HISAR SPINNING MILLS LTD vs. UNION OF INDIA AND OTHERS

PDF · subscribers
CWP/30215/2024HC Punjab & HaryanaPHHC01154547202407 November 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that assessment proceedings initiated without conducting faceless assessment as envisaged under Section 144B of the Income Tax Act, 1961, are contrary to the provisions of the Act. The Court agreed with the view taken by its Coordinate Bench, which held that circulars or instructions cannot override statutory provisions or make them obsolete. The Court emphasized that legislative enactments with financial implications must be followed mandatorily. It stated that 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 and aid in their implementation. Therefore, notices issued under Section 148 and subsequent proceedings initiated without adhering to the faceless assessment procedure under Section 144B were found to be without jurisdiction and were set aside. The revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly if advised. The writ petition was allowed.

What were the facts?

The petitioner, Mr. Anurag Gupta, through its Managing Director, filed a writ petition challenging a notice dated 31.08.2024 issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, and all consequential proceedings. The petitioner argued that the assessment proceedings were initiated without conducting the faceless assessment as envisaged under Section 144B of the Act. The revenue, represented by Ms. Gauri Neo Rampal, Senior Standing Counsel, accepted notice. The High Court noted that similar issues had been decided by its Coordinate Bench in previous writ petitions.

What were the issues?

1. Whether the assessment proceedings initiated under Section 148 of the Income Tax Act, 1961, without conducting faceless assessment as envisaged under Section 144B, are valid and in accordance with the law? (Question of law and mixed fact and law, turning on Section 144B and Section 148 of the Income Tax Act, 1961). Assessee's Contention: The assessment proceedings were initiated without conducting the faceless assessment as envisaged under Section 144B of the Act, rendering them invalid. The petitioner relied on the principle that instructions by the Board cannot override statutory provisions and that legislative enactments with financial implications must be followed mandatorily. Revenue's Contention: The judgment records that the counsel for the revenue accepted notice, but no specific arguments were recorded for the revenue in opposition to the petitioner's claim.

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

109 IN TH HISAR SPINN MR. ANURAG

UNION OF IN CORAM: H

Present: 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-3 Date of NING MILLS LTD. THROUGH I G GUPTA

V NDIA AND OTHERS HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ Mr. Prateek Gupta, Advocate for 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 30215-2024 (O&M) f Decision:07.11.2024 ITS MANAGING DIRECTOR

..…...Petitioner(s) V/s. …......Respondent(s)

NJEEV PRAKASH SHARMA NJAY VASHISTH r 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 P , f , Suresh Kumar 2024.11.11 09:38 I attest to the accuracy and integrity of this document

CWP-30215 -20

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 2024.11.11 09:38 I attest to the accuracy and integrity of this document

CWP-30215 -20

mutandis to (Annexure P- Income Tax aside. 5. A

November 7, Ess Kay

Whether speak Whether Repor

024 (O&M) Page 3 of 3

the present case. According -1) issued by the Jurisdictional A Act, 1961 and all consequenti All pending applications also stan [SANJEEV , 2024

[SAN

king / reasoned :

Y rtable

Y gly, notice dated 31.08.2024 Assessing Officer u/s 148 of the ial proceedings thereof are set nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No

4 e t Suresh Kumar 2024.11.11 09:38 I attest to the accuracy and integrity of this document

More judgments on Section 148

All 35,022 judgments and leading authorities on Section 148 →

Recent GST High Court judgments

Search GST case law →