VARUN vs. INCOME TAX OFFICER AND OTHERS

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CWP/31171/2024HC Punjab & HaryanaPHHC01159023202420 November 2024Author: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
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What did the High Court hold?

The High Court held that notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, and the consequential proceedings initiated under faceless assessment as envisaged by Section 144B were found to be contrary to the provisions of the Act. The Court relied on its previous decisions in Jasjit Singh vs. Union of India and others and Jatinder Singh Bhangu vs. Union of India and others. The reasoning was that instructions by the Board cannot override statutory provisions, and legislative enactments with financial implications must be followed strictly. The Court found that the JAO's notices and subsequent faceless assessment proceedings usurped legal provisions and caused confusion. Therefore, the notices dated 07.04.2023, 28.02.2023, 16.03.2023, 20.03.2024, and 30.03.2023, along with all consequential proceedings, were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly. No issue was expressly left undecided.

What were the facts?

The petitioner, an assessee, challenged a notice dated 07.04.2023 issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated under faceless assessment as envisaged by Section 144B. The petitioner argued that these actions were contrary to the Act and instructions. The respondent-Income Tax Department was represented by a Senior Standing Counsel. The High Court considered two previous judgments of coordinate benches on similar issues: Jasjit Singh vs. Union of India and others (decided on 19.07.2024) and Jatinder Singh Bhangu vs. Union of India and others (decided on 19.07.2024). The amount in dispute is not specified. The procedural history involves the issuance of a Section 148 notice and faceless assessment proceedings.

What were the issues?

1. Whether notices issued by the JAO under Section 148 of the Income Tax Act, 1961, and subsequent faceless assessment proceedings initiated under Section 144B are valid when they are alleged to be contrary to the provisions of the Act and departmental instructions. Assessee's Contention: The petitioner contended that the notice and subsequent proceedings were contrary to the Income Tax Act, 1961, and instructions, implying a lack of jurisdiction or procedural impropriety. They relied on the principle that instructions or circulars cannot override statutory provisions or make them otiose. Revenue's Contention: The revenue, through its counsel, accepted notice and did not present a separate argument, indicating agreement with the petitioner's counsel that the issue had been concluded by previous judgments of coordinate benches.

Which sections of the Income-tax Act were involved?

Section 148,Section 144B,Section 119,Section 120

AI-generated summary — verify with the full judgment below

116 IN TH VARUN

INCOME TAX

CORAM: H

H

Present: M M

f

* SANJEEV PR

1.

N

2.

M on behalf of th

3.

B present petitio No.21509 of decided on 29 2024 titled a decided on 19

C i o o i m HE HIGH COURT OF PUNJA CHANDIGAR

CWP-3 Date of

V X OFFICER WARD-1, HISSAR A HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ (Through Video Conferencin Mr. Nikhil Goyal, Advocate for t Ms. Gauri Neo Rampal, Senior S for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Ms. Gauri Neo Rampal, Senior S he respondents/Income Tax Dep Both the counsel are ad idem on stands finally examined and c f 2023 titled as Jasjit Singh vs 9.07.2024, and by the Coordina as Jatinder Singh Bhangu vs. 9.07.2024. This Court in Jasjit Si “16. We are in agreement with Coordinate Bench and hold t instructions by the Board could n override statutory provisions or t obsolete. Legislative enactmen implications are required to be mandatorily. By exercising the AB AND HARYANA AT RH 31171-2024 (O&M) f Decision:20.11.2024

..…...Petitioner(s) V/s. AND OTHERS …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH ng/Hybrid Mode) the petitioner. Standing Counsel, Department. Standing Counsel, accepts notice partment. that the issue involved in the concluded by this Court in CWP s. Union of India and others, ate Bench in CWP No.15745 of . Union of India and others, Singh (supra) held as under: the view taken by the that such circular or not have been issued to to make them otiose or nts having financial e followed strictly and powers contained in ) e e P , f , Suresh Kumar 2024.11.22 09:20 I attest to the accuracy and integrity of this document

CWP-31171-202

S S a s a t a s i 1 o s w 1 C u p f o p d 3 f 1 l A 2 o p

4.

K aforesaid term mutandis to (Annexure P- 024 (O&M) Sections 119 and 120 of the A Section 144B (7 & 8), the a allowed to usurp the legal pro satisfaction and convenience ca assessees. It also leaves confusio taxpayers. In the opinion of th and circulars can be issued on supplementing the statutory pro implementation.

17.

In view of the aforesaid d occasion to distinguish or take suggested by the learned counse what has already been held by th

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Keeping in view the law Coordinate Bench (supra), notic under Section 148 of the proceedings initiated thereafter w faceless assessment as envisage of the Act, 1961, have been foun provisions of the Act, 1961 an dated 28.02.2023, 16.03.202 30.03.2023 and order dated 30. for want of jurisdiction.

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The respondents-revenue w liberty to follow the procedure a Act, 1961 and proceed according

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All the writ petitions are order passed by the Court shall present order.” Keeping in view above, we a ms. The observations and order p the present case. According -5) issued by the Jurisdictional A Act, 1961 as well as authorities cannot be ovisions to their own ausing hardship to the on in the minds of the his Court, instructions nly for the purpose of ovisions and for their discussion, there is no e a different view as el for the revenue from he Coordinate Bench. w laid down by the ces issued by the JAO Act, 1961 and the without conducting the ed under Section 144B d to be contrary to the nd accordingly notices 23, 20.03.2024 and 03.2023, are set aside would be, however, at as laid down under the gly, if so advised. allowed. The interim stand merged with the allow this Writ Petition in the passed above shall apply mutatis gly, notice dated 07.04.2023 Assessing Officer u/s 148 of the e s 3 e Suresh Kumar 2024.11.22 09:20 I attest to the accuracy and integrity of this document

CWP-31171-202

Income Tax aside.

5.

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November 20 Ess Kay

Whether speak Whether Repor 024 (O&M) Act, 1961 and all consequenti All pending applications also stan [SANJEEV 0, 2024

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king / reasoned :

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Y ial proceedings thereof are set nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No t Suresh Kumar 2024.11.22 09:20 I attest to the accuracy and integrity of this document

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