TAX, CHANDIGARH

Facts

The petitioner, Bajinder Singh, filed a writ petition challenging a notice dated 26.08.2024 issued by the Assessing Officer under Section 148 of the Income Tax Act, 1961, and consequential assessment proceedings. The petitioner argued that the proceedings were initiated without conducting faceless assessment as envisaged by Section 144B of the Act. The revenue, represented by the Income Tax Department, accepted notice. The High Court noted that similar issues had been decided in previous writ petitions, specifically Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India, which dealt with the validity of notices issued under Section 148 in the context of faceless assessment provisions.

Held

The High Court held that instructions issued by the Board cannot override statutory provisions or make them otiose. Legislative enactments and their implications must be followed strictly. The Court agreed with the Coordinate Bench's view that circulars and instructions can only supplement statutory provisions for their implementation and cannot be used to usurp legal provisions for the convenience of authorities or cause hardship to assessees. Consequently, notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting faceless assessment as envisaged under Section 144B, were found to be contrary to the provisions of the Act. Therefore, the notices dated 26.08.2024, and all consequential proceedings were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act if so advised. The Court allowed the writ petition.

Key Issues

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings are valid if they are not conducted through the faceless assessment scheme as mandated by Section 144B of the Act? Assessee's Contention: The assessee argued that the proceedings initiated under Section 148 were invalid because they were not conducted through the faceless assessment mechanism prescribed by Section 144B of the Income Tax Act, 1961. The assessee relied on the principle that statutory provisions must be followed mandatorily and that instructions or circulars cannot override legislative enactments. Revenue's Contention: The revenue did not present any specific arguments against the assessee's contention. However, the judgment notes that the Senior Standing Counsel accepted notice on behalf of the respondents.