NORTHERN ROYALTY COMPANY vs. UNION OF INDIA AND OTHERS

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CWP/2508/2025HC Punjab & HaryanaPHHC01014743202530 January 2025Bench: MR. JUSTICE ARUN PALLI,MRS. JUSTICE SUDEEPTI SHARMA2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the issue raised in the writ petition was covered by previous judgments of a Co-ordinate Bench in Jatinder Singh Bhangu's case and Jasjit Singh's case. In those cases, the writ petitions were allowed on similar grounds, with liberty granted to the revenue to follow the prescribed procedure under the Act, 1961, and proceed accordingly if advised. Consequently, the present writ petition was disposed of in terms of these earlier judgments. The operative direction was to dispose of the writ petition in terms of the cited precedents, implying that the impugned notices and order were set aside, with the revenue having the option to re-initiate proceedings following the correct procedure. No issue was expressly left undecided.

What were the facts?

The petitioner, Northern Royalty Company, filed a writ petition challenging a notice dated 31.08.2024 under Section 148 of the Income Tax Act, 1961, an order dated 31.08.2024 under Section 148A(d), and a show cause notice dated 23.08.2024 under Section 148A(b) of the Act, pertaining to Assessment Year 2017-2018. The petitioner argued that the issuing authority lacked jurisdiction due to a CBDT circular dated 29.03.2022, which vests exclusive power to issue Section 148 notices with the National Faceless Assessment Centre (NFAC). The respondent-Union of India did not dispute this contention.

What were the issues?

1. Whether the notice dated 31.08.2024 issued under Section 148 of the Income Tax Act, 1961, the order dated 31.08.2024 issued under Section 148A(d), and the show cause notice dated 23.08.2024 issued under Section 148A(b) of the Act, 1961, for AY 2017-2018, are without jurisdiction, in light of the CBDT circular dated 29.03.2022, which grants exclusive power to the NFAC to issue notices under Section 148 of the Act, 1961? (Question of law and mixed fact and law, turning on Section 148 and Section 148A of the Act, 1961, and CBDT Circular dated 29.03.2022). Assessee's contention: The issuing authority lacked jurisdiction to issue the impugned notices and order due to the CBDT circular dated 29.03.2022, which stipulates that the NFAC has exclusive power to issue notices under Section 148 of the Act, 1961. The petitioner relied on the judgments in Jatinder Singh Bhangu vs. Union of India and others (CWP No. 15745-2024) and Jasjit Singh vs. Union of India and others (CWP No. 21509-2023). Revenue's contention: The revenue did not dispute the petitioner's contention.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A

AI-generated summary — verify with the full judgment below

CWP-2508-2025 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 129 CWP-2508-2025 (O&M) Date of Decision:-30.01.2025 Northern Royalty Company ....Petitioner Vs. Union of India and ors. ...Respondents CORAM: HON'BLE MR. JUSTICE ARUN PALLI HON'BLE MRS. JUSTICE SUDEEPTI SHARMA Present: Mr. Tajender Joshi, Advocate for the petitioner Mr. Saurabh Kapoor, Sr. Standing counsel with Ms. Muskan Gupta, Advocate for the respondent-Union of India. *** SUDEEPTI SHARMA, J. 1. Challenge in the instant writ petition is to notice dated 31.08.2024 issued under Section 148 of the Income Tax Act, 1961 (for short “Act 1961”); order dated 31.08.2024 issued under Section 148 A(d) of the Act, 1961 and show cause notice dated 23.08.2024 issued under Section 148 A(b) of the Act, 1961 and conseuqential proceedings, 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. Gaurav Arora 2025.02.05 14:00 I attest to the accuracy and integrity of this document

CWP-2508-2025 2 4. We have heard learned counsel for the parties and perused the whole records of the case. 5. The petitioner has challenged the notice dated 31.08.2024 issued under Section 148 of the Act, 1961; order dated 31.08.2024 issued under Section 148 A(d) of the Act, 1961 and show cause notice dated 23.08.2024 issued under Section 148 A(b) of the Act, 1961 and conseuqential proceedings, 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. (ARUN PALLI) (SUDEEPTI SHARMA) JUDGE JUDGE 30.01.2025

Gaurav Arora

Whether speaking/reasoned : Yes/No Whether reportable : Yes/No Gaurav Arora 2025.02.05 14:00 I attest to the accuracy and integrity of this document

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