GULSHAN ARORA vs. INCOME TAX OFFICER AND OTHERS

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CWP/8987/2025HC Punjab & HaryanaPHHC01050329202528 March 2025Bench: MR. JUSTICE ARUN PALLI,MRS. JUSTICE SUDEEPTI SHARMA2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court allowed the writ petition, disposing of it in terms of previous judgments by a Co-ordinate Bench in Jatinder Singh Bhangu vs. Union of India and others (CWP No. 15745-2024) and Jasjit Singh vs. Union of India and others (CWP No. 21509-2023). In those cases, the writ petitions were allowed on similar issues, with liberty granted to the revenue to follow the prescribed procedure under the Act, 1961, and proceed accordingly if advised. The reasoning implicitly accepted the petitioner's argument regarding the jurisdictional defect in issuing the Section 148 notice, as per the CBDT circular. The operative direction was to dispose of the petition in line with the precedents, implying that the revenue would need to re-initiate proceedings correctly. No issue was expressly left undecided.

What were the facts?

The petitioner, Gulshan Arora, challenged several notices and an assessment order for Assessment Year (AY) 2020-2021. These included a notice dated 19.02.2024 under Section 148 of the Income Tax Act, 1961; an assessment order dated 24.02.2025 under Section 147 read with Section 144 and 144-B; a demand notice dated 24.02.2025 under Section 156; and a penalty show cause notice dated 24.02.2025 under Section 270-A. The petitioner argued that the issuing authority lacked jurisdiction due to a CBDT circular dated 29.03.2022, which purportedly granted exclusive power to the National Faceless Assessment Centre (NFAC) to issue Section 148 notices. The revenue did not dispute this contention.

What were the issues?

1. Whether the notice dated 19.02.2024 issued under Section 148 of the Income Tax Act, 1961, and consequential actions for AY 2020-2021 are invalid due to lack of jurisdiction by the issuing authority, in light of the CBDT circular dated 29.03.2022, which allegedly vests exclusive power in the NFAC to issue such notices? (Question of law and fact, concerning Section 148 of the Act, 1961 and CBDT Circular dated 29.03.2022). Assessee's Contention: The petitioner argued that the issuing authority lacked jurisdiction to issue the impugned notices and order, citing the CBDT circular dated 29.03.2022, which purportedly stated that the NFAC has exclusive power to issue notices under Section 148 of the Act, 1961. Revenue's Contention: The learned counsel for the Union of India did not dispute the petitioner's contention.

Which sections of the Income-tax Act were involved?

Section 148,Section 147,Section 144,Section 144-B,Section 156,Section 270-A

AI-generated summary — verify with the full judgment below

CWP-8987-2025 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 181 CWP-8987-2025 (O&M) Date of Decision:-28.03.2025 Gulshan Arora

....Petitioner Vs. Income Tax Officer, Ward 5(1), Ludhaiana & ors. ...Respondents CORAM: HON'BLE MR. JUSTICE ARUN PALLI HON'BLE MRS. JUSTICE SUDEEPTI SHARMA Present: Mr. B.M. Monga, Mr. Rohit Kaura and Mr. Rajiv Sharma, Advocates for the petitioner. Mr. Ranvijay Singh, Sr. Standing counsel for the respondent. *** SUDEEPTI SHARMA, J. 1. Challenge in the instant writ petition is to notice dated 19.02.2024 issued under Section 148 of the Income Tax Act, 1961 (for short “Act 1961”); impugned assessment order dated 24.02.2025 issued under Section 147 read with Section 144 read with Section 144-B of the Act, 1961; notice of demand dated 24.02.2025 issued under Section 156 of the Act, 1961; penalty show cause notice dated 24.02.2025 issued under Section 270-a of the Act, 1961 and consequential actions, for AY 2020-2021. 2. Learned counsel for the petitioner contends that the issue involved in the present writ petition is covered by the judgment passed by a Co-ordinate Bench of this Court in the cases of Jatinder Singh Bhangu vs. Union of India and others, passed in CWP No. 15745-2024 and connected matter, decided on 19.07.2024 and Jasjit Singh vs. Union of India and others (CWP No. 21509- 2023 and other connected matters), decided on 29.07.2024 . 3. Learned counsel appearing for Union of India has also not Gaurav Arora 2025.04.03 15:21 I attest to the accuracy and integrity of this document

CWP-8987-2025 2 disputed the same. 4. We have heard learned counsel for the parties and perused the whole records of the case. 5. The petitioner has challenged the notice dated 19.02.2024 issued under Section 148 of the Act, 1961; impugned assessment order dated 24.02.2025 issued under Section 147 read with Section 144 read with Section 144-B of the Act, 1961; notice of demand dated 24.02.2025 issued under Section 156 of the Act, 1961; penalty show cause notice dated 24.02.2025 issued under Section 270-a of the Act, 1961 and consequential actions, for AY 2020-2021, on the ground that the Issuing Authority had no jurisdiction to issue the same, in view of the circular/notification dated 29.03.2022 of the CBDT, wherein, it has been specifically enumerated that the NFAC has exclusive power to issue the notice under Section 148 of the Act, 1961. 6. A Co-ordinate Bench of this Court in Jatinder Singh Bhangu’s case (supra) and Jasjit Singh’s case (supra), allowed the writ petitions on the same issue, as raised in the present writ petition, by granting liberty to the revenue to follow the procedure as laid down under the Act, 1961 and proceed accordingly, if so advised. 7. In view of the above, the present writ petition is disposed of, in terms of Jatinder Singh Bhangu’s case (supra), decided on 19.07.2024 and Jasjit Singh’s case (supra), decided on 29.07.2024 8. All the pending applications, if any, also stand disposed of. (ARUN PALLI) (SUDEEPTI SHARMA) JUDGE JUDGE 28.03.2025

Gaurav Arora

Whether speaking/reasoned : Yes/No Whether reportable : Yes/No Gaurav Arora 2025.04.03 15:21 I attest to the accuracy and integrity of this document

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