DOLLAR GULATI vs. DY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE KARNAL

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CWP/23833/2024HC Punjab & HaryanaPHHC01125687202418 September 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
AI SummaryAllowed

What did the High Court hold?

The Tribunal held that instructions by the Board (Circulars) cannot override statutory provisions or make them obsolete. Legislative enactments with financial implications must be followed mandatorily. The authorities cannot usurp legal provisions to their own satisfaction or convenience, causing hardship and confusion to assessees. Instructions and circulars can only supplement statutory provisions for their implementation. In light of the law laid down by a Coordinate Bench in Jasjit Singh vs. Union of India, the notices issued by the JAO under Section 148 of the Act, 1961, and the proceedings initiated thereafter without conducting faceless assessment as envisaged under Section 144B of the Act, 1961, were found to be contrary to the provisions of the Act. Consequently, the notices dated 28.02.2023, 16.03.2023, 20.03.2023, 30.03.2023, and 30.03.2024 were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure as laid down under the Act, 1961, and proceed accordingly if advised. The writ petitions were allowed, and interim orders were merged with the final order.

What were the facts?

The petitioners, Ess Kay and others, challenged notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated under Section 144B. The assessment years are not explicitly stated. The challenge was based on the argument that these notices and proceedings were issued without jurisdiction, particularly in light of faceless assessment procedures. The High Court of Punjab and Haryana at Chandigarh was hearing the writ petition. The revenue, represented by the Deputy Commissioner of Income Tax, Central Circle, Karnal, accepted notice. The court noted that similar issues had been decided by coordinate benches in previous cases, specifically Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India, decided on July 9, 2024.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings under Section 144B, initiated without conducting faceless assessment as envisaged by the Act, are valid and issued with jurisdiction? (Question of law and fact, turning on Sections 148 and 144B of the Income Tax Act, 1961). Assessee's Contention: The petitioner argued that the notices and proceedings were without jurisdiction. While not explicitly detailed, the context implies reliance on the principles established in prior judgments by coordinate benches regarding the proper application of faceless assessment procedures. Revenue's Contention: The revenue's counsel accepted notice and did not present any arguments against the petitioner's claim. The judgment states that the counsel for the respondent-Income Tax Department accepted notice and that both counsel were ad idem, indicating agreement with the issue being concluded by 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

124 IN TH DOLLAR GU

DEPUTY CO KARNAL

CORAM: H

Present: M M

M f

* SANJEEV PR

1.

N 2. M on behalf of th 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 ULATI

V OMMISSIONER OF INCOME

HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ

(Through Video Conferencin Mr. Anand Chaudhari, Advocate Mr. Mahesh Kumar, Advocate fo Ms. Gauri Neo Rampal, Senior S for the respondent-Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Ms. Gauri Neo Rampal, Senior S he respondents/Income Tax Dep 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 23833-2024 (O&M) f Decision:18.09.2024

..…...Petitioners (s) V/s. ME TAX, CENTRAL CIRCLE …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH ng/Hybrid Mode) e and or the petitioner. Standing Counsel Department. Standing Counsel, accepts notice partment. 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 E e e P , f , Suresh Kumar 2024.09.19 10:38 I attest to the accuracy and integrity of this document

CWP-23833-202

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) 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 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 2024.09.19 10:38 I attest to the accuracy and integrity of this document

CWP-23833-202

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September 18 Ess Kay

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

the present case. Accordin Assessing Officer u/s 148 dated sequential proceedings are set asi All pending applications also stan [SANJEEV 8, 2024 [SAN

king / reasoned :

Y rtable

Y gly, notice(s) issued by the d 31.03.2024 (Annexures P-1 to ide. nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No e o Suresh Kumar 2024.09.19 10:38 I attest to the accuracy and integrity of this document

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