KHANNA PAPER MILLS LTD. V. ASSISTANT/DEPUTY COMMISSIONER OF INCOME TAX, CIRLCE-1, AMRITSAR

CWP/9299/2023

AI Insights

The case involves Khanna Paper Mills Ltd. challenging the notices issued by the Assistant/Deputy Commissioner of Income Tax under Section 148 of the Income Tax Act, 1961. The core issue was the jurisdiction of the Assessing Officer to issue these notices in light of the faceless assessment provisions introduced by the Finance Act, 2021. The petitioners argued that the legal framework and previous judgments, particularly the judgments in Jasjit Singh vs. Union of India and Jatinder Singh Bhangu vs. Union of India, supported their position that such notices were not within the jurisdiction of the Assessing Officer under the new regime. The court agreed with this interpretation, setting aside the notices and proceedings for being contrary to the statutory provisions of the Act.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 678853 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 12-09-2023
• Assessment Year: misc
• Other Referred Cases: Jasjit Singh vs. Union of India, Jatinder Singh Bhangu vs. Union of India
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: URVASHI DHUGGA
• Assessee Lawyers: ABHINAV NARANG
• Keywords: Assessment; Faceless regime; Income Tax; Jurisdiction; Notices
• Section: 148; 119; 144B; 120

Judgement Text

"CWP-9299-2023 104+239 IN THE HIGH COURT OF PUNJAB AND HARYANA AT 1. KHANNA PAPER MILLS LTD. ASSISTANT/DEPUTY COMMISSIONER OF INCOME AMRITSAR 2. KHANNA PAPER MILLS LTD. ASSISTANT/DEPUTY COMMISSIONER OF INCOME TAX, CIRLCE AMRITSAR CORAM: HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON’BLE MR. JUSTICE Present: Mr Mr for the SANJEEV PRAKASH SHARMA, J.(Oral) CM-14944-CWP Application annexures on behalf of respondents Registry to place the same at appropriate place. 2023 (O&M) and connected case Page 1 of 4 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH KHANNA PAPER MILLS LTD. Vs. ASSISTANT/DEPUTY COMMISSIONER OF INCOME **** KHANNA PAPER MILLS LTD. Vs. ASSISTANT/DEPUTY COMMISSIONER OF INCOME TAX, CIRLCE **** Date of Decision: 12.09 **** HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON’BLE MR. JUSTICE SANJAY VASHISTH **** Mr. Abhinav Narang, Advocate for the petitioner Mrs. Urvashi Dhugga, Sr. Standing Counsel for the respondents/Revenue. **** PRAKASH SHARMA, J.(Oral) CWP-2024 and CM-14964-CWP-2024 Applications for placing on record written statement on behalf of respondents are allowed. Registry to place the same at appropriate place. IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-9299-2023 (O&M) . . . . Petitioner ASSISTANT/DEPUTY COMMISSIONER OF INCOME TAX, CIRLCE-1, . . . . Respondent CWP-9285-2023 (O&M) . . . . Petitioner ASSISTANT/DEPUTY COMMISSIONER OF INCOME TAX, CIRLCE-1, . . . . Respondent .09.2024 HON’BLE MR. JUSTICE SANJEEV PRAKASH SHARMA SANJAY VASHISTH , Advocate for the petitioners. Sr. Standing Counsel PRAKASH SHARMA, J.(Oral) 2024 for placing on record written statements along with allowed. Registry to place the same at appropriate place. (O&M) Petitioner . . . . Respondent . . . . Petitioner . . . . Respondent s along with MOHIT GOYAL 2024.09.13 11:07 I attest to the accuracy and integrity of this document CWP-9299-2023 Main cases 1. Learned counsel for the petitioners has submitted that legal argument has not been raised in the petitions, but he submits that the issue stands covered by the judgment passed by this Court in No.21509 of 2023 titled as Jasjit Singh vs. Un decided on 29.07.2024 No.15745 of 2024 titled as Jatinder Singh Bhangu vs. Union of India and others 2. This Court Assessing Officer would not be competent to issue notice under Section 148 of the Income Tax Act, 1961 in view of the Faceless regime. 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 sa 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 2023 (O&M) and connected case Page 2 of 4 Learned counsel for the petitioners has submitted that legal argument has not been raised in the petitions, but he submits that the issue stands covered by the judgment passed by this Court in No.21509 of 2023 titled as Jasjit Singh vs. Un decided on 29.07.2024, and by the Coordinate Bench in No.15745 of 2024 titled as Jatinder Singh Bhangu vs. Union of India and others, decided on 19.07.2024. Court Jasjit Singh (supra) has held that the Jurisdictional Assessing Officer would not be competent to issue notice under Section 148 of the Income Tax Act, 1961 in view of the Faceless regime. This Court in Jasjit Singh (supra) “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 Learned counsel for the petitioners has submitted that although the legal argument has not been raised in the petitions, but he submits that the issue stands covered by the judgment passed by this Court in CWP No.21509 of 2023 titled as Jasjit Singh vs. Union of India and others, and by the Coordinate Bench in CWP No.15745 of 2024 titled as Jatinder Singh Bhangu vs. Union of India has held that the Jurisdictional Assessing Officer would not be competent to issue notice under Section 148 of the Income Tax Act, 1961 in view of the Faceless (supra) held as under: 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 tisfaction 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 although the legal argument has not been raised in the petitions, but he submits that CWP , CWP No.15745 of 2024 titled as Jatinder Singh Bhangu vs. Union of India has held that the Jurisdictional Assessing Officer would not be competent to issue notice under Section 148 of the Income Tax Act, 1961 in view of the Faceless MOHIT GOYAL 2024.09.13 11:07 I attest to the accuracy and integrity of this document CWP-9299-2023 supplementing the statutory provisions and implementation. 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. 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 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. at the Act, 1961 and proceed accordingly, if so advised. interim order passed by the Court shall stand merged with the present order.” 3. Learned counsel for the arguments not being taken up in the petitions, but candidly accepts that the factual position is what as was stated by learned counsel for the petitioners, and it would be covered by the judgment of this Court in Jasjit Singh 2023 (O&M) and connected case Page 3 of 4 supplementing the statutory provisions and 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. 20. All the writ petitions are allowed. The interim order passed by the Court shall stand merged with the present order.” Learned counsel for the Revenue though objects on the ground of arguments not being taken up in the petitions, but candidly accepts that the factual position is what as was stated by learned counsel for the petitioners, and it would be covered by the judgment of this Court in jit Singh (supra). supplementing the statutory provisions and for their 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. 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 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 revenue would be, however, 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 though objects on the ground of arguments not being taken up in the petitions, but candidly accepts that the factual position is what as was stated by learned counsel for the petitioners, and it would be covered by the judgment of this Court in though objects on the ground of arguments not being taken up in the petitions, but candidly accepts that the factual position is what as was stated by learned counsel for the petitioners, and it would be covered by the judgment of this Court in MOHIT GOYAL 2024.09.13 11:07 I attest to the accuracy and integrity of this document CWP-9299-2023 4. Keeping in view above, terms. The observations and order passed above shall apply mutandis Jurisdictional Assessing Officer CWP-9299 CWP-9285 and set aside. 5. All pending applications also stand disposed of accordingly. September 12 Mohit goyal 1. Whether speaking/reasoned? 2. Whether reportable? 2023 (O&M) and connected case Page 4 of 4 Keeping in view above, we allow these terms. The observations and order passed above shall apply mutandis to the present cases. Accordingly, Jurisdictional Assessing Officer under Section 148 9299-2023 and notice under Section 9285-2023 as well as the consequential proceedings set aside. All pending applications also stand disposed of accordingly. (SANJEEV , 2024 1. Whether speaking/reasoned? Yes/No 2. Whether reportable? Yes/No these Writ Petitions in the aforesaid terms. The observations and order passed above shall apply mutatis Accordingly, notice issued by under Section 148 dated 10.04.2023 in under Section 148 dated 07.04.2023 in consequential proceedings are quashed All pending applications also stand disposed of accordingly. SANJEEV PRAKASH SHARMA) JUDGE (SANJAY VASHISTH) JUDGE Yes/No Yes/No in the aforesaid mutatis issued by in in quashed MOHIT GOYAL 2024.09.13 11:07 I attest to the accuracy and integrity of this document "