AXENO CONSULTING PRIVATE LIMITED vs. DEPUTY COMMISSIONER OF INCOME TAX AND ANR

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CWP/13339/2024HC Punjab & HaryanaPHHC01075020202411 December 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
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What did the High Court hold?

The Tribunal held that circulars or instructions issued by the Board cannot override statutory provisions or make them otiose. Legislative enactments with financial implications must be followed strictly and mandatorily. The authorities cannot usurp legal provisions for their convenience or satisfaction, causing hardship and confusion to assessees. Instructions and circulars can only supplement statutory provisions for their implementation. Therefore, the Court found no occasion to distinguish the present case from the Coordinate Bench's decisions in Jasjit Singh and Jatinder Singh Bhangu. Consequently, notices issued by the Jurisdictional Assessing Officer under Section 148 of the Act, 1961, and the consequential proceedings, including faceless assessments under Section 144B, were found to be contrary to the provisions of the Act, 1961. The notices dated 13.04.2023, 28.02.2023, 16.03.2023, 20.03.2024, and 30.03.2023, along with the consequential proceedings, were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act, 1961, if advised.

What were the facts?

The petitioner, AXENO CONSULTING PRIVATE LIMITED, filed a writ petition (CWP-13339-2024) challenging notices issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings. The petitioner sought preponement of the hearing, which was allowed. The Court noted that the issue was identical to previously decided cases: CWP No. 215509 of 2023 (Jasjit Singh vs. Union of India and others) decided on 29.07.2024, and CWP No. 157745 of 2024 (Jatinder Singh Bhangu vs. Union of India and others) decided on 19.07.2024. The revenue was represented by the Deputy Commissioner of Income Tax. The specific assessment year(s) and the amount in dispute are not explicitly stated in the provided text.

What were the issues?

1. Whether circulars or instructions issued by the Board can override statutory provisions or render them obsolete, particularly concerning faceless assessment proceedings under Section 144B of the Income Tax Act, 1961? (Question of law) Assessee's Contention: The petitioner, by relying on the judgments in Jasjit Singh and Jatinder Singh Bhangu, implicitly argued that the notices and proceedings were invalid if they violated statutory provisions or were issued contrary to binding circulars. The petitioner's counsel sought to have the present case decided in line with these precedents. Revenue's Contention: The revenue's counsel, Ms. Pridhi Sandhu, argued that the issue should be distinguished or taken differently from the Coordinate Bench's decisions. However, the judgment does not elaborate on the specific grounds for this distinction or the authorities relied upon by the revenue.

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

CWP-13339-202 114 IN TH AXENO CON DEPUTY CO CORAM: H

H Present: M

f SANJEEV P

1.

Applica seeking 2. For the case is 3. Both t petition No.215 decided No.157 and oth held as 24 (O&M) Page 1 of 3 HE HIGH COURT OF PUNJA CHANDIGAR

CM-19684-CWP-2024 & NSULTING PRIVATE LIMITED Vs.

OMMISSIONER OF INCOME T **** HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN **** Mr. Deepak Agrawal, Advocate f Ms. Pridhi Sandhu, Standing Cou for the respondents/Revenue. **** RAKASH SHARMA, J.(Oral) ation No.CM-19684-CWP-2024 g preponement of the main case. e reasons stated in the applicati preponed and taken up today itse the counsel are ad idem that th n stands finally examined and co 509 of 2023 titled as Jasjit Singh d on 29.07.2024, and by the 745 of 2024 titled as Jatinder Sin hers, decided on 19.07.2024. Th under: AB AND HARYANA AT RH & CM-19685-CWP-2024 in/and CWP-13339-2024 (O&M) Date of Decision: 11.12.2024 D . . . . Petitioner TAX AND ANOTHER . . . . Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH for the petitioner. unsel ) 4 has been filed by the petitioner ion, the same is allowed. Main elf. he issue involved in the present oncluded by this Court in CWP h vs. Union of India and others, e Coordinate Bench in CWP ngh Bhangu vs. Union of India his Court in Jasjit Singh (supra)

d ) 4 r s r n t P , P a ) MOHIT GOYAL 2024.12.11 17:44 I attest to the accuracy and integrity of this document

CWP-13339-202 b i o o i m S S a s a t a s i n s w C u i a A p d 3 f 24 (O&M) Page 2 of 3 “16. We are in agreemen by the Coordinate Bench and hol nstructions by the Board could n override statutory provisions or t obsolete. Legislative enactmen mplications 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 mplementation. 17. In view of the aforesa no occasion to distinguish or ta suggested by the learned counse what has already been held by th 18. Keeping in view the Coordinate Bench (supra), notic under Section 148 of the Act, 196 nitiated thereafter without con assessment as envisaged under Act, 1961, have been found to provisions of the Act, 1961 an dated 28.02.2023, 16.03.202 30.03.2023 and order dated 30. for want of jurisdiction. nt with the view taken ld that such circular or not have been issued to to make them otiose or nts having financial 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 aid discussion, there is ake a different view as el for the revenue from he Coordinate Bench. law laid down by the ces issued by the JAO 61 and the proceedings nducting the faceless r Section 144B of the o be contrary to the d accordingly notices 23, 20.03.2024 and 03.2023, are set aside

MOHIT GOYAL 2024.12.11 17:44 I attest to the accuracy and integrity of this document

CWP-13339-202 a t i w 4. Keepin terms. mutand issued Jurisdic proceed 5. All pen

December 11, Mohit goyal 1. Whethe 2. Whethe 24 (O&M) Page 3 of 3 19. The respondents-reven at liberty to follow the procedur the Act, 1961 and proceed accord 20. All the writ petition nterim order passed by the Cou with the present order.”

ng in view above, we allow this The observations and order pa dis to the present case. Accord under Section 148 of the ctional Assessing Officer as dings are set aside. nding applications also stand disp

(SANJ 2024 r speaking/reasoned?

Y r reportable?

Y nue would be, however, re as laid down under dingly, if so advised. ns are allowed. The urt shall stand merged s Writ Petition in the aforesaid assed above shall apply mutatis dingly, notice dated 13.04.2023 Income Tax Act, 1961 by s well as the consequential posed of accordingly. JEEV PRAKASH SHARMA) JUDGE

(SANJAY VASHISTH) JUDGE Yes/No Yes/No

d s 3 y l MOHIT GOYAL 2024.12.11 17:44 I attest to the accuracy and integrity of this document

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