PINKI vs. UNION OF INDIA AND OTHERS

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CWP/34844/2024HC Punjab & HaryanaPHHC01181149202420 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 notices issued under Section 148 of the Income Tax Act, 1961, and all consequential proceedings initiated without conducting faceless assessment as envisaged under Section 144B of the Act, are contrary to the provisions of the Act and are therefore set aside. The Court relied on its previous decision in Jasjit Singh vs. Union of India, which held that circulars or instructions cannot override statutory provisions or render them otiose. The Court emphasized that legislative enactments with financial implications must be followed strictly. The Court found that the notices issued by the Jurisdictional Assessing Officer (JAO) were contrary to the Act and accordingly, the notices dated 20.03.2024, 23.03.2024, 16.03.2023, 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 if so advised. All pending applications were also disposed of.

What were the facts?

The petitioner, Pinki, is challenging notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The petitioner argues that these proceedings were initiated without adhering to the faceless assessment scheme mandated by Section 144B of the Act. The revenue, represented by the Income Tax Department, accepted notice. The High Court noted that similar issues had been decided by coordinate benches in previous cases, specifically Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India. These prior judgments dealt with the validity of faceless assessment procedures and the overriding effect of statutory provisions over administrative instructions.

What were the issues?

1. Whether notices issued 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 valid and not contrary to the provisions of the Act? Assessee's contention: The assessee contends that the notices and subsequent proceedings are invalid because they were not conducted through the faceless assessment mechanism prescribed by Section 144B of the Income Tax Act, 1961. The petitioner relies on the principle that administrative instructions cannot override statutory provisions and that legislative enactments with financial implications must be followed mandatorily. Revenue's contention: The revenue, through its Senior Standing Counsel, accepted notice and did not present any arguments against the petitioner's claims. The judgment notes that the counsel for the revenue was present but does not record any specific arguments made by them.

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

120 IN TH PINKI

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 m S HE HIGH COURT OF PUNJA CHANDIGAR

CWP-3 Date of

V NDIA AND OTHERS HON'BLE MR. JUSTICE SANJ HON'BLE MR. JUSTICE SANJ

Mr. Sunil K. Mukhi, Advocate fo Ms. Urvashi Dhugga, Senior Stan for the respondent/Income Tax D ***** RAKASH SHARMA, J. (Oral) Notice of motion. Ms. Urvashi Dhugga, Senior St 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 mandatorily. By exercising the Sections 119 and 120 of the A AB AND HARYANA AT RH 34844-2024 (O&M) f Decision:20.12.2024

..…...Petitioner(s) V/s. …......Respondent(s) NJEEV PRAKASH SHARMA NJAY VASHISTH or the petitioner. nding Counsel, Department. tanding 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 powers contained in Act, 1961 as well as

e e P , f , Suresh Kumar 2025.01.08 13:15 I attest to the accuracy and integrity of this document

CWP-34844-202

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 mutandis to (Annexure P- 024 (O&M) Page 2 of 3

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 the present case. According -4) issued by the Jurisdictional A 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 gly, notice dated 20.03.2024 Assessing Officer u/s 148 of the e s 4 e Suresh Kumar 2025.01.08 13:15 I attest to the accuracy and integrity of this document

CWP-34844-202

Income Tax aside. 5. A

December 20 Ess Kay

Whether speak Whether Repor 024 (O&M) Page 3 of 3

Act, 1961 and all consequenti All pending applications also stan [SANJEEV 0, 2024

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king / reasoned :

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Y ial proceedings thereof are set nd disposed of accordingly.

V PRAKASH SHARMA] JUDGE

NJAY VASHISTH] JUDGE Yes / No Yes / No t Suresh Kumar 2025.01.08 13:15 I attest to the accuracy and integrity of this document

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