JAWAHAR LAL vs. UNION OF INDIA AND OTHERS

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CWP/27831/2024HC Punjab & HaryanaPHHC01140122202416 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. It held that circulars or instructions issued by the Board cannot override statutory provisions or render them otiose. Legislative enactments with financial implications must be followed strictly. The Court found that authorities cannot usurp legal provisions for their convenience, causing hardship to assessees and confusion. Instructions and circulars can only supplement statutory provisions. Consequently, notices issued by the JAO under Section 148 and subsequent proceedings, initiated without conducting faceless assessment as envisaged under Section 144B, were found to be contrary to the Act. The Court set aside the notice under Section 148A(b) dated 10.03.2023, order under Section 148A(d) dated 06.04.2023, and notice dated 06.04.2023 under Section 148 of the Income Tax Act, 1961, along with consequential proceedings, for want of jurisdiction. The Revenue was granted liberty to follow the prescribed procedure if advised. The interim order merged with the final order.

What were the facts?

The petitioner, Jawahar Lal, filed a writ petition before the High Court of Punjab and Haryana at Chandigarh. The petition challenged notices and orders issued by the Jurisdictional Assessing Officer under Sections 148A(b), 148A(d), and 148 of the Income Tax Act, 1961, along with consequential proceedings. The Revenue accepted notice. Both parties agreed that the issue was concluded by prior judgments of the High Court in similar writ petitions, specifically CWP No.21509 of 2023 (Jasjit Singh vs. Union of India) decided on 29.07.2024, and CWP No.15745 of 2024 (Jatinder Singh Bhangu vs. Union of India) decided on 19.07.2024. The core of the dispute revolved around the procedure followed in reassessment proceedings.

What were the issues?

1. Whether notices issued by the JAO 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? (Mixed question of law and fact, concerning Sections 144B and 148 of the Income Tax Act, 1961). Assessee's Contention: The assessee relied on the judgments in Jasjit Singh and Jatinder Singh Bhangu, which held that circulars or instructions by the Board cannot override statutory provisions. They argued that faceless assessment, as envisaged under Section 144B, is mandatory and its absence vitiates the proceedings. Revenue's Contention: The revenue suggested distinguishing the present case from the previously decided ones. However, the Court noted that the Coordinate Bench in Jasjit Singh did not find any occasion to distinguish the case.

Which sections of the Income-tax Act were involved?

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

AI-generated summary — verify with the full judgment below

CWP-27831-2024 (O&M) Page 1 of 3 163 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-27831-2024 (O&M) Date of Decision: 16.10.2024 JAWAHAR LAL . . . . Petitioner Vs. UNION OF INDIA AND OTHERS . . . . Respondents **** CORAM: HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON’BLE MR. JUSTICE SANJAY VASHISTH **** Present: Mr. Satyam Aneja, Advocate, for the petitioner. for the respondents/Revenue. **** SANJEEV PRAKASH SHARMA, J.(Oral) 1. Notice of motion. 2. accepts 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 and others, decided on 19.07.2024. This Court in Jasjit Singh (supra) held as under: LAVISHA 2024.10.18 18:41 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

CWP-27831-2024 (O&M) Page 2 of 3 “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 30.03.2023 and order dated 30.03.2023, are set aside for want of jurisdiction. LAVISHA 2024.10.18 18:41 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

CWP-27831-2024 (O&M) Page 3 of 3 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 10.03.2023, order under Section 148A(d) dated 06.04.2023 and notice dated 06.04.2023 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 18:41 I attest to the accuracy and authenticity of this order/judgment Punjab & Haryana High Court, Chandigarh

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