VIKAS PASSI vs. ITO WARD 7(1), LUDHIANA

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CWP/9416/2023HC Punjab & HaryanaPHHC01053212202305 November 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 notices issued 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, 1961, were contrary to the provisions of the Act, 1961. The Court found that instructions by the Board could not override statutory provisions or make them obsolete, and that legislative enactments must be followed mandatorily. The Court reasoned that allowing authorities to usurp legal provisions based on their own satisfaction and convenience would cause hardship and confusion. Therefore, the notices dated 13.04.2023, 28.02.2023, 20.03.2024, 16.03.2023, and 30.03.2023, along with consequential proceedings, were set aside for want of jurisdiction. The Revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly. The Court allowed the writ petition in terms, merging interim orders with the final order.

What were the facts?

The petitioner, Vikas Pass, challenged notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings before the Income Tax Officer (ITO), Ward 7(1), Ludhiana. The petitioner argued that these notices and proceedings were invalid. The Revenue contended that the notices were issued in accordance with the law. The High Court was considering these writ petitions, which were being disposed of in light of previous judgments by coordinate benches of the same court in similar matters.

What were the issues?

1. Whether notices issued 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, 1961, are liable to be set aside for want of jurisdiction. Assessee's Contention: The assessee argued that the notices and proceedings were invalid. The judgment indicates that the assessee's position was aligned with the findings in previous cases decided by the court, which held that circulars or instructions from the Board could not override statutory provisions or render them obsolete, and that legislative enactments must be followed mandatorily. The assessee's arguments implicitly relied on the principle that faceless assessment procedures under Section 144B are statutory and must be followed. Revenue's Contention: The Revenue's counsel argued that the notices were issued in accordance with the law. The judgment does not explicitly detail the Revenue's arguments beyond this general statement, but it notes that the Revenue's counsel suggested distinguishing the present case from previous judgments. The Revenue relied on instructions by the Board.

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-9416-202 122+242

IN TH VIKAS PASS ITO WARD 7

CORAM: H

H Present: M f

SANJEEV P

1.

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

SI Vs.

7(1), LUDHIANA **** HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN **** Mr. S.K. Mukhi, Advocate (throu for the petitioner. Mr. Ranvijay Singh, Sr. Standing 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-9416-2023 (O&M) Date of Decision: 05.11.2024 . . . . Petitioner . . . . Respondent NJEEV PRAKASH SHARMA NJAY VASHISTH ugh VC) g 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 t t P , P a ) MOHIT GOYAL 2024.11.05 16:35 I attest to the accuracy and integrity of this document

CWP-9416-202 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 3 (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 2024.11.05 16:35 I attest to the accuracy and integrity of this document

CWP-9416-202 i w 2. Keepin terms. mutand issued Jurisdic proceed 3. All pen

November 05, Mohit goyal 1. Whethe 2. Whethe 3 (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 13.04.2023 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 3 y l MOHIT GOYAL 2024.11.05 16:35 I attest to the accuracy and integrity of this document

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