DHARMINDER KAPOOR vs. PR COMMISSIONER OF INCOME TAX AND ANOTHER

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CWP/34338/2024HC Punjab & HaryanaPHHC01177462202418 December 2024Author: 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 instructions issued by the Jurisdictional Assessing Officer (JAO) under Section 119 and 120 of the Income Tax Act, 1961, cannot override statutory provisions or be exercised to cause hardship to assessees or create confusion. The court agreed with the view taken by coordinate benches that circulars or instructions cannot be issued to make statutory provisions otiose, and that legislative enactments with financial implications must be followed mandatorily. Consequently, notices issued under Section 148 of the Act and proceedings initiated thereafter without conducting the faceless assessment as envisaged under Section 144B were found to be contrary to the provisions of the Act and were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly, if so advised. The writ petition was allowed, and interim orders stood merged with the present order.

What were the facts?

The petitioner, Ess Kay, filed a writ petition challenging a notice dated 26.03.2024 issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, and subsequent consequential proceedings. The petitioner argued that these proceedings were initiated without conducting a faceless assessment as envisaged by Section 144B of the Act. The revenue, represented by the Income Tax Department, accepted notice. The High Court noted that similar issues had been decided by coordinate benches in other writ petitions, specifically citing Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India, both decided on 09.07.2024. The court was presented with the question of whether instructions by the Board could override statutory provisions or render them obsolete.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting a faceless assessment as per Section 144B of the Act, are valid and have jurisdiction. (Mixed question of law and fact, concerning Sections 148 and 144B of the Income Tax Act, 1961). Assessee's Contention: The proceedings initiated under Section 148 and subsequent actions were invalid because they bypassed the mandatory faceless assessment procedure stipulated under Section 144B of the Act. The petitioner relied on the principle that instructions by the Board cannot override statutory provisions or make them obsolete, and that legislative enactments with financial implications must be followed strictly. Revenue's Contention: The revenue did not present any specific arguments against the petitioner's contentions. The Senior Standing Counsel accepted notice and stated that the issue involved had been finally examined and concluded by this Court in 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

145 IN TH DHARMINDE

PR. COMMIS

CORAM: H

H

Present: M M

f * SANJEEV PR

1.

N

2.

M behalf of the r

3.

B present petitio No.21509 of decided on 29 2024 titled a decided on 19

C i o o i m HE HIGH COURT OF PUNJA CHANDIGAR

CWP-3 Date of ER KAPOOR

V SSIONER OF INCOME TAX, LU

HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ

Mr. Rishabh Kapoor, Advocate f Mr. Ranvijay Singh, Senior Stand for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Mr. Ranvijay Singh, Senior Stan respondents/Income Tax Departm Both the counsel are ad idem on stands finally examined and c f 2023 titled as Jasjit Singh vs 9.07.2024, and by the Coordina as Jatinder Singh Bhangu vs. 9.07.2024. This Court in Jasjit Si “16. We are in agreement with Coordinate Bench and hold t instructions by the Board could n override statutory provisions or t obsolete. Legislative enactmen implications are required to be mandatorily. By exercising the AB AND HARYANA AT RH 34338-2024 (O&M) f Decision:18.12.2024

..…...Petitioner(s) V/s. UDHIANA AND ANOTHER …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH for the petitioner. ding Counsel, Department nding Counsel, accepts notice on ment. that the issue involved in the concluded by this Court in CWP s. Union of India and others, ate Bench in CWP No.15745 of . Union of India and others, Singh (supra) held as under: the view taken by the that such circular or not have been issued to to make them otiose or nts having financial e followed strictly and powers contained in ) n e P , f , Suresh Kumar 2024.12.19 11:39 I attest to the accuracy and integrity of this document

CWP-34338-202

S S a s a t a s i 1 o s w 1 C u p f o p d 3 f 1 l A 2 o p

4.

K aforesaid term mutandis to (Annexure P- 024 (O&M) 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 implementation.

17.

In view of the aforesaid d occasion to distinguish or take suggested by the learned counse what has already been held by th

18.

Keeping in view the law Coordinate Bench (supra), notic under Section 148 of the proceedings initiated thereafter w faceless assessment as envisage of the Act, 1961, have been foun 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-revenue w liberty to follow the procedure a Act, 1961 and proceed according

20.

All the writ petitions are order passed by the Court shall present order.” Keeping in view above, we a ms. The observations and order p the present case. According -1) issued by the Jurisdictional A 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 discussion, there is no e a different view as el for the revenue from he Coordinate Bench. w laid down by the ces issued by the JAO Act, 1961 and the without conducting the ed under Section 144B d to be contrary to the nd accordingly notices 23, 20.03.2024 and 03.2023, are set aside would be, however, at as laid down under the gly, if so advised. allowed. The interim stand merged with the allow this Writ Petition in the passed above shall apply mutatis gly, notice dated 26.03.2024 Assessing Officer u/s 148 of the e s 4 e Suresh Kumar 2024.12.19 11:39 I attest to the accuracy and integrity of this document

CWP-34338-202

Income Tax aside.

5.

A

December 18 Ess Kay

Whether speak Whether Repor 024 (O&M) Act, 1961 and all consequenti All pending applications also stan [SANJEEV 8, 2024

[SAN

king / reasoned :

Y rtable

:

Y ial proceedings thereof are set nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No t Suresh Kumar 2024.12.19 11:39 I attest to the accuracy and integrity of this document

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