Vipin Kumar Gupta Vs ITO (Punjab and Haryana High Court)
The Punjab and Haryana High Court, in the case of Vipin Kumar Gupta vs. ITO, addressed the validity of proceedings initiated under Section 148 of the Income Tax Act, 1961, without adhering to the faceless assessment mechanism mandated under Section 144B. The Court relied on its earlier judgments, including the case of Jasjit Singh vs. Union of India, decided on July 29, 2024, where it was held that circulars or instructions issued by the Central Board of Direct Taxes (CBDT) cannot override or dilute statutory provisions. The High Court emphasized that legislative enactments, especially those with financial implications, must be strictly and mandatorily followed.
In the Jasjit Singh case, the Court had ruled that notices issued and proceedings initiated without conducting faceless assessments under Section 144B were contrary to the Income Tax Act’s provisions. Consequently, such notices and orders were deemed invalid for lack of jurisdiction. The Court reiterated that while CBDT circulars can supplement statutory provisions, they cannot replace or render them obsolete. Tax authorities were directed to comply with statutory mandates to ensure fairness and avoid confusion among taxpayers.
Applying the principles established in Jasjit Singh, the Court set aside the notice dated March 15, 2024, and all consequential proceedings initiated by the Jurisdictional Assessing Officer under Section 148 of the Act. It granted liberty to the revenue authorities to proceed afresh in compliance with the prescribed procedures under the Income Tax Act. This judgment underscores the judiciary’s insistence on adherence to procedural mandates, safeguarding taxpayers’ rights against arbitrary actions by tax authorities.
