AJIT RANDHAWA vs. ASSISTANT COMISSIONER OF INCOME TAX

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CWP/25946/2024HC Punjab & HaryanaPHHC01134529202404 October 2024Author: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE ALOK JAIN3 pages
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What did the High Court hold?

The High Court, in agreement with its previous decisions in Jasjit Singh and Jatinder Singh Bhangu, held that instructions or circulars issued by the Board cannot override statutory provisions. The Court found that the notices issued by the JAO under Section 148 of the Income Tax Act, 1961, and the subsequent faceless assessment proceedings initiated under Section 144B were contrary to the provisions of the Act. Consequently, these notices and proceedings were set aside for want of jurisdiction. The Court reasoned that legislative enactments have financial implications and must be followed mandatorily, and that authorities cannot usurp legal provisions for their own satisfaction or convenience. The Court also noted that such actions can cause hardship and confusion to taxpayers. The revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly, if so advised. All interim orders were merged with the present order.

What were the facts?

The petitioner, Ajit Randhaw, filed a writ petition challenging a notice issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, dated March 31, 2024, and all consequential proceedings. The petitioner argued that the assessment proceedings were initiated without jurisdiction. The respondents were the Commissioner of Income Tax and others. The High Court referred to two previous decisions: Jasjit Singh vs. Union of India and others, decided on July 29, 2024, and Jatinder Singh Bhangu vs. Union of India and others, decided on July 19, 2024. In these cases, the Court had dealt with similar challenges to notices and assessment proceedings initiated under Section 148 and subsequent faceless assessments under Section 144B.

What were the issues?

1. Whether notices issued by the JAO under Section 148 of the Income Tax Act, 1961, and subsequent faceless assessment proceedings initiated under Section 144B, are liable to be set aside for want of jurisdiction, particularly when they are found to be contrary to the provisions of the Act and instructions issued by the JAO dated 28.02.2023, 16.03.2023, 20.03.2024, 30.03.2023, and 30.03.2023. Assessee's Contention: The assessee contended that the assessment proceedings were initiated without jurisdiction, implying a procedural or substantive flaw in the initiation and conduct of the assessment. Revenue's Contention: The revenue, through its Senior Standing Counsel, accepted notice and did not present a distinct argument against the assessee's claim, as the matter was to be decided based on previous judgments. 2. Whether instructions or circulars issued by the Board can override statutory provisions or be issued in a manner that makes them otiose or obsolete, or allow authorities to usurp legal provisions for their convenience, causing hardship and confusion to assessees.

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

113 IN TH Ajit Randhaw

Assistant Com

CORAM: H

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Present: M

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* SANJEEV PR

1.

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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 HE HIGH COURT OF PUNJA CHANDIGAR

CWP-2 Date of wa

V/s mmissioner of Income Tax and o

HON'BLE MR. JUSTICE SAN HON'BLE MR. JUSTICE ALO

Mr. Vishal Bharti Gupta, Advoca Ms. Mamta Gupta, Advocate for Mr. Yogesh Putney, Senior Stand for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Mr. Yogesh Putney, Senior Stan respondent-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 S “16. We are in agreement with Coordinate Bench and hold t nstructions by the Board could n override statutory provisions or t AB AND HARYANA AT RH 25946-2024 (O&M) f Decision:04.10.2024

..…...Petitioner others

…......Respondents NJEEV PRAKASH SHARMA OK JAIN ate and 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 r

s n e P , f , PARUL 2024.10.14 10:37 I attest to the accuracy and authenticity of this document

CWP-25946-2

o i 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 2024 (O&M) 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 aforesaid d occasion to distinguish or take suggested by the learned counse what has already been held by th

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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 found provisions of the Act, 1961 an dated 28.02.2023, 16.03.202 30.03.2023 and order dated 30. for want of jurisdiction.

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The respondents-revenue w liberty to follow the procedure a Act, 1961 and proceed according

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All the writ petitions are order passed by the Court shall present order.” nts having financial e 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 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 d 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 PARUL 2024.10.14 10:37 I attest to the accuracy and authenticity of this document

CWP-25946-2

4.

K aforesaid term mutandis to th Assessing O consequential

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A

October 04, 2 Parul

Whether speak Whether Repor 2024 (O&M) Keeping in view above, we a ms. The observations and order p he present case. Accordingly, no fficer u/s 148 dated 31.03.2 l proceedings are set aside. All pending applications also stan [SANJEEV 2024

king / reasoned :

Y rtable

:

Y allow this Writ Petition in the passed above shall apply mutatis otice issued by the Jurisdictional 2024 (Annexure P-1) and all nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

[ALOK JAIN] JUDGE Yes / No Yes / No e s l l PARUL 2024.10.14 10:37 I attest to the accuracy and authenticity of this document

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