PUNEET VAID vs. INCOME TAX OFFICER AND OTHERS

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CWP/22853/2024HC Punjab & HaryanaPHHC01120160202409 September 2024Bench: 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 under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated under Section 144B of the Act, without conducting the faceless assessment as envisaged by the Act, were found to be contrary to the provisions of the Act. The Court relied on its previous decision in Jasjit Singh vs. Union of India and others, which held that circulars or instructions from the Board cannot override statutory provisions or make them obsolete. Legislative enactments with financial implications must be followed strictly. The Court found that the notices dated 14.03.2023, 20.03.2023, 23.03.2023, 16.03.2023, 30.03.2023, and 30.03.2023 were issued for want of jurisdiction. Consequently, the notices and all consequential proceedings, including the order passed by the Assessing Officer u/s 148 dated 14.03.2024 (Annexure P-1), were set aside. The revenue was granted liberty to follow the procedure as laid down under the Act and proceed accordingly, if so advised. All pending applications were also disposed of.

What were the facts?

The petitioners, represented by Mr. B.M. Monga and Mr. Rohit Kaura, filed a writ petition challenging notices issued by the Assessing Officer under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated under Section 144B. The revenue, represented by Mr. Yogesh Putney, accepted notice. The core of the dispute revolves around the validity of these notices and proceedings, particularly in light of faceless assessment procedures. The High Court noted that similar issues had been decided by a Coordinate Bench in previous cases, Jasjit Singh vs. Union of India and others (CWP No. 21509 of 2023) and Jatinder Singh Bhangu vs. Union of India and others (CWP No. 15745 of 2024).

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings under Section 144B of the Act, initiated without conducting the faceless assessment as envisaged by the Act, are valid and not contrary to the provisions of the Act and relevant circulars. (Mixed question of law and fact) Assessee's Contention: The assessee argued that the notices and subsequent proceedings were invalid because they were initiated without adhering to the faceless assessment procedures mandated by Section 144B of the Act. They relied on the principle that instructions by the Board cannot override statutory provisions and that legislative enactments with financial implications must be followed mandatorily. Revenue's Contention: The revenue, through the Senior Standing Counsel, accepted notice and did not present any arguments against the assessee's position, indicating an ad idem stance with the petitioner regarding the final examination of the issue.

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

154 IN TH PUNEET VAI

INCOME TA BHAWAN, SE

CORAM: H

H Present: M

M f

* SANJEEV PR

1.

N 2. M behalf of the r 3. B present petiti CWP No.215 decided on 29 2024 titled a decided on 19

C i o o i m HE HIGH COURT OF PUNJA CHANDIGAR

CWP-2 Date of ID

V AX OFFICER, ITO WARD 2(1 ECTOR-17, CHANDIGARH AND

HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ Mr. B.M. Monga, Advocate with Mr. Rohit Kaura, Advocate for th Mr. Yogesh Putney, Senior Stand for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Mr. Yogesh Putney, Senior Stan respondent-Income Tax Departm Both the counsel are ad idem ion stands finally examined an 509 of 2023 titled as Jasjit Singh 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 implications are required to be mandatorily. By exercising the AB AND HARYANA AT RH 22853-2024 (O&M) f Decision:09.09.2024

..…...Petitioners (s) V/s. 1), CHANDIGARH, AAYAKAR D OTHERS

......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH

h he petitioner. ding Counsel, Department nding Counsel accepts notice on ment that the issue involved in the nd concluded by this Court in h vs. 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 followed strictly and powers contained in R ) n e n , f , Suresh Kumar 2024.09.10 09:36 I attest to the accuracy and integrity of this document

CWP-22853-202

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 mutandis to th 024 (O&M) Page 2 of 3

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 he present case. Accordingly, no 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 otice issued by the Jurisdictional e s l Suresh Kumar 2024.09.10 09:36 I attest to the accuracy and integrity of this document

CWP-22853-202

Assessing O consequential 5. A

September 9, Ess Kay

Whether speak Whether Repor 024 (O&M) Page 3 of 3

Officer u/s 148 dated 14.03 l proceedings are set aside. All pending applications also stan [SANJEEV , 2024 [SAN

king / reasoned :

Y rtable

Y 3.2024 (Annexure P-1), and nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No d Suresh Kumar 2024.09.10 09:36 I attest to the accuracy and integrity of this document

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