NARITA PAJNI vs. INCOME TAX OFFICER AND OTHERS

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CWP/27824/2024HC Punjab & HaryanaPHHC01139625202416 October 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition, applying the principles laid down in its previous judgments in Jasjit Singh vs. Union of India and others and Jatinder Singh Bhangu vs. Union of India and others. The Court reiterated its finding that circulars or instructions issued by the Board cannot override statutory provisions or render them obsolete. Legislative enactments with financial implications must be strictly followed. The Court held that authorities cannot usurp legal provisions for their convenience, causing hardship to assessees, and that instructions and circulars can only supplement statutory provisions. Consequently, notices issued by the JAO under Section 148A(b) dated 04.01.2024, the order under Section 148A(d) dated 09.02.2024, and the notice dated 09.02.2024 issued under Section 148 of the Income Tax Act, 1961, along with consequential proceedings, were set aside for want of jurisdiction because faceless assessment as envisaged under Section 144B was not conducted. The Revenue was granted liberty to follow the procedure laid down under the Act if so advised. The interim order stood merged with the present order.

What were the facts?

The petitioner, Narita Pajni, filed a writ petition before the High Court of Punjab and Haryana at Chandigarh challenging notices and an order issued by the Jurisdictional Assessing Officer (JAO) under Sections 148A and 148 of the Income Tax Act, 1961. The Revenue accepted notice. Both parties agreed that the issue was concluded by previous judgments of the High Court in Jasjit Singh vs. Union of India and others (decided on 29.07.2024) and Jatinder Singh Bhangu vs. Union of India and others (decided on 19.07.2024). The core of the dispute revolved around the procedure followed in reassessment proceedings, specifically whether faceless assessment, as envisaged under Section 144B of the Act, was conducted.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting faceless assessment as envisaged under Section 144B of the Act, are contrary to the provisions of the Act and liable to be set aside? (Question of law and mixed fact and law, turning on Sections 144B and 148 of the Income Tax Act, 1961). Assessee's Contention: The assessee, through their counsel, argued that the issue had been finally examined and concluded by this Court in previous judgments. They relied on the High Court's decision in Jasjit Singh vs. Union of India and others, which held that notices issued under Section 148 and subsequent proceedings without conducting faceless assessment under Section 144B were contrary to the Act and liable to be set aside for want of jurisdiction. Revenue's Contention: The Revenue, through their counsel, accepted notice and agreed that the issue was concluded by the aforementioned judgments. They did not present any arguments to distinguish the present case from the precedents cited.

Which sections of the Income-tax Act were involved?

Section 148,Section 144B,Section 148A,Section 119,Section 120

AI-generated summary — verify with the full judgment below

CWP-27824-2024 (O&M) Page 1 of 3 159 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-27824-2024 (O&M) Date of Decision: 16.10.2024 NARITA PAJNI . . . . Petitioner Vs. INCOME TAX OFFICER AND OTHERS . . . . Respondents **** CORAM: HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON’BLE MR. JUSTICE SANJAY VASHISTH **** Present: Mr. Nikhil Goyal, Advocate, and Ms. Dewangana Chillar, Advocate, for the petitioner. Mr. Saurabh Kapoor, Senior Standing Counsel, and Ms. Pridhi Sandhu, Jr. Standing Counsel, for the respondents/Revenue. **** SANJEEV PRAKASH SHARMA, J.(Oral) 1. Notice of motion. 2. Mr. Saurabh Kapoor, Senior Standing Counsel, and Ms. Pridhi Sandhu, Jr. Standing Counsel, accept notice on behalf of respondents/Revenue. 3. Both the counsel are ad idem that the issue involved in the present petition stands finally examined and concluded by this Court in CWP No.21509 of 2023 titled as Jasjit Singh vs. Union of India and others, decided on 29.07.2024, and by the Coordinate Bench in CWP No.15745 of 2024 titled as Jatinder Singh Bhangu vs. Union of India LAVISHA 2024.10.18 18:40 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

CWP-27824-2024 (O&M) Page 2 of 3 and others, decided on 19.07.2024. This Court in Jasjit Singh (supra) held as under: “16. We are in agreement with the view taken by the Coordinate Bench and hold that such circular or instructions by the Board could not have been issued to override statutory provisions or to make them otiose or obsolete. Legislative enactments having financial implications are required to be followed strictly and mandatorily. By exercising the powers contained in Sections 119 and 120 of the Act, 1961 as well as Section 144B (7 & 8), the authorities cannot be allowed to usurp the legal provisions to their own satisfaction and convenience causing hardship to the assessees. It also leaves confusion in the minds of the taxpayers. In the opinion of this Court, instructions and circulars can be issued only for the purpose of supplementing the statutory provisions and for their implementation. 17. In view of the aforesaid discussion, there is no occasion to distinguish or take a different view as suggested by the learned counsel for the revenue from what has already been held by the Coordinate Bench. 18. Keeping in view the law laid down by the Coordinate Bench (supra), notices issued by the JAO under Section 148 of the Act, 1961 and the proceedings initiated thereafter without conducting the faceless assessment as envisaged under Section 144B of the Act, 1961, have been found to be contrary to the provisions of the Act, 1961 and accordingly notices dated 28.02.2023, 16.03.2023, 20.03.2024 and LAVISHA 2024.10.18 18:40 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

CWP-27824-2024 (O&M) Page 3 of 3 30.03.2023 and order dated 30.03.2023, are set aside for want of jurisdiction. 19. The respondents-revenue would be, however, at liberty to follow the procedure as laid down under the Act, 1961 and proceed accordingly, if so advised. 20. All the writ petitions are allowed. The interim order passed by the Court shall stand merged with the present order.” 4. Keeping in view above, we allow this Writ Petition in the aforesaid terms. The observations and order passed above shall apply mutatis mutandis to the present case. Accordingly, notice under Section 148A (b) of the Act dated 04.01.2024, order under Section 148A(d) dated 09.02.2024 and notice dated 09.02.2024 issued by Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, as well as the consequential proceedings are set aside. 5. All pending applications also stand disposed of accordingly.

(SANJEEV PRAKASH SHARMA) JUDGE (SANJAY VASHISTH) JUDGE October 16, 2024 Lavisha 1. Whether speaking/reasoned? Yes/No 2. Whether reportable? Yes/No LAVISHA 2024.10.18 18:40 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

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