DEEPAK MANGLA vs. ASSISTANT COMMISSIONER OF INCOME TAX AND OTHERS

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CWP/32221/2024HC Punjab & HaryanaPHHC01166645202417 December 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 obsolete. It found that the authorities cannot usurp legal provisions for their convenience, causing hardship and confusion to assessees. The Court agreed with the Coordinate Bench's view that instructions can only supplement statutory provisions for implementation. Consequently, the Court held that notices issued under Section 148 of the Act, 1961, and proceedings initiated thereafter without conducting faceless assessment as envisaged under Section 144B of the Act, 1961, were contrary to the provisions of the Act. The notices dated 30.08.2024, 28.02.2023, 16.03.2023, 20.03.2024, 30.03.2023, and 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. All pending applications were also disposed of.

What were the facts?

The petitioners, Deepak Mangla and others, challenged notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The Revenue, represented by the Assistant Commissioner of Income Tax and others, issued these notices. The assessment years are not explicitly stated for all petitioners but implied to be subject to reassessment. The challenge is to the validity of the reassessment notices and the subsequent proceedings, particularly those conducted under the faceless assessment scheme. The High Court noted that the issue had been decided by a Coordinate Bench in similar writ petitions, Jasjit Singh vs. Union of India and others (CWP No. 215 of 2023) and Jatinder Singh Bhangu vs. Union of India (CWP No. 157 of 2024). The Court was informed that the present petitions were to be decided based on those prior judgments.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent faceless assessment proceedings initiated without complying with the prescribed procedure, are valid? 2. Whether circulars or instructions issued by the Board can override statutory provisions of the Income Tax Act, 1961? The Assessee contended that the reassessment notices and subsequent proceedings were invalid as they were contrary to the provisions of the Act and the principles of natural justice. They argued that the faceless assessment scheme, as implemented, usurped legal provisions and caused hardship. The Revenue, through its counsel, relied on the Coordinate Bench's decision in Jasjit Singh (supra) and Jatinder Singh Bhangu (supra), which held that instructions by the Board could not override statutory provisions. The Revenue did not present independent arguments but implicitly supported the outcome of the prior judgments.

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

CWP-32221-202 117 IN TH DEEPAK MA ASSISTANT

CORAM: H

H Present: M

SANJEEV P

1.

Both th petition No.215 decided No.157 and oth held as b i o 24 (O&M) Page 1 of 3 HE HIGH COURT OF PUNJA CHANDIGAR

ANGLA Vs.

COMMISSIONER OF INCOM **** HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN **** Mr. Nikhil Goyal, Advocate for t Mr. Yogesh Putney, Sr. Standing Mr. Vaibhav Gupta, Standing Co for the respondents/Revenue. **** RAKASH SHARMA, J.(Oral) 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: “16. We are in agreemen by the Coordinate Bench and hol nstructions by the Board could n override statutory provisions or t AB AND HARYANA AT RH CWP-32221-2024 (O&M) Date of Decision: 17.12.2024 . . . . Petitioner ME TAX AND OTHERS . . . . Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH the petitioner. g Counsel with ounsel ) 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) nt with the view taken ld that such circular or not have been issued to to make them otiose or

) 4 r s t P , P a ) MOHIT GOYAL 2024.12.18 11:44 I attest to the accuracy and integrity of this document

CWP-32221-202 o i m S S a s a t a s i n s w C u i a A p d 3 f a t 24 (O&M) Page 2 of 3 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. 19. The respondents-reven at liberty to follow the procedur the Act, 1961 and proceed accord 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 nue would be, however, re as laid down under dingly, if so advised.

MOHIT GOYAL 2024.12.18 11:44 I attest to the accuracy and integrity of this document

CWP-32221-202 i w 2. Keepin terms. mutand issued Jurisdic proceed 3. All pen

December 17, Mohit goyal 1. Whethe 2. Whethe 24 (O&M) Page 3 of 3 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 2024 r speaking/reasoned?

Y r reportable?

Y ns are allowed. The urt shall stand merged s Writ Petition in the aforesaid assed above shall apply mutatis dingly, notice dated 30.08.2024 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 2024.12.18 11:44 I attest to the accuracy and integrity of this document

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