SURJEET KAUR vs. INCOME TAX OFFICER AND OTHERS

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CWP/30897/2024HC Punjab & HaryanaPHHC01158729202418 November 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 render them otiose. Legislative enactments with financial implications must be strictly followed. The Court found that authorities cannot usurp legal provisions for their convenience, causing hardship to assessees and confusion. Instructions and circulars can only supplement statutory provisions and aid in their implementation. Applying the law laid down in previous judgments (Jasjit Singh and Jatinder Singh Bhangu), the Court ruled that notices issued by the JAO under Section 148 and proceedings initiated thereafter without conducting faceless assessment as envisaged under Section 144B are 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 respondents were granted liberty to follow the prescribed procedure if advised. The specific notice challenged in this petition, dated 28.03.2024, and all consequential proceedings were also set aside. The Court explicitly stated that the observations and order would apply mutatis mutandis to the present case.

What were the facts?

This case involves a writ petition filed by Surjeet Kaur (the petitioner) against the Income Tax Officer and others (the respondents). The petitioner challenged notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The core of the dispute revolves around whether these notices and proceedings were conducted in accordance with the faceless assessment scheme envisaged under Section 144B of the Act. The petitioner argued that the assessment was not conducted facelessly as mandated. The High Court noted that the issue was identical to those decided in previous writ petitions, specifically CWP No. 21509 of 2023 (Jasjit Singh vs. Union of India and others) and CWP No. 15745 of 2024 (Jatinder Singh Bhangu vs. Union of India and others).

What were the issues?

1. Whether notices issued by the JAO under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting faceless assessment as envisaged under Section 144B of the Act, are valid. Assessee's Contention: The assessee argued that the assessment proceedings were not conducted in accordance with the faceless assessment scheme mandated by Section 144B of the Income Tax Act, 1961, rendering the notices and subsequent actions invalid. Revenue's Contention: The revenue contended that the notices and proceedings were valid. However, the judgment indicates that the revenue's counsel accepted notice and did not present a distinct argument against the petitioner's case, instead agreeing that the substantial issue was already decided. The judgment does not record specific arguments from the revenue regarding the validity of the faceless assessment procedure in this particular instance.

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

132

Surjeet Kaur

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 IN THE HIGH COURT OF PUN AT CHANDIGA C D

Vs. Officer and others

HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN Mr. Nikhil Goyal, Advocate for t

*** RAKASH SHARMA, J.(Oral) Notice of motion. Mr. Yogesh Putney, 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 NJAB AND HARYANA ARH CWP-30897-2024 (O&M) Date of Decision: 18.11.2024 …Petitioner …Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH 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 n l d f n a s e d

RAJESH KUMAR 2024.11.19 10:57 I attest the accuracy and authenticity of this order/judgment.

[2] CWP-30897-2024 (O&M)

make them otiose or obsolete. Legislative enactments having financial implications are required to be followed strictly and 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. RAJESH KUMAR 2024.11.19 10:57 I attest the accuracy and authenticity of this order/judgment.

[3] CWP-30897-2024 (O&M)

20.

All the writ petitions are allowed. The interim order passed by the Court shall stand merged with the present order.”

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 of the Income Tax Act, dated 28.03.2024 and all consequential proceedings are set aside. 5.

All pending applications also stand disposed of accordingly.

(SANJEEV PRAKASH SHARMA) JUDGE

(SANJAY VASHISTH)

JUDGE 18.11.2024 rajesh 1. Whether speaking/reasoned? : Yes/No 2. Whether reportable?

: Yes/No RAJESH KUMAR 2024.11.19 10:57 I attest the accuracy and authenticity of this order/judgment.

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