PARAMHANS BUILDWEL PRIVATE LIMITED vs. ASSISTANT COMMISSIONER OF INCOME TAX AND OTHERS

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CWP/11680/2025HC Punjab & HaryanaPHHC01064524202529 April 2025Author: MR. JUSTICE SANJEEV PRAKASH SHARMA,MRS. JUSTICE MEENAKSHI I. MEHTA3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition. The Court reiterated its previous findings in Jasjit Singh and Jatinder Singh Bhangu, holding that circulars or instructions issued by the Board cannot override statutory provisions or render them obsolete. Legislative enactments with financial implications must be strictly followed. The Court found that by exercising powers under Sections 119 and 120, and Section 144B (7 & 8), authorities cannot usurp legal provisions for their convenience, causing hardship. Instructions and circulars can only supplement statutory provisions. Consequently, notices issued by the JAO under Section 148 and subsequent proceedings, initiated without conducting the faceless assessment as envisaged under Section 144B, were found to be contrary to the Act and set aside for want of jurisdiction. The revenue was granted liberty to follow the prescribed procedure if advised. The present notice dated 22.03.2025 under Section 148 and consequential proceedings were set aside.

What were the facts?

The petitioner, Paramhans Buildwel Private Limited, filed a writ petition before the High Court of Punjab & Haryana at Chandigarh. The petition challenged a notice dated 22.03.2025 issued by the Assistant Commissioner of Income Tax, Central Circle – 1, Faridabad, under Section 148 of the Income Tax Act, 1961, and all consequential proceedings. The respondents, the Income Tax Department, accepted notice. Both parties agreed that the issue was concluded by previous judgments of the High Court in CWP No.21509 of 2023 (Jasjit Singh Versus Union of India and others) decided on 29.07.2024, and CWP No.15745 of 2024 (Jatinder Singh Bhangu Versus Union of India and others) decided on 19.07.2024. The High Court had previously ruled on the validity of notices issued under Section 148 without conducting faceless assessments as envisaged under Section 144B.

What were the issues?

1. Whether notices issued by the Joint Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, and subsequent proceedings are valid if a faceless assessment, as envisaged under Section 144B of the Act, 1961, was not conducted? (Question of law and mixed fact and law, turning on Section 148 and Section 144B). Assessee's Contention: The assessee, by implication through the petition and reliance on prior judgments, argued that notices issued under Section 148 and subsequent proceedings are invalid if the mandatory faceless assessment procedure under Section 144B was not followed. They relied on the High Court's decisions in Jasjit Singh and Jatinder Singh Bhangu. Revenue's Contention: The revenue, by accepting notice and not opposing the petition based on the precedent, implicitly conceded that the issue was covered by the prior judgments. They did not present any arguments to distinguish the present case from the established precedents.

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

Cause title — parties, addresses and appearances
137 IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH CWP No.11680 of 2025 Date of Decision: 29.04.2025 Paramhans Buildwel Private Limited …..Petitioner. Versus Assistant Commissioner of Income Tax, Central Circle – 1 Faridabad and others .....Respondents. CORAM: HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON’BLE MRS. JUSTICE MEENAKSHI I. MEHTA ***** Present:- Ms. Kajal Garg, Advocate for Mr. Nikhil Goyal, Advocate for the petitioner. SANJEEV PRAKASH SHARMA, J.(Oral) 1. Notice of motion. 2. Mr. Yogesh Putney, Senior Standing Counsel and Mr. Vaibhav Gupta, Standing Counsel, accept notice on behalf of the respondent(s)- Income Tax Department. 3. Both the counsel are ad-idem that the issue involved in the present petition stands finally examined and concluded by this Court in CWP No.21509 of 2023 titled as “Jasjit Singh Versus Union of India and others”, decided on 29.07.2024 and by the Co-ordinate Bench in CWP No.15745 of 2024 titled as “Jatinder Singh Bhangu Versus Union of India and others”, decided on 19.07.2024. This Court in Jasjit Singh’s YAG DUTT 2025.05.02 13:18 I attest to the accuracy and authenticity of this

order/judgment

CWP No.11680 of 2025 -2-

case (supra) held as under:- “16. We are in agreement with the view taken by the Coordinate Bench and hold that such circular or instructions by the Board could not have been issued to override statutory provisions or to 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. YAG DUTT 2025.05.02 13:18 I attest to the accuracy and authenticity of this order/judgment

CWP No.11680 of 2025 -3-

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.

20.

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

4.

Keeping in view above, we allow this writ petition in the afore-said terms. The observations and order passed above shall apply mutatis mutandis to the present case. Accordingly, notice dated 22.03.2025 (Annexure P-2) issued by respondent No.1-Assistant Commissioner of Income Tax, Central Circle – 1 Faridabad, under Section 148 of the Income Tax Act, 1961 and all consequential proceedings thereof are set-aside.

(SANJEEV PRAKASH SHARMA)

JUDGE

(MEENAKSHI I. MEHTA) April 29, 2025

JUDGE Yag Dutt

Whether speaking/reasoned: Yes/No

Whether Reportable: Yes/No YAG DUTT 2025.05.02 13:18 I attest to the accuracy and authenticity of this order/judgment

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