KIRAN GUPTA vs. UNION OF INDIA AND OTHERS

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CWP/9519/2023HC Punjab & HaryanaPHHC01056833202304 October 2024Bench: MR. JUSTICE SANJEEV PRAKASH SHARMA,MR. JUSTICE ALOK JAIN3 pages
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What did the High Court hold?

The Tribunal held that circulars or instructions issued by the Board cannot override statutory provisions or render them obsolete. Legislative enactments with financial implications must be strictly followed. The authorities, by exercising powers under Sections 119 and 120 of the Act, as well as Section 144B(7 & 8), cannot usurp legal provisions for their convenience, causing hardship to assessees and confusion. Instructions and circulars can only supplement statutory provisions and aid in their implementation. Consequently, notices issued by the JAO under Section 148 of the Act and proceedings initiated thereafter, without conducting the faceless assessment as envisaged under Section 144B, were found to be contrary to the Act. The notices dated 28.02.2023, 16.03.2023, 20.03.2024, and 30.03.2023, along with 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 if so advised. The present writ petition was allowed in terms of the previous judgments, and the notice dated 07.04.2023 and all consequential proceedings were set aside.

What were the facts?

The petitioner, Kiran Gupta, filed a writ petition challenging notices issued under Section 148 of the Income Tax Act, 1961, and subsequent proceedings. The petitioner sought to amend the writ petition to include averments relating to the invocation of powers by the Jurisdictional Assessing Officer (JAO) under Section 148 after the introduction of the faceless assessment regime. The revenue, represented by the Union of India, accepted notice. The parties agreed that the substantial issue had been decided in previous cases by the same court. The court noted that the notices were issued by the JAO under Section 148 without conducting the assessment as envisaged under Section 144B of the Act.

What were the issues?

1. Whether notices issued by the Jurisdictional Assessing Officer under Section 148 of the Income Tax Act, 1961, and subsequent proceedings are valid when faceless assessment, as envisaged under Section 144B of the Act, was not conducted? The assessee argued that the notices and proceedings were contrary to the provisions of the Act because the faceless assessment procedure was not followed. The assessee relied on previous judgments of the High Court, specifically CWP No. 21509 of 2023 (Jasjit Singh vs. Union of India) and CWP No. 15745 of 2024 (Jatinder Singh Bhangu vs. Union of India), which dealt with similar issues concerning the validity of notices issued under Section 148 in the context of the faceless assessment regime. The revenue contended that the circulars or instructions issued by the Board could override statutory provisions or make them otiose. The revenue suggested that the court should distinguish the present case from the previously decided ones.

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

124

I Kiran Gupta

Union of Indi

CORAM: H

Present M

SANJEEV P CM-16149-C 1.

A relating to in Section 148 o assessment. 2.

I allowed. Ame today. CWP-9519-2 3.

N 4.

M behalf of the r IN THE HIGH COURT OF PUN AT CHANDIGA C C D

Vs. a and Others

HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE ALO Mr. Sandeep Goyal, Advocate fo Ms. Gauri Neo Rampal, Sr. Stand

(through video conf ***

RAKASH SHARMA, J.(Oral) CWP-2024 Application has been moved for nvoking powers by the Jurisdic of the Income Tax Act, 1961, a In view of the averments made ended writ petition is taken on 2023 (O&M) Notice of motion. Ms. Gauri Neo Rampal, Sr. Stan revenue. NJAB AND HARYANA ARH CM-16149-CWP-2024 in/and CWP-9519-2023 (O&M) Date of Decision: 04.10.2024

…Petitioner

…Respondents NJEEV PRAKASH SHARMA OK JAIN or the petitioner. ding Counsel for the revenue ferencing). ) amendment of the writ petition ctional Assessing Officer under after the new regime of faceless in the application, the same is n record and is taken on board nding Counsel accepts notice on n r s s d n RAJESH KUMAR 2024.10.14 12:40 I attest to the accuracy and authenticity of this order/judgment. Punjab & Haryana High Court, Chandigarh.

[2]

CWP-9519-2023 (O&M)

Learned counsel for the parties are ad idem that the substantial issue involved in the present petition stands finally examined and concluded by this Court in CWP No.21509 of 2023 titled as Jasjit Singh vs. Union of India and others, decided on 29.07.2024, and by the Coordinate Bench in CWP No.15745 of 2024 titled as Jatinder Singh Bhangu vs. Union of India and others, decided on 19.07.2024. This Court in Jasjit Singh (supra) held as under: “16. We are in agreement with the view taken by the Coordinate Bench and hold that such circular or instructions by the Board could not have been issued to override statutory provisions or to 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, RAJESH KUMAR 2024.10.14 12:40 I attest to the accuracy and authenticity of this order/judgment. Punjab & Haryana High Court, Chandigarh.

[3]

CWP-9519-2023 (O&M)

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. 20. All the writ petitions are allowed. The interim order passed by the Court shall stand merged with the present order.” 6.

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 07.04.2023 and all consequential proceedings are set aside. 7.

All pending applications also stand disposed of accordingly.

(SANJEEV PRAKASH SHARMA) JUDGE

(ALOK JAIN)

JUDGE 04.10.2024 rajesh

1.

Whether speaking/reasoned? : Yes/No 2. Whether reportable?

: Yes/No RAJESH KUMAR 2024.10.14 12:40 I attest to the accuracy and authenticity of this order/judgment. Punjab & Haryana High Court, Chandigarh.

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