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2024 (7) TMI 1494 - HC - Income TaxReopening of assessment u/s 147 - Validity of the approval granted under Section 151 - notice not issued by JAO - HELD THAT - There is no question of any concurrent jurisdiction to be exercised by the JAO and the Faceless Assessing Officer ( FAO ) for issuance of notice u/s 148 of the Act or even for passing an assessment or reassessment order. As observed that when the specific jurisdiction has been assigned to the FAO in the Scheme dated 29 March, 2022 notified in pursuance of the said provision, in such event, it excludes the jurisdiction of the JAO. As held that as Section 151A of the Act itself contemplates formulation of the Scheme for both assessment, reassessment or recomputation under Section 147, as well as for issuance of notice u/s 148 of the Act, and that the Scheme framed by the CBDT covered both such aspects of the provisions of Section 151A of the Act. It was observed that the Scheme as framed was clearly applicable for issuance of notice u/s 148 of the Act and accordingly, only the FAO can issue the notice u/s 148 of the Act and not the JAO. In our opinion, there is merit in the contention as raised on behalf of the Petitioner that for the aforesaid reasons, as well, the impugned notice would also be hit by the provisions of Section 151A of the Act insofar as the issuance of notice is by the JAO who has acted without jurisdiction. The impugned notice issued u/s 148 of the Act is quashed and set aside as being barred by limitation and also being contrary to the provisions of Section 151A.
Issues Involved:
1. Legality of the notice issued under Section 148 of the Income Tax Act, 1961. 2. Validity of the approval granted under Section 151 of the Income Tax Act, 1961. 3. Compliance with the provisions of Section 151A regarding faceless assessments. Issue-wise Detailed Analysis: 1. Legality of the Notice Issued Under Section 148: The Petitioner challenged the notice dated 30 June 2021 issued under Section 148 of the Income Tax Act, 1961, for the Assessment Year (AY) 2015-16. The primary contention was that the notice is barred by limitation as per Section 149(1) of the Act, read with the first proviso. The notice was issued on 20 May 2022, after the prescribed period of limitation, which expired on 31 March 2022. The Court referred to the case of Hexaware Technologies Limited, where it was held that for AY 2015-16, the 6th year expired on 31 March 2022, and any notice issued beyond this period is barred by limitation. The Court observed that the term "at that time" in the first proviso to Section 149 refers to the date on which the notice is to be issued by the Assessing Officer. Therefore, the notice issued on 29 July 2022 was clearly beyond the period of limitation. 2. Validity of the Approval Granted Under Section 151: The Petitioner also sought to quash the approval granted under Section 151 of the Act. The Court did not delve deeply into this issue as the primary contention regarding the limitation period under Section 149 was sufficient to decide the case. However, the approval under Section 151 was implicitly questioned as part of the broader challenge to the validity of the notice under Section 148. 3. Compliance with the Provisions of Section 151A Regarding Faceless Assessments: The Petitioner argued that the notice issued by the Jurisdictional Assessing Officer (JAO) was not in consonance with the provisions of Section 151A, which mandates faceless assessments. The Court referred to the decision in Hexaware Technologies Limited, which held that there is no concurrent jurisdiction between the JAO and the Faceless Assessing Officer (FAO) for issuing notices under Section 148. The Scheme framed by the CBDT for faceless assessments applies to the issuance of notices under Section 148, and only the FAO can issue such notices. The notice issued by the JAO was thus held to be without jurisdiction and contrary to the provisions of Section 151A. Conclusion: The Court allowed the Writ Petition, quashing and setting aside the impugned notice dated 29 July 2022 issued under Section 148 of the Act, as it was barred by limitation and contrary to the provisions of Section 151A. The Rule was made absolute, and no costs were awarded.
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