VANDANA SETH vs. INCOME TAX OFFICER AND OTHERS

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CWP/24028/2024HC Punjab & HaryanaPHHC01125217202419 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, in agreement with a Coordinate Bench's view in similar cases (Jasjit Singh vs. Union of India and others, CWP-21509 of 2023, decided on 19.07.2024, and Jatinder Singh Bhangu vs. Union of India and others, CWP-15745 of 2024, decided on 19.07.2024), held that circulars and instructions issued by the Board cannot override statutory provisions. The Court found that notices issued by the Joint Administrative Officer (JAO) under Section 148 of the Act and subsequent proceedings initiated without conducting the assessment as envisaged under Section 144B were contrary to the provisions of the Act. Consequently, the notices dated 28.02.2023, 16.03.2023, 20.03.2024, and 30.03.2023, along with the order dated 30.03.2023, were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly if advised. The writ petition was allowed, and all pending applications were disposed of.

What were the facts?

The petitioners, represented by Mr. Nikhil Goyal, Advocate, filed a writ petition before the High Court of Punjab and Haryana at Chandigarh. The respondents were the Income Tax Officer Ward 4(1), Ludhiana, and others. The petition challenged notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated under faceless assessment as envisaged by Section 144B of the Act. The assessment years in question were not explicitly stated, but the notices were dated 28.02.2023, 16.03.2023, 20.03.2024, and 30.03.2023, with an order dated 30.03.2023. The High Court noted that the issue was identical to previous cases decided by a Coordinate Bench.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent faceless assessment proceedings under Section 144B of the Act, are valid when they are found to be contrary to the provisions of the Act and its circulars, and potentially override statutory provisions or make them obsolete. Assessee's Contention: The assessee argued, through the High Court's reference to previous judgments, that instructions by the Board (circulars) cannot override statutory provisions. They contended that legislative enactments having financial implications must be followed strictly. They also argued that authorities cannot usurp legal provisions for their own satisfaction or convenience, causing hardship and confusion to assessees. The High Court's previous decisions indicated that circulars and instructions can only supplement statutory provisions for implementation. Revenue's Contention: The revenue, represented by Senior Standing Counsel Mr. Ranvijay Singh and Ms. Urvashi Dhugga, accepted notice. No specific arguments for the revenue were recorded in the provided text, other than their counsel appearing and accepting notice.

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

131

IN TH VANDANA SE

INCOME TAX

CORAM: H

Present: M

M f

* SANJEEV PR

1.

N 2. M Dhugga, Seni No.1 and 2 re 3. B present petitio No.21509 of decided on 29 2024 titled a decided on 19

C HE HIGH COURT OF PUNJA CHANDIGAR

CWP-2 Date of ETH

V X OFFICER WARD 4(1), LUDH

HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ

Mr. Nikhil Goyal, Advocate for t Mr. Ranvijay Singh, Senior Stand for the respondent No.1. Ms. Urvashi Dhugga, Senior Stan Ms. Samdisha Kaur, Advocate for the respondent No.2/Income T ***** RAKASH SHARMA, J. (Oral) Notice of motion. Mr. Ranvijay Singh, Senior Stan ior Standing counsel, accept n espectively. Both the counsel are ad idem on stands finally examined and c f 2023 titled as Jasjit Singh vs 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 AB AND HARYANA AT RH 24028-2024 (O&M) f Decision:19.09.2024

..…...Petitioners (s) V/s. HIANA, PUNJAB AND OTHERS

…......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH the petitioner. ding Counsel, nding Counsel, with Tax Department. nding Counsel and Ms. Urvashi notice on behalf of respondents that the issue involved in the concluded by this Court in CWP s. 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 S ) i s e P , f , Suresh Kumar 2024.09.20 17:03 I attest to the accuracy and integrity of this document

CWP-24028-202

i o o i 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 024 (O&M) Page 2 of 3

instructions by the Board could n override statutory provisions or obsolete. Legislative enactmen implications 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 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.”

not have been issued to to make them otiose or nts having financial e 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 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 Suresh Kumar 2024.09.20 17:03 I attest to the accuracy and integrity of this document

CWP-24028-202

4.

K aforesaid term mutandis to Jurisdictional dated 28.03.2 5. A

September 19 Ess Kay

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

Keeping in view above, we a ms. The observations and order p the present case. Accordin Assessing Officer and all con 024 (Annexure P-1) are set aside All pending applications also stan [SANJEEV 9, 2024 [SAN

king / reasoned :

Y rtable

allow this Writ Petition in the passed above shall apply mutatis ngly, notices issued by the nsequential proceedings u/s 148 e. nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No e s e 8 Suresh Kumar 2024.09.20 17:03 I attest to the accuracy and integrity of this document

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