R D MECHANICAL WORKS vs. INCOME TAX OFFICER AND OTHERS

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CWP/13728/2025HC Punjab & HaryanaPHHC01076052202526 May 2025Bench: MRS. JUSTICE LISA GILL,MRS. JUSTICE SUDEEPTI SHARMA2 pages
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What did the High Court hold?

The High Court allowed the writ petition, disposing of it in terms of two prior judgments by a Co-ordinate Bench: Jatinder Singh Bhangu vs. Union of India and others (CWP No. 15745-2024, decided on 19.07.2024) and Jasjit Singh vs. Union of India and others (CWP No. 21509-2023, decided on 29.07.2024). In those cases, the writ petitions were allowed on similar issues, with liberty granted to the revenue to follow the prescribed procedure under the Act, 1961, and proceed accordingly if advised. The reasoning was based on the petitioner's challenge to the jurisdiction of the issuing authority for the Section 148 notice, assessment order, and demand notice for AY 2017-2018, citing the CBDT circular dated 29.03.2022. The revenue did not contest this point. The operative direction is to dispose of the petition in terms of the cited precedents.

What were the facts?

The petitioner, R.D. Mechanical Works, challenged a notice dated 25.01.2024 under Section 148 of the Income Tax Act, 1961, an assessment order dated 24.01.2025 under Section 147, and a demand notice dated 24.01.2025, all pertaining to Assessment Year 2017-2018. The challenge was based on the assertion that the issuing authority lacked jurisdiction due to a CBDT circular dated 29.03.2022, which purportedly granted exclusive power to the National Faceless Assessment Centre (NFAC) to issue such notices. The revenue, represented by the Income Tax Officer, Ward 1 (3), Ludhiana, and others, did not dispute the petitioner's contention regarding the applicability of prior judgments.

What were the issues?

1. Whether the notice dated 25.01.2024 issued under Section 148 of the Income Tax Act, 1961, and the subsequent assessment order and demand notice for AY 2017-2018 are invalid due to lack of jurisdiction by the issuing authority, in light of the CBDT circular dated 29.03.2022, which allegedly vests exclusive power in the NFAC to issue Section 148 notices? (Question of law and fact, turning on Section 148 and CBDT Circular dated 29.03.2022). Assessee's Contention: The issuing authority lacked jurisdiction to issue the notice under Section 148 of the Act, 1961, as per the CBDT circular dated 29.03.2022, which specifically enumerates that the NFAC has exclusive power to issue such notices. Revenue's Contention: The learned counsel appearing for the Union of India did not dispute the petitioner's contention.

Which sections of the Income-tax Act were involved?

Section 148,Section 147

AI-generated summary — verify with the full judgment below

CWP-13728-2025 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 169 CWP-13728-2025 (O&M) Date of Decision:-26.05.2025 R.D. Mechanical Works ....Petitioner Vs. Income Tax Officer, Ward 1 (3), Ludhiana & ors. ...Respondents CORAM: HON'BLE MRS. JUSTICE LISA GILL HON'BLE MRS. JUSTICE SUDEEPTI SHARMA Present: Mr. Vishav Bharti Gupta, Advocate Ms Mamta Gupta, Advocate, for the petitioner. Mr. Ranvijay Singh, Sr. Standing counsel for the respondents. *** SUDEEPTI SHARMA, J. 1. Challenge in the present petition is to notice dated 25.01.2024 issued under Section 148 of the Income Tax Act, 1961 (for short ‘Act 1961”); assessment order dated 24.01.2025 issued under Section 147 of the Act, 1961; demand notice dated 24.01.2025 and all consequential actions, for AY 2017-2018. 2. Learned counsel for the petitioner contends that the issue involved in the present writ petition is covered by the judgment passed by a Co-ordinate Bench of this Court in the cases of Jatinder Singh Bhangu vs. Union of India and others, passed in CWP No. 15745-2024 and connected matter, decided on 19.07.2024 and Jasjit Singh vs. Union of India and others (CWP No. 21509- 2023 and other connected matters), decided on 29.07.2024. 3. Learned counsel appearing for Union of India has also not disputed the same. 4. We have heard learned counsel for the parties and perused the whole records of the case. Gaurav Arora 2025.05.29 18:34 I attest to the accuracy and integrity of this document

CWP-13728-2025 2 5. The petitioner has challenged the notice dated 25.01.2024 issued under Section 148 of the Act, 1961; assessment order dated 24.01.2025 issued under Section 147 of the Act, 1961; demand notice dated 24.01.2025 and all consequential actions, for AY 2017-2018 on the ground that the Issuing Authority had no jurisdiction to issue the same, in view of the circular/notification dated 29.03.2022 of the CBDT, wherein, it has been specifically enumerated that the NFAC has exclusive power to issue the notice under Section 148 of the Act, 1961. 6. A Co-ordinate Bench of this Court in Jatinder Singh Bhangu’s case (supra) and Jasjit Singh’s case (supra), allowed the writ petitions on the same issue, as raised in the present writ petition, by granting liberty to the revenue to follow the procedure as laid down under the Act, 1961 and proceed accordingly, if so advised. 7. In view of the above, the present writ petition is disposed of, in terms of Jatinder Singh Bhangu’s case (supra), decided on 19.07.2024 and Jasjit Singh’s case (supra), decided on 29.07.2024. 8. All the pending applications, if any, also stand disposed of. (LISA GILL)

(SUDEEPTI SHARMA) JUDGE JUDGE 26.05.2025

Gaurav Arora Whether speaking/reasoned : Yes/No Whether reportable : Yes/No Gaurav Arora 2025.05.29 18:34 I attest to the accuracy and integrity of this document

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