JEETMOHINDER SINGH SIDHU vs. NATIONAL FACELESS ASSESSMENT CENTRE AND OTHERS

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CWP/32872/2024HC Punjab & HaryanaPHHC01168721202405 December 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE SANJAY VASHISTH3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that circulars or instructions issued by the Board could not override statutory provisions or render them obsolete. Legislative enactments with financial implications must be strictly followed. The Court found that authorities, by exercising powers under Sections 119 and 120 of the Act, 1961, and Section 144B (7 & 8), cannot usurp legal provisions for their convenience, causing hardship to assessees and confusion for taxpayers. Instructions and circulars are meant to supplement statutory provisions and aid their implementation. Following the precedent set in Jasjit Singh (supra) and Jatinder Singh Bhangu (supra), the Court concluded that notices issued by the JAO under Section 148 and subsequent proceedings, initiated without conducting the faceless assessment under Section 144B, were contrary to the Act. Accordingly, the notices dated 28.02.2023, 16.03.2023, 20.03.2024, and 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 prescribed procedure if advised. The writ petition was allowed in these terms, with the notice issued by the JAO under Section 148 dated 08.04.2024 and consequential proceedings being set aside.

What were the facts?

The petitioner, Jeetmohinder Singh Sidhu, challenged notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The petitioner argued that these actions were taken without conducting a faceless assessment as envisaged under Section 144B of the Act. The revenue accepted that the issue was settled by previous judgments of the same court. The High Court was considering the substantial issue involved in the present petition, which was stated to be finally examined and concluded in prior writ petitions, specifically CWP No. 21509 of 2023 (Jasjit Singh vs. Union of India and others) decided on 29.07.2024, and CWP No. 1574745 of 2024 (Jatinder Singh Bhangu vs. Union of India and others) decided on 19.07.2024.

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 a faceless assessment as envisaged under Section 144B of the Act, are valid and in accordance with law? (Mixed question of law and fact, turning on Sections 148 and 144B of the Income Tax Act, 1961). Assessee's contention: The notices and proceedings are invalid because they were initiated without adhering to the mandatory faceless assessment procedure prescribed under Section 144B of the Act. The petitioner relied on the decisions in Jasjit Singh vs. Union of India and others and Jatinder Singh Bhangu vs. Union of India and others. Revenue's contention: The revenue did not present any distinct arguments against the petitioner's claim, having accepted that the substantial issue was already decided by coordinate benches of the High Court.

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

114

Jeetmohinder

National Face CORAM: H

Present: M

SANJEEV P 1.

N 2.

M behalf of the r 3.

L issue involved by this Court India and oth CWP No.1574 and others, de under: “ B c IN THE HIGH COURT OF PUN AT CHANDIGA C D Singh Sidhu

Vs. eless Assessment Centre and othe

HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN Mr. Gurmohan Singh Bedi, Advo

*** RAKASH SHARMA, J.(Oral) Notice of motion. Mr. Saurabh Kapoor, Sr. Stand revenue. Learned counsel for the parties d in the present petition stands f in CWP No.21509 of 2023 title hers, decided on 29.07.2024, an 745 of 2024 titled as Jatinder Sin ecided on 19.07.2024. This Cour “16. We are in agreement with th Bench and hold that such circul could not have been issued to ove NJAB AND HARYANA ARH CWP-32872-2024 (O&M) Date of Decision: 05.12.2024

…Petitioner ers …Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH ocate for the petitioner. ) ding Counsel, accepts notice on are ad idem that the substantial finally examined and concluded ed as Jasjit Singh vs. Union of nd by the Coordinate Bench in ngh Bhangu vs. Union of India rt in Jasjit Singh (supra) held as he view taken by the Coordinate lar or instructions by the Board erride statutory provisions or to

n l d f n a s e d

RAJESH KUMAR 2024.12.05 16:53 I attest the accuracy and authenticity of this order/judgment.

[2] CWP-32872-2024 (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. RAJESH KUMAR 2024.12.05 16:53 I attest the accuracy and authenticity of this order/judgment.

[3] CWP-32872-2024 (O&M)

20.

All the writ petitions are allowed. The interim order passed by the Court shall stand merged with the present order.”

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 08.04.2024 and all consequential proceedings are set aside. 5.

All pending applications also stand disposed of accordingly.

(SANJEEV PRAKASH SHARMA) JUDGE

(SANJAY VASHISTH)

JUDGE 05.12.2024 rajesh 1. Whether speaking/reasoned? : Yes/No 2. Whether reportable?

: Yes/No RAJESH KUMAR 2024.12.05 16:53 I attest the accuracy and authenticity of this order/judgment.

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