ANIL SHARMA vs. INCOME TAX OFFICER AND OTHERS

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CWP/32229/2024HC Punjab & HaryanaPHHC01166622202417 December 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 it was in agreement with the view taken by the Coordinate Bench in previous cases (Jasjit Singh and Jatinder Singh Bhangu). The Court reiterated that instructions by the Board cannot override statutory provisions or render them obsolete, and legislative enactments must be followed mandatorily. The powers contained in Sections 119 and 120 of the Act, as well as Section 144B, cannot be exercised by tax authorities to usurp legal provisions for their own satisfaction and convenience, causing hardship and confusion to assessees. The Court found that notices issued under Section 148 of the Act, 1961, and proceedings initiated thereafter without conducting the faceless assessment as envisaged under Section 144B, were contrary to the provisions of the Act, 1961. Consequently, the notices dated 28.02.2023, 20.03.2024, 16.03.2023, 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, 1961, and proceed accordingly if advised. All interim orders and pending applications were disposed of.

What were the facts?

The petitioner, Anil Sharma, filed a writ petition before the High Court of Punjab and Haryana challenging notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The Revenue was represented by the Income Tax Officer and others. The Court noted that the issue involved in this petition had been finally examined and concluded in previous writ petitions, specifically CWP-509 of 2023 (Jasjit Singh vs. Union of India) decided on 29.07.2024, and CWP-157 of 2024 (Jatinder Singh Bhangu vs. Union of India) decided on 19.07.2024. These prior judgments had dealt with similar challenges to notices and proceedings initiated under Section 148 and conducted under Section 144B of the Act.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and proceedings initiated thereafter, including faceless assessment under Section 144B, were valid when found to be contrary to the provisions of the Act, 1961, and the instructions by the Board, particularly concerning the overriding effect of statutory provisions versus administrative instructions. Assessee's Contention: The assessee, through counsel, argued that the issue had been conclusively decided by this Court in prior judgments (Jasjit Singh and Jatinder Singh Bhangu). The core of the argument, as reflected in the prior judgments, was that administrative instructions or circulars from the Board cannot override statutory provisions or render them obsolete, and legislative enactments must be followed mandatorily. The powers under Sections 119 and 120, as well as Section 144B, cannot be exercised to usurp legal provisions for administrative convenience, causing hardship and confusion. Revenue's Contention: The learned counsel for the revenue suggested that there might be grounds to distinguish the present case or take a different view from the Coordinate Bench's prior decisions. However, the judgment does not elaborate on specific arguments presented by the revenue beyond this general suggestion.

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-32229-202 120 IN TH ANIL SHARM INCOME TA

CORAM: H

H Present: M

M M M f

SANJEEV P

1.

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

MA Vs.

AX OFFICER AND OTHERS **** HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN **** Mr. Kartik Bansal, Advocate for Mr. Saurabh Kapoor, Sr. Standin Ms. Pridhi Sandhu, Jr. Standing C Ms. Muskaan Gupta, Advocate 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 AB AND HARYANA AT RH CWP-32229-2024 (O&M) Date of Decision: 17.12.2024 . . . . Petitioner . . . . Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH the petitioner. ng Counsel with Counsel ) 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

) 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-32229-202 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 a t 24 (O&M) Page 2 of 3 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. 19. The respondents-reven at liberty to follow the procedur the Act, 1961 and proceed accord 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 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-32229-202 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 28.08.2024 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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