RESHMA DEVI vs. INCOME TAX OFFICER, WARD 1, SIRSA AND ANOTHER

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CWP/14528/2023HC Punjab & HaryanaPHHC01071835202318 November 2024Author: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that circulars or instructions issued by the Board cannot override statutory provisions or render them otiose. Legislative enactments with financial implications must be followed strictly. Authorities cannot usurp legal provisions for their convenience, causing hardship to assessees and confusion. Instructions and circulars can only supplement statutory provisions and aid in their implementation. Consequently, notices issued by the Jurisdictional Assessing Officer under Section 148 of the Act, 1961, and the proceedings initiated thereafter without conducting the faceless assessment as envisaged under Section 144B of the Act, 1961, were found to be contrary to the Act. The specific notices dated 28.02.2023, 16.03.2023, 20.03.2024, and 30.03.2023, and the order dated 30.03.2023, 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 operative direction was to set aside the impugned notices and proceedings. The issue of whether the revenue could follow the procedure if advised was left open for future action.

What were the facts?

The petitioner (assessee) challenged notices and orders issued by the Income Tax Officer (respondent/revenue) under Sections 148A(b), 148A(d), and 148 of the Income Tax Act, 1961. The petitioner argued that these actions were taken without conducting a faceless assessment as mandated by Section 144B of the Act. The revenue contended that the circulars or instructions issued by the Board could override statutory provisions. The High Court was considering the validity of these notices and proceedings. The assessment years are not explicitly stated in the provided text. The procedural history involves the issuance of notices and an order under Section 148A, followed by a notice under Section 148, which are now under challenge.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting a faceless assessment as envisaged under Section 144B of the Act, are contrary to the provisions of the Act, 1961? (Question of law and fact, concerning Sections 144B and 148). Assessee's Contention: The notices and proceedings were invalid because they bypassed the mandatory faceless assessment procedure under Section 144B. The petitioner relied on the High Court's decision in CWP No. 21509 of 2023 (Jasjit Singh vs. Union of India and others) and a Coordinate Bench's decision in CWP No. 15745 of 2024 (Jatinder Singh Bhangu vs. Union of India and others). Revenue's Contention: The revenue argued that circulars or instructions by the Board could override statutory provisions, suggesting a basis for not strictly adhering to Section 144B. The judgment does not explicitly name any specific circulars or authorities relied upon by the revenue, other than the general assertion about the power of the Board to issue instructions.

Which sections of the Income-tax Act were involved?

Section 144B,Section 148,Section 148A(b),Section 148A(d),Section 119,Section 120

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
CWP-14528-2023 (O&M) Page 1 of 3 227 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-14528-2023 (O&M) Date of Decision: 18.11.2024 . . . . Petitioner Vs. INCOME TAX OFFICER AND ANOTHER . . . . Respondents **** CORAM: HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON’BLE MR. JUSTICE SANJAY VASHISTH **** Present: Mr. Tarun, Advocate (through VC mode), for Mr. Salil Kapoor, Advocate, for the petitioner. for the respondents/Revenue. **** SANJEEV PRAKASH SHARMA, J.(Oral) 1. Both the counsel are ad idem that the issue involved in the present petition stands finally examined and concluded by this Court in CWP No.21509 of 2023 titled as Jasjit Singh vs. Union of India and others, decided on 29.07.2024, and by the Coordinate Bench in CWP No.15745 of 2024 titled as Jatinder Singh Bhangu vs. Union of India and others, decided on 19.07.2024. This Court in Jasjit Singh (supra) held as under: “16. We are in agreement with the view taken by the Coordinate Bench and hold that such circular or instructions by the Board could not have been issued to override statutory provisions or to make them otiose or obsolete. Legislative enactments having financial LAVISHA 2024.11.19 15:51 I attest to the accuracy and

authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

CWP-14528-2023 (O&M) implications are required to be followed strictly and mandatorily. By exercising the powers contained in Sections 119 and 120 of the Act, 1961 as well as Section 144B (7 & 8), the authorities cannot be allowed to usurp the legal provisions to their own satisfaction and convenience causing hardship to the assessees. It also leaves confusion in the minds of the taxpayers. In the opinion of this Court, instructions and circulars can be issued only for the purpose of supplementing the statutory provisions and for their implementation.

17.

In view of the aforesaid discussion, there is no occasion to distinguish or take a different view as suggested by the learned counsel for the revenue from what has already been held by the Coordinate Bench.

18.

Keeping in view the law laid down by the Coordinate Bench (supra), notices issued by the JAO under Section 148 of the Act, 1961 and the proceedings initiated thereafter without conducting the faceless assessment as envisaged under Section 144B of the Act, 1961, have been found to be contrary to the provisions of the Act, 1961 and accordingly notices dated 28.02.2023, 16.03.2023, 20.03.2024 and 30.03.2023 and order dated 30.03.2023, are set aside for want of jurisdiction.

19.

The respondents-revenue would be, however, at liberty to follow the procedure as laid down under the Act, 1961 and proceed accordingly, if so advised.

20.

All the writ petitions are allowed. The interim order passed by the Court shall stand merged with the present order.” LAVISHA 2024.11.19 15:51 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

CWP-14528-2023 (O&M)

2.

Keeping in view above, we allow this Writ Petition in the aforesaid terms. The observations and order passed above shall apply mutatis mutandis to the present case. Accordingly, order dated 31.03.2023 issued under Section 148A(d) of the Income Tax Act, 1961, and notice dated 11.03.2023 issued under Section 148A(b) of the Income Tax Act, 1961, and notice dated 31.03.2023 issued under Section 148 of the Income Tax Act, 1961, by Jurisdictional Assessing Officer as well as the consequential proceedings are set aside.

3.

All pending applications also stand disposed of accordingly.

(SANJEEV PRAKASH SHARMA) JUDGE (SANJAY VASHISTH) JUDGE November 18, 2024 Lavisha

1.

Whether speaking/reasoned? Yes/No 2. Whether reportable? Yes/No LAVISHA 2024.11.19 15:51 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

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