RANI GARG vs. UNION OF INDIA AND OTHERS

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CWP/28507/2024HC Punjab & HaryanaPHHC01142847202421 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, holding that notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting the faceless assessment as envisaged under Section 144B of the Act, 1961, are contrary to the provisions of the Act. The Court agreed with the view taken in *Jasjit Singh vs. Union of India and others* and *Jatinder Singh Bhangu vs. Union of India and others*, stating that circulars or instructions by the Board cannot override statutory provisions or make 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. Instructions and circulars can only supplement statutory provisions. Consequently, the notice issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, dated 29.03.2023, and all consequential proceedings were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act, 1961, if so advised. The interim order merged with the final order.

What were the facts?

This case involves a writ petition filed by Rani Garg (the petitioner) against the Union of India and others (the revenue). The petitioner challenged notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The petitioner argued that these actions were contrary to the law laid down by the High Court in previous judgments. The revenue accepted notice and did not present a separate argument, instead agreeing that the matter was concluded by prior High Court decisions. The assessment years are not explicitly stated, nor is a specific amount in dispute. The procedural history centers on the issuance of notices under Section 148 and the initiation of proceedings without adhering to the faceless assessment procedure under Section 144B.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings are liable to be set aside for want of jurisdiction if they are initiated without conducting the faceless assessment as envisaged under Section 144B of the Act, 1961? (Mixed question of law and fact, concerning Sections 148 and 144B of the Income Tax Act, 1961). Assessee's Contention: The petitioner contended that the notices and proceedings were contrary to the provisions of the Act, relying on prior judgments of the High Court. The petitioner argued that circulars and instructions issued by the Board cannot override statutory provisions or render them obsolete, and that legislative enactments must be followed strictly. The petitioner cited the decisions in *Jasjit Singh vs. Union of India and others* (CWP No.21509 of 2023, decided on 29.07.2024) and *Jatinder Singh Bhangu vs. Union of India and others* (CWP No.15745 of 2024, decided on 19.07.2024). Revenue's Contention: The revenue accepted notice and did not present separate arguments, agreeing that the substantial issue was concluded by the aforementioned High Court 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

125 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-28507-2024 (O&M) Date of Decision: 21.10.2024 Rani Garg …Petitioner Vs. Union of India and others

…Respondents CORAM: HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON’BLE MR. JUSTICE SANJAY VASHISTH Present: Mr. Jatinder Kumar Kamboj, Advocate for the petitioner.

SANJEEV PRAKASH SHARMA, J.(Oral) 1. Notice of motion. 2. Mr. Vaibhav Gupta, Sr. Standing Counsel, accepts notice on behalf of the revenue. 3. Learned counsel for the parties are ad idem that the substantial 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: “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 JOYTI RANI 2024.10.22 17:17 I attest to the accuracy and integrity of this document

[2] CWP-28507-2024 (O&M) 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. 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. JOYTI RANI 2024.10.22 17:17 I attest to the accuracy and integrity of this document

[3] CWP-28507-2024 (O&M) 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 issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, dated 29.03.2023 and all consequential proceedings are set aside. 5. All pending applications also stand disposed of accordingly. (SANJEEV PRAKASH SHARMA) JUDGE (SANJAY VASHISTH ) JUDGE 21.10.2024 joyti 1. Whether speaking/reasoned? : Yes/No 2. Whether reportable? : Yes/No JOYTI RANI 2024.10.22 17:17 I attest to the accuracy and integrity of this document

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