ANUJ BANSAL vs. INCOME TAX OFFICER AND OTEHRS

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CWP/18529/2024HC Punjab & HaryanaPHHC01100191202405 August 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
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What did the High Court hold?

The Tribunal, agreeing with the view taken by a Coordinate Bench, held that instructions or circulars issued by the Board could not override statutory provisions or render them otiose. Legislative enactments having financial implications must be followed strictly and mandatorily. The authorities cannot usurp legal provisions to their own satisfaction and convenience, causing hardship to assessees and confusion in taxpayers' minds. Instructions and circulars can only supplement statutory provisions for their implementation. Consequently, notices issued by the JAO under Section 148 of the Act, 1961, and proceedings initiated thereafter without conducting faceless assessments as envisaged under Section 144B of the Act, 1961, were found to be contrary to the provisions of the Act. The notices dated 28.02.2023, 16.03.2023, 20.03.2023, 24.03.2023, and 30.03.2023, along with the order dated 30.03.2023, were set aside for want of jurisdiction. The revenue was at liberty to follow the procedure laid down under the Act, 1961, and proceed accordingly. The writ petitions were allowed, and interim orders stood merged with the present order.

What were the facts?

The petitioners, Anuj Bansa and others, filed writ petitions challenging notices and proceedings initiated under Section 148 of the Income Tax Act, 1961, and subsequent actions taken without conducting faceless assessments as envisaged under Section 144B. The core issue revolved around the validity of notices and proceedings conducted in contravention of the faceless assessment scheme. The petitioners argued that the Assessing Officer (AO) had acted beyond their jurisdiction by deviating from the mandatory procedures. The revenue, represented by the Senior Standing Counsel, accepted notice and acknowledged that the issue was finally adjudicated by the High Court in a lead case. The High Court had previously held the AO's action as unjustified.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings conducted without adhering to the faceless assessment scheme under Section 144B of the Act, 1961, are valid. Assessee's Contention: The assessee argued that the Assessing Officer (AO) had usurped legal provisions to their own satisfaction and convenience, causing hardship and confusion, and that instructions and circulars can only supplement statutory provisions, not override them. They relied on the principle that legislative enactments with financial implications must be followed strictly and mandatorily. Revenue's Contention: The revenue's counsel accepted notice and acknowledged that the issue was already adjudicated by a Coordinate Bench of the High Court, implying agreement with the assessee's position.

Which sections of the Income-tax Act were involved?

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

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124

IN TH ANUJ BANSA

INCOME TAX

CORAM: H

Present: M

M f

* SANJEEV PR

1.

N 2. M on behalf of th 3. L raised in thes Court vide or lead case is C Others, wher Assessing Off 4. T “1 1 HE HIGH COURT OF PUNJA CHANDIGAR

CWP-1 Date of AL

V X OFFICER, WARD-1, KAITHA HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ Mr. B.M. Monga, Advocate, with Mr. Rohit Kaura, Advocate and Mr. Rajiv Sharma, Advocate for Ms. Gauri Neo Rampal, Senior S for the respondents. ***** RAKASH SHARMA, J. (Oral) Notice of motion. Ms. Gauri Neo Rampal, Senior S he respondents. Learned counsel for both the si se connected Writ Petitions sta rder dated 29.07.2024 in a bunch CWP-21509-2023 titled as Jasjit reby this Court has held the not ficer as unjustified. The Court has passed the followi 14 xxx xxx xxx xxx 15 xxx xxx xxx xxxx AB AND HARYANA AT RH 18529-2024 (O&M) f Decision:05.08.2024

..…...Petitioners (s) V/s. AL AND OTHERS …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH h the petitioner. Standing Counsel, Standing Counsel, accepts notice ides are ad idem that the issue ands finally adjudicated by this h of Writ Petitions in which the t Singh Vs. Union of India and tice issued by the jurisdictional ing order:- ) e e s e d l Suresh Kumar 2024.08.09 14:50 I attest to the accuracy and integrity of this document

CWP-18529-2024

1 C t p e f c S t c m a s i 1 t l b 1 B t c 1 p 2 d 4 (O&M) Page 2 of 3

16.

We are in agreement wi Coordinate Bench and hold that su the Board could not have been provisions or to make them otio enactments having financial impl followed strictly and mandatorily contained in Sections 119 and 120 Section 144B (7 & 8), the authoritie the legal provisions to their own causing hardship to the assessees. I minds of the taxpayers. In the opin and circulars can be issued supplementing the statutory p mplementation. 17. In view of the aforesaid dis to distinguish or take a differen earned counsel for the revenue fro by the Coordinate Bench. 18. Keeping in view the law la Bench (supra), notices issued by th the Act, 1961 and the proceeding conducting the faceless assessmen 144B of the Act, 1961, have been provisions of the Act, 1961 and 28.02.2023, 16.03.2023, 20.03.202 dated 30.03.2023, are set aside for ith the view taken by the uch circular or instructions by issued to override statutory ose or obsolete. Legislative lications are required to be y. By exercising the powers 0 of the Act, 1961 as well as es cannot be allowed to usurp satisfaction and convenience It also leaves confusion in the ion of this Court, instructions only for the purpose of provisions and for their scussion, there is no occasion nt view as suggested by the m what has already been held aid down by the Coordinate he JAO under Section 148 of gs initiated thereafter without t as envisaged under Section n found to be contrary to the d accordingly notices dated 24 and 30.03.2023 and order want of jurisdiction. Suresh Kumar 2024.08.09 14:50 I attest to the accuracy and integrity of this document

CWP-18529-2024

1 f p 2 p 2 2

5.

I terms. The ob to the presen Section 148 o 6. P

August 5, 202 Ess Kay

Whether speak Whether Repor

4 (O&M) Page 3 of 3

19.

The respondents-revenue wo follow the procedure as laid dow proceed accordingly, if so advised. 20. All the writ petitions are passed by the Court shall stand mer 21. xxx xxx xxxx 22. xxx xxx xxxx” In view of the above, we allow th bservations and order passed abo nt case. Accordingly, notice d of the Income Tax Act, is set asid Pending applications, if any, shal [SANJEEV 24 [SAN

king / reasoned :

Y rtable

Y ould be, however, at liberty to wn under the Act, 1961 and allowed. The interim order rged with the present order. his Writ Petition in the aforesaid ove shall apply mutatis mutandis dated 26.03.2024, issued under de. ll stand disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No d s r

Suresh Kumar 2024.08.09 14:50 I attest to the accuracy and integrity of this document

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