SAMEER DALMIA AND SONS HUF vs. PR COMMISSIONER OF INCOME TAX AND ANOTHER

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CWP/28845/2024HC Punjab & HaryanaPHHC01145233202423 October 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 notices issued under Section 148 of the Income Tax Act, 1961, and all consequential proceedings initiated thereafter, including those under the faceless assessment scheme as envisaged by Section 144B, were liable to be set aside for want of jurisdiction. The Court reiterated its previous findings in Jasjit Singh and Jatinder Singh Bhangu, emphasizing that circulars or instructions issued by the Board cannot override statutory provisions or make them obsolete. The Court reasoned that authorities cannot usurp legal provisions to their own satisfaction or convenience, causing hardship and confusion to assessees. Instructions from the Board are meant for supplementing statutory provisions and for their implementation. Therefore, the notices dated 23.03.2024, 28.02.2023, 16.03.2023, 20.03.2024, and 30.03.2023 were set aside. The revenue was granted liberty to follow the procedure laid down under the Act if so advised. The writ petition was allowed, and interim orders stood merged with the final order.

What were the facts?

The petitioner, M/s Dalmia And Sons HUF (through its Karta Sameer Dalmia), filed a writ petition challenging a notice dated 23.03.2024 issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, and all consequential proceedings. The revenue, represented by the Commissioner of Income Tax, Patiala, and others, accepted notice. The High Court noted that the issue was covered by its previous decisions in Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India, both decided on 19.07.2024. These prior judgments had dealt with similar challenges to notices issued under Section 148 and subsequent proceedings initiated under the faceless assessment scheme.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated under the faceless assessment scheme, as envisaged by Section 144B, are liable to be set aside for want of jurisdiction when they are found to be contrary to the provisions of the Act and relevant circulars. Assessee's Contention: The assessee argued, by relying on the precedent set by the High Court in Jasjit Singh and Jatinder Singh Bhangu, that notices issued under Section 148 and subsequent faceless assessment proceedings were without jurisdiction and contrary to the Act. The core of the argument was that instructions from the Board (circulars) cannot override statutory provisions or render them otiose, and that legislative enactments with financial implications must be followed strictly. Revenue's Contention: The revenue did not present any arguments against the assessee's position, as indicated by the court's observation that both counsel were 'ad idem' and the issue was concluded by previous 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

142 IN TH SAMEER DAL (THROUGH ITS PRINCIPAL BHAWAN, RI

CORAM: H

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Present: M

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* 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 HE HIGH COURT OF PUNJA CHANDIGAR

CWP-2 Date of LMIA AND SONS HUF TS KARTA SAMEER DALMIA) V COMMISSIONER OF INCOM ISHI NAGAR, LUDHIANA AND

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 AB AND HARYANA AT RH 28845-2024 (O&M) f Decision:23.10.2024

..…...Petitioner(s)

V/s. ME TAX, PATIALA, AYAKAR 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 R

) n e P , f , Suresh Kumar 2024.10.24 12:26 I attest to the accuracy and integrity of this document

CWP-28845-202

m 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 024 (O&M) 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 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 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 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 e s Suresh Kumar 2024.10.24 12:26 I attest to the accuracy and integrity of this document

CWP-28845-202

mutandis to (Annexure P- Income Tax A 5. A

October 23, 2 Ess Kay

Whether speak Whether Repor 024 (O&M) the present case. According -2) issued by the Jurisdictional A Act, 1961 and all consequential p All pending applications also stan [SANJEEV 2024

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king / reasoned :

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Y gly, notice dated 23.03.2024 Assessing Officer u/s 148 of the proceedings are set aside. nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No 4 e Suresh Kumar 2024.10.24 12:26 I attest to the accuracy and integrity of this document

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