GURUBACHAN PAL SINGH vs. INCOME TAX OFFICER

PDF · subscribers
CWP/22109/2024HC Punjab & HaryanaPHHC01116595202404 September 2024Bench: 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 make them obsolete. Such instructions, including those issued under Sections 119 and 120 of the Income Tax Act, 1961, and Section 144B(7) & (8), must be followed strictly and mandatorily. The authorities cannot use these powers to usurp legal provisions for their convenience, causing hardship to assessees and confusion. Instructions and circulars are meant to supplement statutory provisions and aid in their implementation. The Court found no reason to distinguish the present case from the precedents set by the Coordinate Bench. Consequently, notices issued by the JAO under Section 148 and subsequent proceedings, initiated without conducting faceless assessment as envisaged under Section 144B, were found to be contrary to the Act and were set aside for want of jurisdiction. The revenue was granted liberty to follow the prescribed procedure. The notices dated 23.03.2024 and all consequential proceedings were set aside.

What were the facts?

The petitioner, Gurubachan Pal Singh, filed a writ petition before the Punjab and Haryana High Court challenging notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, and consequential proceedings. The revenue, represented by the Income Tax Officer, accepted notice. The High Court noted that the substantial issue involved had been decided by a Coordinate Bench in similar cases, specifically Jasjit Singh vs. Union of India and others (decided on 29.07.2024) and Jatinder Singh Bhangu vs. Union of India and others (decided on 19.07.2024). The present petition was filed in 2024. The amount in dispute was not explicitly stated.

What were the issues?

1. Whether circulars or instructions issued by the Income Tax Board can override statutory provisions or render them obsolete, contrary to the mandatory requirements of Sections 119 and 120 of the Income Tax Act, 1961, and Section 144B(7) & (8) of the Act. Assessee's contention: The assessee relied on the decisions of the Coordinate Bench in Jasjit Singh and Jatinder Singh Bhangu, which held that circulars and instructions cannot override statutory provisions. The authorities cannot usurp legal provisions for their convenience, causing hardship and confusion to taxpayers. Instructions and circulars can only supplement statutory provisions. Revenue's contention: The revenue suggested that there might be grounds to distinguish the present case from the precedents relied upon by the Coordinate Bench.

Which sections of the Income-tax Act were involved?

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

AI-generated summary — verify with the full judgment below

114

I Gurubachan P

Income Tax O

CORAM: H

Present M

SANJEEV P 1.

N 2.

M behalf of the r 3.

L issue involved by this Court India and oth CWP No.1574 and others, de under: “ B c m f IN THE HIGH COURT OF PUN AT CHANDIGA C D Pal Singh

Vs. Officer

HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN Mr. Sunil K. Mukhi, Advocate fo ***

RAKASH SHARMA, J.(Oral) Notice of motion. Mr. Ranvijay Singh, Sr. Standi revenue. Learned counsel for the parties d in the present petition stands f in CWP No.21509 of 2023 title hers, decided on 29.07.2024, an 745 of 2024 titled as Jatinder Sin ecided on 19.07.2024. This Cour “16. We are in agreement with th Bench and hold that such circul could not have been issued to ove make them otiose or obsolete. financial implications are requi NJAB AND HARYANA ARH CWP- 22109-2024 (O&M) Date of Decision: 04.09.2024

…Petitioner

…Respondent NJEEV PRAKASH SHARMA NJAY VASHISTH or the petitioner.

) ing Counsel accepts notice on are ad idem that the substantial finally examined and concluded ed as Jasjit Singh vs. Union of nd by the Coordinate Bench in ngh Bhangu vs. Union of India rt in Jasjit Singh (supra) held as he view taken by the Coordinate lar or instructions by the Board erride statutory provisions or to Legislative enactments having ired to be followed strictly and n l d f n a s e d

g d RAJESH KUMAR 2024.09.06 13:04 I attest to the accuracy and authenticity of this order/judgment. Punjab & Haryana High Court, Chandigarh.

[2]

CWP- 22109-2024 (O&M)

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.”

RAJESH KUMAR 2024.09.06 13:04 I attest to the accuracy and authenticity of this order/judgment. Punjab & Haryana High Court, Chandigarh.

[3]

CWP- 22109-2024 (O&M)

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, notice issued by the Jurisdictional Assessing Officer under Section 148 dated 23.03.2024 and all consequential proceedings are set aside. 5.

All pending applications also stand disposed of accordingly.

(SANJEEV PRAKASH SHARMA) JUDGE

(SANJAY VASHISTH)

JUDGE 04.09.2024 rajesh 1. Whether speaking/reasoned? : Yes/No 2. Whether reportable?

: Yes/No

RAJESH KUMAR 2024.09.06 13:04 I attest to the accuracy and authenticity of this order/judgment. Punjab & Haryana High Court, Chandigarh.

More judgments on Section 119

All 707 judgments and leading authorities on Section 119 →

Recent GST High Court judgments

Search GST case law →