MEGHA GUPTA vs. INCOME TAX OFFICER AND OTHERS

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CWP/28338/2024HC Punjab & HaryanaPHHC01142903202419 October 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 circulars or instructions issued by the Board under Section 119 and Section 120 of the Income Tax Act, 1961, cannot override statutory provisions or render them otiose. Legislative enactments must be followed strictly. The Court found that the authorities, by exercising powers contained in Sections 119 and 120, as well as Section 144B (7 & 8), were attempting to usurp statutory provisions for their convenience, causing hardship and confusion to assessees. Instructions can only supplement statutory provisions for their implementation. Consequently, notices issued under Section 148 of the Act and proceedings conducted under Section 144B, including faceless assessments, were found to be contrary to the provisions of the Act. The Court specifically set aside notices dated 28.02.2023, 20.03.2024, 16.03.2023, and 30.03.2023, and the consequential proceedings for want of jurisdiction. The Revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly if advised. All pending applications were also disposed of.

What were the facts?

The petitioner, Megha Gupta, filed a writ petition before the High Court of Punjab and Haryana at Chandigarh. The respondents were the Income Tax Officer and others. The core of the dispute involved notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings conducted under Section 144B of the Act, which pertains to faceless assessments. The petitioner challenged the validity of these notices and proceedings. The High Court noted that similar issues had been decided by coordinate benches in other writ petitions, specifically CWP No. 509 of 2023 (Jasjit Singh vs. Union of India) decided on 29.07.2024, and CWP No. 157 of 2024 (Jatinder Singh Bhangu vs. Union of India) decided on 19.07.2024. The Revenue did not dispute that the present petition could be decided based on these prior judgments.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and proceedings conducted under Section 144B of the Act, specifically faceless assessments, were valid, considering the instructions issued by the Board and the statutory provisions. The Assessee argued that the notices and proceedings were contrary to the Act and prior judgments of the Court. The Revenue, represented by the Sr. Standing Counsel, accepted notice and did not contest the matter, agreeing that the issue had been finally examined and concluded by prior decisions of the High Court. The Revenue did not present any separate arguments or rely on any specific authorities, circulars, or precedents, implicitly accepting the findings in the previously decided cases.

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

CWP-28338-202 143 IN TH MEGHA GUP INCOME TA

CORAM: H

H Present: M

SANJEEV P

1.

Notice 2. Mr. Va respond 3. Both th petition No.215 decided No.157 and oth held as 24 (O&M) Page 1 of 3 HE HIGH COURT OF PUNJA CHANDIGAR

PTA Vs.

AX OFFICER AND OTHERS **** HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN **** Mr. Nikhil Goyal, Advocate for t Mr. Varun Issar, Sr. Standing Co for the respondents/Revenue. **** RAKASH SHARMA, J.(Oral) of motion. arun Issar, Sr. Standing Couns dents/Revenue. he counsel are ad idem that the n stands finally examined and co 509 of 2023 titled as Jasjit Singh d on 29.07.2024, and by the 745 of 2024 titled as Jatinder Sin hers, decided on 19.07.2024. Th under: AB AND HARYANA AT RH CWP-28338-2024 (O&M) Date of Decision: 19.10.2024 . . . . Petitioner . . . . Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH the petitioner. ounsel ) sel accepts notice on behalf of e issue involved in the present oncluded by this Court in CWP h vs. Union of India and others, e Coordinate Bench in CWP ngh Bhangu vs. Union of India his Court in Jasjit Singh (supra)

) 4 r s f t P , P a ) MOHIT GOYAL 2024.10.22 09:49 I attest to the accuracy and integrity of this document

CWP-28338-202 b i o o i m S S a s a t a s i n s w C u i a A p d 3 f 24 (O&M) Page 2 of 3 “16. We are in agreemen by the Coordinate Bench and hol nstructions by the Board could n override statutory provisions or t obsolete. Legislative enactmen mplications 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 mplementation. 17. In view of the aforesa no occasion to distinguish or ta suggested by the learned counse what has already been held by th 18. Keeping in view the Coordinate Bench (supra), notic under Section 148 of the Act, 196 nitiated thereafter without con assessment as envisaged under Act, 1961, have been found to provisions of the Act, 1961 an dated 28.02.2023, 16.03.202 30.03.2023 and order dated 30. for want of jurisdiction. nt with the view taken ld that such circular or not have been issued to to make them otiose or nts having financial 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 aid discussion, there is ake a different view as el for the revenue from he Coordinate Bench. law laid down by the ces issued by the JAO 61 and the proceedings nducting the faceless r Section 144B of the o be contrary to the d accordingly notices 23, 20.03.2024 and 03.2023, are set aside

MOHIT GOYAL 2024.10.22 09:49 I attest to the accuracy and integrity of this document

CWP-28338-202 a t i w 4. Keepin terms. mutand issued Jurisdic proceed 5. All pen

October 19, 20 Mohit goyal 1. Whethe 2. Whethe 24 (O&M) Page 3 of 3 19. The respondents-reven at liberty to follow the procedur the Act, 1961 and proceed accord 20. All the writ petition nterim order passed by the Cou with the present order.”

ng in view above, we allow this The observations and order pa dis to the present case. Accord under Section 148 of the ctional Assessing Officer as dings are set aside. nding applications also stand disp

(SANJ 024 r speaking/reasoned?

Y r reportable?

Y nue would be, however, re as laid down under dingly, if so advised. ns are allowed. The urt shall stand merged s Writ Petition in the aforesaid assed above shall apply mutatis dingly, notice dated 30.03.2024 Income Tax Act, 1961 by s well as the consequential posed of accordingly. JEEV PRAKASH SHARMA) JUDGE

(SANJAY VASHISTH) JUDGE Yes/No Yes/No

d s 4 y l MOHIT GOYAL 2024.10.22 09:49 I attest to the accuracy and integrity of this document

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