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2024 (7) TMI 1057 - HC - Income TaxValidity of Faceless assessment of income escaping assessment - Challenge to notice u/s 148 as non-compliance with Section 151A of the Act - notices issued by JAO instead of FAO - HELD THAT - JAO would not have jurisdiction to issue the impugned notices more particularly in view of the clear provisions of Section 151A read with notification dated 29 March, 2022 issued by the Central Government. As fairly conceded on behalf of the revenue, the challenge in the proceedings would stand covered by the decision of this Court in Hexaware Technologies Ltd. ( 2024 (5) TMI 302 - BOMBAY HIGH COURT . The impugned notices would be required to be held to be illegal and invalid as and there is no dispute that the JAO had no jurisdiction to issue the impugned notice. We, accordingly, allow this petition in favour of assessee.
Issues:
Challenge to notice under Section 148 of the Income Tax Act, 1961 for reassessment for the Assessment Year 2020-21. Non-compliance with Section 151A of the Act regarding issuance of notice by Jurisdictional Assessing Officer instead of Faceless Assessing Officer. Analysis: The Writ Petition was filed to challenge a notice issued under Section 148 of the Income Tax Act, 1961, for reassessment for the Assessment Year 2020-21, which was not issued by a Faceless Assessing Officer as required by Section 151A of the Act. The Division Bench in the case of Hexaware Technologies Limited Vs. Assistant Commissioner of Income Tax clarified that the jurisdiction for issuance of notice under Section 148 is exclusive to either the Jurisdictional Assessing Officer (JAO) or the Faceless Assessing Officer (FAO) as per the Scheme dated 29th March 2022. The Scheme mandates automated allocation for randomised case allocation, and only the FAO can issue the notice under Section 148, not the JAO. The Respondent-Revenue's non-compliance with the Scheme notified under Section 151A (2) of the Act was evident, and the Court found the notice invalid due to the failure to follow the faceless assessment procedure. The Court held that the proceedings initiated in violation of the Scheme were vitiated. Both parties agreed that the proceedings under Section 148 would be unsustainable based on the Hexaware judgment. Another decision, Nainraj Enterprises Pvt. Ltd. Vs. The Deputy Commissioner of Income Tax, supported this view, leading to the allowance of the petition due to non-compliance with Section 151A. Consequently, the Court quashed and set aside the impugned notice and order, emphasizing that the JAO lacked jurisdiction to issue the notice. The judgment focused on the non-compliance with Section 151A and did not address other issues raised in the petition, clarifying that it was unnecessary to do so. The Writ Petition was allowed based on the non-compliance grounds, and no costs were awarded in the matter.
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