DIMPLE BHATIA vs. UNION OF INDIA AND OTHERS

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CWP/22825/2024HC Punjab & HaryanaPHHC01120162202409 September 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that instructions and circulars issued by the Board cannot override statutory provisions or be issued to make them obsolete. Legislative enactments with financial implications must be followed strictly. The powers contained in Sections 119 and 120 of the Income Tax Act, 1961, as well as Section 144B (7 & 8), cannot be exercised to usurp legal provisions to the convenience of assessees, as this causes hardship and confusion. Instructions can only be issued for supplementing statutory provisions and for their implementation. Following the law laid down by a Coordinate Bench in Jasjit Singh (supra), the Court found that notices issued by the JAO under Section 148 of the Act and the consequential faceless assessment proceedings initiated under Section 144B were contrary to the provisions of the Act. Therefore, the notices dated 23.03.2023, 20.03.2024, 16.03.2023, 30.03.2023, and 30.03.2023 were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure as 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 petitioners, Dimple Bhatia and others, filed a writ petition before the Punjab and Haryana High Court challenging notices issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, and consequential assessment proceedings initiated under Section 144B. The assessment year(s) are not explicitly stated but the notices challenged are dated between March 2023 and March 2024. The revenue, Union of India and others (Income Tax Department), was represented. The High Court noted that the issue was similar to previously decided cases, specifically Jasjit Singh vs. Union of India and others and Jatinder Singh Bhangu vs. Union of India and others, both decided on July 19, 2024. The Court was informed that both counsel were in agreement on the issue.

What were the issues?

1. Whether notices issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, and consequential proceedings initiated under Section 144B, are valid when they are found to be contrary to the provisions of the Act and the instructions issued by the JAO, particularly in light of faceless assessment procedures? Assessee's Contention: The assessee argued, implicitly through reliance on the cited judgments, that instructions and circulars cannot override statutory provisions or make them otiose. Legislative enactments with financial implications must be followed strictly. The powers under Sections 119 and 120 of the Act, as well as Section 144B (7 & 8), cannot be exercised to usurp legal provisions for the convenience of assessees, causing hardship and confusion. Instructions can only supplement statutory provisions and their implementation. Revenue's Contention: The revenue, through the Senior Standing Counsel, accepted notice and was ad idem with the petitioner's counsel, indicating agreement with the legal position as decided 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

141 IN TH DIMPLE BHA

UNION OF IN

CORAM: H

Present: M

M f

* SANJEEV PR

1.

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

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

CWP-2 Date of ATIA

V NDIA AND OTHERS

HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ Mr. Prateek Gupta, Advocate for Mr. Ranvijay Singh, Senior Stand for the respondents/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 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 mandatorily. By exercising the Sections 119 and 120 of the A AB AND HARYANA AT RH 22825-2024 (O&M) f Decision:09.09.2024

..…...Petitioners (s) V/s. …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH r the petitioner. ding Counsel, Department. nding Counsel, accepts notice on ment. 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 powers contained in Act, 1961 as well as n e n , f , Suresh Kumar 2024.09.10 09:36 I attest to the accuracy and integrity of this document

CWP-22825-2024

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 4 (O&M) Page 2 of 3

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 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-22825-2024

Assessing O consequential 5. A

September 9, Ess Kay

Whether speak Whether Repor 4 (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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