SURESH KUMAR vs. INCOME TAX OFFICER AND OTHERS

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CWP/8989/2025HC Punjab & HaryanaPHHC01050338202528 March 2025Bench: MR. JUSTICE ARUN PALLI,MRS. JUSTICE SUDEEPTI SHARMA2 pages
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What did the High Court hold?

The High Court held that the present writ petition is disposed of in terms of the judgments passed by a Co-ordinate Bench in Jatinder Singh Bhangu vs. Union of India and others (CWP No. 15745-2024), decided on July 19, 2024, and Jasjit Singh vs. Union of India and others (CWP No. 21509-2023), decided on July 29, 2024. In those cases, the writ petitions were allowed on similar issues, with liberty granted to the revenue to follow the procedure laid down under the Act, 1961, and proceed accordingly if so advised. The Court noted that the petitioner had challenged the notices and orders on the ground of lack of jurisdiction by the issuing authority, citing the CBDT circular dated March 29, 2022, which purportedly grants exclusive power to the NFAC to issue Section 148 notices. The revenue did not dispute this contention. Consequently, the present writ petition was disposed of in line with the precedent, implying that the impugned notices and orders were set aside, with the revenue having the option to re-initiate proceedings following the correct procedure.

What were the facts?

The petitioner, Suresh Kumar, challenged a notice dated March 29, 2024, issued under Section 148 of the Income Tax Act, 1961, an assessment order dated March 4, 2025, under Section 147, a demand notice dated March 4, 2025, under Section 156, and a penalty show cause notice dated March 4, 2025, under Section 271 AAC (1), all pertaining to Assessment Year 2020-2021. The core of the challenge was that the issuing authority lacked jurisdiction due to a CBDT circular/notification dated March 29, 2022, which purportedly granted exclusive power to the National Faceless Assessment Centre (NFAC) to issue Section 148 notices. The revenue, represented by the Income Tax Officer, Ward 3, Pkl., and others, did not dispute the petitioner's contention regarding the applicability of prior judgments.

What were the issues?

1. Whether the notice dated March 29, 2024, issued under Section 148 of the Income Tax Act, 1961, the assessment order dated March 4, 2025, under Section 147, the demand notice dated March 4, 2025, under Section 156, and the penalty show cause notice dated March 4, 2025, under Section 271 AAC (1) for AY 2020-2021 are invalid on the ground that the issuing authority lacked jurisdiction, in light of the CBDT circular/notification dated March 29, 2022, which allegedly vests exclusive power to issue Section 148 notices with the NFAC? (Question of law and mixed fact and law, turning on Section 148 and the interpretation of the CBDT circular). Assessee's contention: The issuing authority lacked jurisdiction to issue the impugned notices and orders due to the CBDT circular dated March 29, 2022, which grants exclusive power to the NFAC for issuing Section 148 notices. The petitioner relied on the judgments 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). Revenue's contention: The revenue did not dispute the petitioner's contention.

Which sections of the Income-tax Act were involved?

Section 148,Section 147,Section 156,Section 271 AAC (1)

AI-generated summary — verify with the full judgment below

CWP-8989-2025 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 182 CWP-8989-2025 (O&M) Date of Decision:-28.03.2025 Suresh Kumar

....Petitioner Vs. Income Tax Officer, Ward 3, Pkl. & 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. Saurabh Kapoor, Sr. Standing counsel (Through VC) with Ms. Muskan Gupta, Advocate for the respondent. *** SUDEEPTI SHARMA, J. 1. Challenge in the instant writ petition is to notice dated 29.03.2024 issued under Section 148 of the Income Tax Act, 1961 (for short “Act 1961”); impugned assessment order dated 04.03.2025 issued under Section 147 of the Act, 1961; notice of demand dated 04.03.2025 issued under Section 156 of the Act, 1961; penalty show cause notice dated 04.03.2025 issued under Section 271 AAC (1) 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-8989-2025 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 29.03.2024 issued under Section 148 of the Act, 1961; impugned assessment order dated 04.03.2025 issued under Section 147 of the Act, 1961; notice of demand dated 04.03.2025 issued under Section 156 of the Act, 1961; penalty show cause notice dated 04.03.2025 issued under Section 271 AAC (1) 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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