GURTEJ SINGH vs. INCOME TAX OFFICER AND OTHERS

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CWP/22809/2024HC Punjab & HaryanaPHHC01120136202409 September 2024Bench: 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 the consequential proceedings initiated under Section 144B, without conducting the faceless assessment as envisaged by the Act, were found to be contrary to the provisions of the Act. The Court relied on its previous decisions in Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India. The reasoning was that instructions by the Board (circulars) cannot override statutory provisions or make them obsolete. Legislative enactments with financial implications must be followed strictly and mandatorily. The Court emphasized that authorities cannot usurp legal provisions for their convenience, causing hardship and confusion. Instructions and circulars can only supplement statutory provisions for implementation. Therefore, the notices dated February 28, 2023, March 16, 2023, March 20, 2023, March 23, 2023, and March 30, 2023, along with the notice dated March 23, 2024, and all consequential proceedings, were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act if so advised. The operative direction was to allow the writ petition, setting aside the impugned notices and proceedings.

What were the facts?

The petitioners, Gurtej Singh and others, challenged notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated under Section 144B. The assessment year(s) are not explicitly stated, but the notices were dated between February 28, 2023, and March 30, 2023, with a further notice dated March 23, 2024. The challenge was to the validity of these notices and the faceless assessment proceedings. The revenue, represented by the Income Tax Officer, Ward-2, Ambala, and others, accepted notice. The High Court noted that similar issues had been decided by coordinate benches in previous writ petitions, specifically CWP No. 21509 of 2023 (Jasjit Singh vs. Union of India) and CWP No. 15745 of 2023 (Jatinder Singh Bhangu vs. Union of India).

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated under Section 144B, without conducting a proper faceless assessment as envisaged by the Act, are valid and sustainable in law? The assessee (petitioners) contended that the notices and subsequent proceedings were contrary to the provisions of the Income Tax Act, 1961, and the principles of natural justice, particularly concerning the faceless assessment scheme. They argued that the authorities could not override statutory provisions for their convenience and that such actions cause hardship and confusion to taxpayers. They relied on the decisions of coordinate benches in Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India. The revenue (respondents) did not present any arguments against the petitioners' contentions, as their counsel accepted notice and agreed that the issue was already decided by this Court. The judgment records no specific arguments made by the revenue.

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

129 IN TH GURTEJ SIN

INCOME TA AMBALA, HA

CORAM: H

Present: M M

M M f

* SANJEEV PR

1.

N 2. M on behalf of th 3. B present petiti CWP No.215 decided on 29 2024 titled a decided on 19

C i o o i HE HIGH COURT OF PUNJA CHANDIGAR

CWP-2 Date of NGH

V AX OFFICER, WARD-2, AM ARYANA AND OTHERS HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ Mr. B.M. Monga, Advocate, and Mr. Rohit Kaura, Advocate for th Mr. Saurabh Kapoor, Senior Stan Ms. Muskaan Gupta, Advocate for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Mr. Saurabh Kapoor, Senior St he respondent-Income Tax Depa Both the counsel are ad idem ion stands finally examined an 509 of 2023 titled as Jasjit Singh 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 22809-2024 (O&M) f Decision:09.09.2024

..…...Petitioners (s) V/s. MBALA, AAYAKAR BHAWAN,

......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH d he petitioner. nding Counsel, with Department tanding Counsel, accepts notice artment that the issue involved in the nd concluded by this Court in h vs. 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

e e n , f , Suresh Kumar 2024.09.10 09:36 I attest to the accuracy and integrity of this document

CWP-22809-202

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 mutandis to th 024 (O&M) Page 2 of 3

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 he present case. Accordingly, no 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 otice issued by the Jurisdictional e s l Suresh Kumar 2024.09.10 09:36 I attest to the accuracy and integrity of this document

CWP-22809-202

Assessing O consequential 5. A

September 9, Ess Kay

Whether speak Whether Repor 024 (O&M) Page 3 of 3

Officer u/s 148 dated 23.03 l proceedings are set aside. All pending applications also stan [SANJEEV , 2024 [SAN

king / reasoned :

Y rtable

Y 3.2024 (Annexure P-1), and nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No d Suresh Kumar 2024.09.10 09:36 I attest to the accuracy and integrity of this document

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