RAKESH KUMAR vs. INCOME TAX OFFICER AND OTHERS

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CWP/23683/2024HC Punjab & HaryanaPHHC01124989202417 September 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
AI SummaryAllowed

What did the High Court hold?

The Tribunal held that notices issued under Section 148 of the Income Tax Act, 1961, and the consequential proceedings initiated under Section 144B, were without jurisdiction and contrary to the provisions of the Act. The reasoning was based on a prior decision by a Coordinate Bench in Jasjit Singh vs. Union of India and others, which held that circulars or instructions issued by the Board cannot override statutory provisions or render them obsolete. The Court emphasized that 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 and aid in their implementation. Consequently, the notices dated February 28, 2023, March 16, 2023, March 20, 2023, March 30, 2023, and August 31, 2024, were set aside. The Revenue was granted liberty to follow the prescribed procedure if advised. All pending applications were also disposed of.

What were the facts?

The petitioners, Rakesh Kumar and others, challenged notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings, including those under Section 144B, by the Income Tax Department. The assessment years are not explicitly stated, but the notices were dated between February 28, 2023, and March 30, 2023, with a further notice under Section 148 dated August 31, 2024. The core of the dispute revolves around the validity of these notices and the assessment proceedings initiated without adhering to the prescribed faceless assessment procedures. The petitioners argued that the notices and subsequent actions were without jurisdiction. The Revenue, represented by the Income Tax Department, accepted notice.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated under Section 144B, are valid when faceless assessment procedures, as envisaged by the Act, have not been followed. Assessee's Contention: The assessee argued that the notices and subsequent proceedings were without jurisdiction because the mandatory faceless assessment procedures were not followed. They relied on the principle that statutory provisions must be followed strictly. Revenue's Contention: The revenue did not present any arguments against the assessee's contentions. The judgment notes that the respondent-revenue accepted notice and that both counsel were ad idem, implying agreement with the assessee's position or the precedent cited.

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

118 IN TH RAKESH KUM

INCOME TA BHAWAN, JA

CORAM: H

Present: M

M M f

* SANJEEV PR

1.

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

C i o o i HE HIGH COURT OF PUNJA CHANDIGAR

CWP-2 Date of UMAR

V AX OFFICER, WARD 3, YA AGADHARI AND OTHERS HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ Mr. B.M. Monga, Advocate and Mr. Rohit Kaura, Advocate for th Mr. Saurabh Kapoor, Senior Stan Ms. Pridhi Sandhu Junior Standin for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Mr. Saurabh Kapoor, Senior St he respondent-Income Tax Depa 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 AB AND HARYANA AT RH 23683-2024 (O&M) f Decision:17.09.2024 ..…...Petitioners (s) V/s. YAMUNA NAGAR, AAYAKAR

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

he petitioner. nding Counsel, with ng Counsel, Department tanding Counsel, accepts notice artment 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 R e e n , f , Suresh Kumar 2024.09.18 09:30 I attest to the accuracy and integrity of this document

CWP-23683-202

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

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 he present case. Accordingly, no 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 otice issued by the Jurisdictional e s l Suresh Kumar 2024.09.18 09:30 I attest to the accuracy and integrity of this document

CWP-23683-202

Assessing O consequential 5. A

September 17 Ess Kay

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

Officer u/s 148 dated 31.08 l proceedings are set aside. All pending applications also stan [SANJEEV 7, 2024 [SAN

king / reasoned :

Y rtable

Y 8.2024 (Annexure P-1), and nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No d Suresh Kumar 2024.09.18 09:30 I attest to the accuracy and integrity of this document

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