KUNAL SOBTI vs. INCOME TAX OFFICER AND OTHERS

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CWP/23843/2024HC Punjab & HaryanaPHHC01124655202418 September 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 Assessing Officer under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated without conducting the mandatory faceless assessment as envisaged under Section 144B of the Act, 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 Jatinder Singh Bhangu vs. Union of India. It reiterated that instructions by the Board (circulars) cannot override statutory provisions or make them otiose. The Court emphasized that legislative enactments having financial implications must be mandatorily followed, and authorities cannot usurp legal provisions for their convenience or satisfaction, causing hardship and confusion to assessees. Consequently, the notices dated February 28, 2023, March 16, 2023, March 20, 2023, March 30, 2023, and the notice dated March 27, 2024, were set aside for want of jurisdiction. The Revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly if so advised. The operative direction was to allow the writ petition and set aside the impugned notices and consequential proceedings.

What were the facts?

The petitioner, Kunal Sobt, challenged notices issued by the Assessing Officer under Section 148 of the Income Tax Act, 1961, dated March 27, 2024, and consequential proceedings. The assessment year(s) are not explicitly stated but are implied to be related to reassessment proceedings. The petitioner argued that the notices and subsequent proceedings were invalid. The Revenue, represented by the Income Tax Department, accepted notice. The High Court noted that similar issues had been decided by coordinate benches in previous cases, specifically Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India, both decided on July 9, 2024. The core of the dispute revolves around the validity of reassessment notices issued under faceless assessment procedures.

What were the issues?

1. Whether notices issued by the Assessing Officer under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated under the faceless assessment regime, are valid when they allegedly do not comply with statutory provisions and established procedures? (Mixed question of law and fact, concerning Section 148 and Section 144B of the Income Tax Act, 1961). Assessee's Contention: The petitioner argued that the notices and subsequent proceedings were invalid. The judgment does not explicitly detail the specific arguments of the petitioner beyond this general assertion, but it implies a challenge to the jurisdiction and procedure followed. Revenue's Contention: The Revenue, through its counsel, accepted notice. The judgment does not record any specific arguments made by the Revenue in defense of the notices or proceedings. However, the court's decision references prior judgments where similar issues were decided, suggesting the Revenue may have relied on existing departmental instructions or interpretations that were found to be contrary to law in those precedents.

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

131 IN TH KUNAL SOBT

INCOME TAX

CORAM: H

H

Present: M f 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 HE HIGH COURT OF PUNJA CHANDIGAR

CWP-2 Date of TI

V X OFFICER, WARD-2, AMBALA

HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ

Mr. Nikhil Goyal, Advocate for the petitioner. Mr. Saurabh Kapoor, Senior Stan Ms. Pridhi Sandhu, Advocate for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Mr. Saurabh Kapoor, Senior St 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 AB AND HARYANA AT RH 23843-2024 (O&M) f Decision:18.09.2024

..…...Petitioners (s) V/s. A, HARYANA AND OTHERS …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH

nding Counsel, with Department. tanding 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 e P , f , Suresh Kumar 2024.09.19 10:38 I attest to the accuracy and integrity of this document

CWP-23843-202

i m 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 024 (O&M) implications are required to be mandatorily. By exercising the 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

18.

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.

19.

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

20.

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 e followed strictly and powers contained in 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 e s Suresh Kumar 2024.09.19 10:38 I attest to the accuracy and integrity of this document

CWP-23843-202

mutandis to Jurisdictional and conseque

5.

A

September 18 Ess Kay

Whether speak Whether Repor 024 (O&M) the present case. Accordin Assessing Officer u/s 148 dat ntial proceedings are set aside. All pending applications also stan [SANJEEV 8, 2024 [SAN

king / reasoned :

Y rtable

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Y gly, notice(s) issued by the ted 27.03.2024 (Annexure P-5) nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No e ) Suresh Kumar 2024.09.19 10:38 I attest to the accuracy and integrity of this document

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