Authority: High Court of Punjab and Haryana at Chandigarh

Order Date: 09 September 2024

Case Overview

  • Parties: Petitioners – OM Satya Overseas, Karnal, represented through partner Ajay Kumar Gupta (Gupta Overseas, Karnal). Respondent – Union of India, Secretary, Ministry of Finance, Department of Revenue, New Delhi.
  • Counsel: For petitioners – Mr. Gurdeep Singh and Mr. Udit Jain, Advocates. For respondents – Senior Advocate Sanjay Bansal, assisted by Ms. Gauri Neo Rampal, Senior Standing Counsel.
  • Bench: Hon'ble Mr. Justice Sanjeev Prakash Sharma and Hon'ble Mr. Justice Sanjay Vashisht.
  • Nature of Proceeding: Writ petition (CWP‑22671) challenging notices issued by the Assessing Officer under Section 148 of the Income Tax Act, 1961, alleging lack of faceless assessment as mandated by Section 144B.
  • Legal Precedents Cited:
  • Jasjit Singh vs. Union of India (No.21509 of 2023), decided 29 July 2024.
  • Jatinder Singh Bhangu vs. Union of India (2024), decided 19 July 2024.
  • The Court reiterated the view that circulars or instructions cannot override statutory provisions and must merely supplement them.
  • Statutory Provisions Discussed: Sections 119, 120 of the Income Tax Act, 1961; Section 144B (sub‑sections 7 & 8) concerning faceless assessment; Section 148 concerning issuance of notices.
  • Observations: The Court held that the revenue department’s circulars/instructions that bypass statutory requirements cause hardship to assessees and create confusion. Such circulars are permissible only to supplement, not to supplant, the law.

Final Outcome

  • The notices issued by the Assessing Officer dated 28‑02‑2023, 16‑03‑2023, 20‑03‑2024, 30‑03‑2023 and the order dated 30‑03‑2023 are set aside for want of jurisdiction as they were issued without the faceless assessment mandated by Section 144B.
  • The notice dated 31‑08‑2024 issued under Section 148 is also set aside.
  • All pending applications related to the writ petition are disposed of.
  • The interim order previously passed by the Court stands merged with the present order.
  • Consequently, the writ petition is allowed in its entirety.

Topics: Tax Assessment, Income Tax Law