2023 (7) TMI 1050 - HC - Income Tax

Jurisdiction of rectification notice issued u/s 154 by the Income Tax Officer - authority competent to issue notices - HELD THAT - It is not in issue that assessment order in this case has been passed by the National Faceless Assessment Center. The notice for rectification has now been issued by the Income Tax Officer, who is the competent authority otherwise for passing the order of assessment. Section 157A refers to rectification where the assessment is done by the National Faceless Assessment Center. Section 157A is clearly an enabling provision which permits the Central Government to make a scheme, by notification in the official gazette, for the purposes of rectification of any mistake apparent from record u/s 154 of the Act. However, our attention has not been invited to any specific scheme framed by the Central Government u/s 157A which specifies any other authority as being the competent authority to initiate rectification proceedings. In the absence of any such scheme having been produced before the Court, we are not inclined to accept the petitioner's contention that the jurisdictional authority, i.e. the Income Tax Officer ceases to have jurisdiction to issue the rectification notice. Leaving it open for the petitioner to respond to notice and raise available arguments in that regard, this petition is consigned to records.

Summary

Issues involved:
The jurisdiction of the Income Tax Officer to issue a rectification notice under Section 154 of the Income Tax Act, in light of the amendment introducing Section 157A for faceless assessment proceedings.

Judgment Summary:

The petitioner challenged a rectification notice issued under Section 154 of the Income Tax Act, arguing that the Income Tax Officer lacked jurisdiction to issue such a notice. The petitioner contended that the Act's amendment, specifically Section 157A, introduced a scheme for rectification in faceless assessment proceedings by the Central Government, designating a specific authority to issue rectification notices. The petitioner claimed that since the assessment was conducted by the National Faceless Assessment Center, only the Center had the jurisdiction to issue rectification notices.

The respondent, representing the revenue, countered the petitioner's argument by asserting that Section 157A is an enabling provision allowing the Central Government to create a scheme for rectification, but until a specific scheme designating another authority is produced, the Income Tax Officer remains the competent authority for rectification proceedings as per Section 116 of the Act.

The Court noted that the assessment in question was conducted by the National Faceless Assessment Center, and Section 157A is relevant in such cases. However, since no scheme specifying an alternate authority for rectification was presented, the Income Tax Officer retained jurisdiction to issue the rectification notice. The Court emphasized that the petitioner could raise jurisdictional issues in response to the notice, and those issues would be addressed by the relevant authority.

In conclusion, the Court allowed the petitioner to respond to the rectification notice and present arguments regarding jurisdiction, ensuring that any challenges to the notice would be handled according to the law. The petition was archived, leaving room for the petitioner to address the notice and raise appropriate arguments.