ANIL SHARMA vs. INCOME TAX OFFICER AND OTHERS

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CWP/32231/2024HC Punjab & HaryanaPHHC01166552202417 December 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
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What did the High Court hold?

The High Court held that instructions issued by the Board (Circulars) cannot override statutory provisions or render legislative enactments obsolete. The Court agreed with the view taken by a Coordinate Bench in previous cases (Jasjit Singh and Jatinder Singh Bhangu) that such circulars cannot be used to make statutory provisions otiose. The Court found that the notices issued under Section 148 of the Income Tax Act, 1961, and the subsequent faceless assessment proceedings initiated under Section 144B, were contrary to the provisions of the Act. Therefore, the notices dated 31.03.2024, 16.03.2023, 20.03.2024, 30.03.2023, and the order dated 30.03.2023 were set aside for want of jurisdiction. The revenue was granted liberty to follow the procedure laid down under the Act and proceed accordingly. The Court also noted that all pending interim orders and applications stood disposed of.

What were the facts?

The petitioner, Anil Sharma, filed a writ petition challenging notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The petitioner argued that these actions were taken without proper jurisdiction and in contravention of statutory provisions. The revenue contended that the notices and proceedings were valid. The High Court was considering this petition along with other similar petitions, including CWP-32231-2024, CWP-215509-2023 (Jasjit Singh vs. Union of India), and CWP-157745-2024 (Jatinder Singh Bhangu vs. Union of India). The core of the dispute revolved around the validity of faceless assessment proceedings and the interpretation of instructions issued by the CBDT.

What were the issues?

1. Whether notices issued under Section 148 of the Income Tax Act, 1961, and subsequent faceless assessment proceedings initiated under Section 144B of the Act, are valid when they are alleged to be contrary to the provisions of the Act and potentially otiose or obsolete due to instructions from the Board. Assessee's Contention: The assessee argued that the notices and proceedings were invalid. They relied on the principle that instructions from the Board (Circulars) cannot override statutory provisions or make legislative enactments obsolete. The assessee contended that the authorities cannot usurp legal provisions for their convenience, causing hardship and confusion. Revenue's Contention: The revenue, represented by the learned counsel, suggested that there might be grounds to distinguish the present case or take a different view from previous judgments. However, the judgment does not explicitly detail the revenue's specific arguments beyond this general suggestion.

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

CWP-32231-202 121 IN TH ANIL SHARM INCOME TA

CORAM: H

H Present: M

M M M f

SANJEEV P

1.

Both th petition No.215 decided No.157 and oth held as b i 24 (O&M) Page 1 of 3 HE HIGH COURT OF PUNJA CHANDIGAR

MA Vs.

AX OFFICER AND OTHERS **** HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN **** Mr. Kartik Bansal, Advocate for Mr. Saurabh Kapoor, Sr. Standin Ms. Pridhi Sandhu, Jr. Standing C Ms. Muskaan Gupta, Advocate for the respondents/Revenue. **** RAKASH SHARMA, J.(Oral) he counsel are ad idem that the n stands finally examined and co 509 of 2023 titled as Jasjit Singh d on 29.07.2024, and by the 745 of 2024 titled as Jatinder Sin hers, decided on 19.07.2024. Th under: “16. We are in agreemen by the Coordinate Bench and hol nstructions by the Board could n AB AND HARYANA AT RH CWP-32231-2024 (O&M) Date of Decision: 17.12.2024 . . . . Petitioner . . . . Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH the petitioner. ng Counsel with Counsel ) e issue involved in the present oncluded by this Court in CWP h vs. Union of India and others, e Coordinate Bench in CWP ngh Bhangu vs. Union of India his Court in Jasjit Singh (supra) nt with the view taken ld that such circular or not have been issued to

) 4 r s t P , P a ) MOHIT GOYAL 2024.12.18 11:44 I attest to the accuracy and integrity of this document

CWP-32231-202 o o i m S S a s a t a s i n s w C u i a A p d 3 f a t 24 (O&M) Page 2 of 3 override statutory provisions or t obsolete. Legislative enactmen mplications are required to be 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 mplementation. 17. In view of the aforesa no occasion to distinguish or ta suggested by the learned counse what has already been held by th 18. Keeping in view the Coordinate Bench (supra), notic under Section 148 of the Act, 196 nitiated thereafter without con assessment as envisaged under Act, 1961, have been found to 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-reven at liberty to follow the procedur the Act, 1961 and proceed accord to make them otiose or nts having financial followed strictly and 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 aid discussion, there is ake a different view as el for the revenue from he Coordinate Bench. law laid down by the ces issued by the JAO 61 and the proceedings nducting the faceless r Section 144B of the o be contrary to the d accordingly notices 23, 20.03.2024 and 03.2023, are set aside nue would be, however, re as laid down under dingly, if so advised.

MOHIT GOYAL 2024.12.18 11:44 I attest to the accuracy and integrity of this document

CWP-32231-202 i w 2. Keepin terms. mutand issued Jurisdic proceed 3. All pen

December 17, Mohit goyal 1. Whethe 2. Whethe 24 (O&M) Page 3 of 3 20. All the writ petition nterim order passed by the Cou with the present order.”

ng in view above, we allow this The observations and order pa dis to the present case. Accord under Section 148 of the ctional Assessing Officer as dings are set aside. nding applications also stand disp

(SANJ 2024 r speaking/reasoned?

Y r reportable?

Y ns are allowed. The urt shall stand merged s Writ Petition in the aforesaid assed above shall apply mutatis dingly, notice dated 31.03.2024 Income Tax Act, 1961 by s well as the consequential posed of accordingly. JEEV PRAKASH SHARMA) JUDGE

(SANJAY VASHISTH) JUDGE Yes/No Yes/No

d s 4 y l MOHIT GOYAL 2024.12.18 11:44 I attest to the accuracy and integrity of this document

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