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TMI Blog2025 (1) TMI 702X X X X Extracts X X X X X X X X Extracts X X X X ..... inued by the jurisdictional assessing officer and the assessment order could have been passed by him in cases where the original notices issued by the jurisdictional assessing officer were treated to have been issued in terms of the new regime? - HELD THAT:- The entire scheme of the Act specifically requires the same assessing officer, who issues notices to conduct an enquiry and considered their reply in terms of Section 148A. Thereafter, the same assessing officer is required to pass an order under the new scheme after giving notice under Section 148 of the old Act. In our considered opinion, if we examine the provisions of present situation, which has arisen on account of treating the notices issued under Section 148 of the Act as notice u/s 148A (b) of the Act, the natural corollary would be that such replies which may be received to the notice issued u/s 148A (b) of the Act, would be examined by the same assessing officer, who had originally issued the notices under the old regime. His jurisdiction cannot be said to have been taken away for examining the reply to notice u/s 148A (b) of the Act. Therefore, as a result the same assessing officer i.e. JAO would be also entitled t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also does not apply to the present bunch of cases. It is made clear that the petitioners relating to the orders passed by the Assessing Officer on merits can be raised in appeal before the appellate authority. If appeals are so filed, the same shall be decided on merits and the delay shall be condoned on account of the fact that the writ petitions are pending before this Court. All the writ petitions are dismissed. - HON BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON BLE MR. JUSTICE SANJAY VASHISTH CWP-18488-2022 (O M), CWP-19085-2022 (O M), CWP-19233-2022 (O M), CWP-19310-2022 (O M), CWP-19347-2022 (O M), . CWP-19480-2022 (O M), CWP-19490-2022 (O M), CWP-19493-2022 (O M), CWP-19538-2022 (O M), CWP-19553-2022 (O M), CWP-19640-2022 (O M), CWP-20228-2022 (O M), CWP-20230-2022 (O M), CWP-20246-2022 (O M), CWP-20253-2022 (O M), CWP-20268-2022 (O M), CWP-20270-2022 (O M), CWP-20274-2022 (O M), CWP-20312-2022 (O M), CWP-20316-2022 (O M), CWP-20340-2022 (O M), CWP-20351-2022 (O M), CWP-20354-2022 (O M), CWP-20506-2022 (O M), CWP-20515-2022 (O M), CWP-20594-2022 (O M), CWP-20604-2022 (O M), CWP-20622-2022 (O M), CWP-20655-2022 (O M), CWP-20734-2022 (O M) , CWP-20750-2022 (O M), CWP-20878-20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P-12105-2023 (O M), CWP-12569-2023 (O M), CWP-12697-2023 (O M), CWP-12699-2023 (O M), CWP-12738-2023 (O M), CWP-12982-2023 (O M), CWP-14752-2023 (O M), CWP-22276-2023 (O M). M/s. Patran Foods Pvt. Ltd., Monika Gupta, Rajiv Aggarwal, Tara Corporation Limited, Pawan Kumar Saraf, Ramita Devi, Hanuman Parsad Saraf, M/s Dharmesh Textiles Ltd., Brij Lal (HUF), Parul, Renu Mittal, Naresh Kumar HUF, Omprakash and Sons HUF, Dimple Gupta, Lalita Bansal, Sunil and Sons HUF, M/s. Batra Rice Mills, Usha Rani, Raj Kumar and Sons HUF, Gajanand, Neetu Mittal, Hitesh Arora, Veena Garg, Sunny Garg, Prem Chand and Company, Sunny Garg, Karan Singh, Hari Ram, Anjani Kumar, Vijay Kumar, M/s Raj Sons, Jitender Kumar, Kay Bee Safal India Ltd., Shree Mahalaxmi Trading Company, Kailash Chand Gupta, Anju Gupta, Rajeev Suneja, Surjit Kumar (HUF) Th. Karta Surjit Kumar Chopra, M/s. TMS Real Estate Pvt. Ltd., Sweeti Kumari, M/s VV International, Krishan Kumar Kasera, Parveen Garg, Kewal Garg, M/s. Kaithal Solvent Private Limited, Gulzar Singh Since Deceased Th. Legal Heir., Lalita Lohi, Mahi Pal, Sunita, Ajay Swami, Rajiv Kumar Lohia, Hawa Singh Goyal, Sudarshan Singh Sangwan, Roshan Lal Agarwal, Mainpal Singh, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Rohit Kapoor, Advocate, Mr. Mayank Nagi, Advocate (through V.C.) and Mr. Sandeep Yadav, Advocate and Mr. Shailendra Singh, Advocate Mr. Ved Jain, Advocate (through V.C.) with Mr. Vinay Kumar, Advocate, Mr. Nishay Kantoor, Advocate and Ms. Soniya Dodeja, Advocate, Mr. B.M. Monga, Advocate, Mr. Rohit Kaura, Advocate and Mr. Rajiv Sharma, Advocate, Mr. Kushagra Mahajan, Advocate and Mr. Amit Parsad, Advocate, Mr. S.K. Mukhi, Advocate, Mr. Nikhil Goyal, Advocate and Mr. Rana Gurtej Singh, Advocate, Mr. Aman Bansal, Advocate, Mr. Bhavnik Mehta, Advocate, Mr. Arun Rana, Advoate and Ms. Rohini Bedi, Advocate, Mr. Vishav Bharti Gupta, Advocate and Ms. Mamta Gupta, Advocate, Mr. Alok Mittal, Advocate and Mr. Sylvester, Advocate Mr. Chetan Jain, Advocate, Mr. Peyush Pruthi, Advocate, Mr. Pranav Jain, Advocate,. For the Respondent(s) Revenue : Mr. Yogesh Putney, Sr. Standing Counsel Mr. Vaibhav Gupta, Jr. Standing Counsel, Ms. Urvashi Dhugga, Sr. Standing Counsel, Mr. Saurabh Kapoor, Sr. Standing Counsel Ms. Pridhi Sandhu, Sr. Standing Counsel, Mr. Ranvijay Singh, Sr. Standing Counsel, Ms. Gauri Neo Rampal, Sr. Standing Counsel (through V.C.) Mr. Varun Issar, Sr. Standing Counsel,. SANJEE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nducting faceless assessments. Sub-section (8) of Section 144B of the Act provides as under:- (8) Notwithstanding anything contained in sub-section (1) or sub-section (2), the Principal Chief Commissioner or the Principal Director General in charge of National Faceless Assessment Centre may at any stage of the assessment, if considered necessary, transfer the case to the Assessing Officer having jurisdiction over such case, with the prior approval of the Board. 4. The aforesaid provisions remained in force till the same were substituted by the Finance Act, 2022 with effect from 01.04.2022 and the new Section 144B (1) of the Act again started with a non-obstante clause, which is as under:- Faceless Assessment. 144B (1) Notwithstanding anything to the contrary contained in any other provision of this Act, the assessment, reassessment or recomputation under sub-section (3) of section 143 or under section 144 or under section 147, as the case may be, with respect to the cases referred to in sub-section (2), shall be made in a faceless manner as per the following procedure. (i) to (xxxii) xxx xxx It was again provided under sub-sections (7) and (8), which are as under:- (7) (a) The Prin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant assessment year.] Provided that the period of three years for the purposes of clause (1) shall be computed after taking into account the period of limitation as excluded by the third or fourth or fifth provisos or extended by the sixth proviso to sub-section (1) of section 149. The Words where there is no Principal Chief Commissioner or Principal Director General were omitted by the Finance Act, 2023 with effect from 01.04.2023 and the proviso, as above was added. The Faceless assessment of income escaping assessment was inserted by the Act of 2020 with effect from 01.11.2020, which is as under:- Faceless assessment of income escaping assessment, 151A. (1) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of assessment, reassessment or re-computation under section 147 or issuance of notice under section 148 [or conducting of enquiries or issuance of show-cause notice or passing of order under section 148A] or sanction for issue of such notice under section 151, so as impart greater efficiency, transparency and accountability by- a. eliminating the interface between the income-tax authority and the assessee or any other person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or classes of cases, with dynamic jurisdiction. (2) The Central Government may, for the purpose of giving effect to the scheme made under sub-section (1), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the notification: Provided that no direction shall be issued after the 31st day of March, 2022. (3) Every notification issued under sub-section (1) and sub-section (2) shall, as soon as may be after the notification is issued, be laid before each House of Parliament. In terms of the aforesaid provisions, the CBDT exercising power under sub-section (1) and sub-section (2) of Section 130 of the Act introduced and framed a scheme called Faceless Jurisdiction of Income Tax Authorities Scheme, 2022 vide notification dated 28.03.2022. Thus, the scheme was introduced on 28.03.2022 and 29.03.2022 by the CBDT. The jurisdiction of Assessing Officer is provided under Section 124 of the Act. It means the jurisdiction to assess any person and also to reassess. However, as per the scheme, the National Faceless Assessment Center was to act as the assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under unamended section 148 of the IT Act, which were the subject matter of writ petition before the various respective High Courts shall be deemed to have been issued under section 148A of the IT Act as substituted by the Finance Act, 2021 and construed or treated within to be show-cause notices in terms of section 148A (b). The assessing officer shall, within thirty days from today provide to the respective assessees information and material relied upon by the Revenue, so that the assesees can reply to the show-cause notices within two weeks thereafter; (ii) The requirement of conducting any enquiry, if required, with the prior approval of specified authority under section 148A(a) is hereby dispensed with as a one-time measure vis-a-vis those notices which have been issued under section 148 of the unamended Act from 01.04.2021 till date, including those which have been quashed by the High Courts. Even otherwise as observed hereinabove holding any enquiry with the prior approval of specified authority is not mandatory but it is for the concerned Assessing Officers to hold any enquiry, if required: (iii) The assessing officers shall thereafter pass orders in terms of section 148A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it directed the assessing officers to issue a notice under Section 148 of the new regime after following the procedure as required under Section 148-A. Although this Court waived off the requirement of obtaining prior approval under Section 148A(a) and Section 148A (b), it did not waive the requirement for Section 148A (d) and Section 148. Therefore, the assessing officer was required to obtain prior approval of the specified authority according to Section 151 of the new regime before passing an order under Section 148A (d) or issuing a notice under Section 148. These notices ought to have been issued following the time limits specified under Section 151 of the new regime read with TOLA, where applicable. It further examined the interplay of Ashish Aggarwal s case with TOLA as under:- 110. The effect of the creation of the legal fiction in Ashish Agarwal (supra) was that it stopped the clock of limitation with effect from the date of issuance of Section 148 notices under the old regime [which is also the date of issuance of the deemed notices]. As discussed in the preceding segments of this judgment, the period from the date of the issuance of the deemed notices till the supply of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect to the relevant assessment years, an assessing officer has to: (i) issue the notices within the period prescribed under Section 149(1) of the new regime read with TOLA; and (ii) obtain the previous approval of the authority specified under Section 151. A notice issued without complying with the preconditions is invalid as it affects the jurisdiction of the assessing officer. Therefore, the reassessment notices issued under Section 148 of the new regime, which are in pursuance of the deemed notices, ought to be issued within the time limit surviving under the Income Tax Act read with TOLA. A reassessment notice issued beyond the surviving time limit will be time barred. In Rajeev Bansal s case (supra), the Supreme Court, therefore, held and concluded as under:- G. Conclusions 114. In view of the above discussion, we conclude that: a. After 1 April 2021, the Income Tax Act has to be read along with the substituted provisions; b. TOLA will continue to apply to the Income Tax Act after 1 April 2021 if any action or proceeding specified under the substituted provisions of the Income Tax Act falls for completion between 20 March 2020 and 31 March 2021; c. Section 3(1) of TOLA overri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of Section 144B (7 8) of the Act and Circular issued therein, this Court in Jasjit Singh s case (supra) held as under:- 16. We are in agreement with the view taken by the Coordinate Bench and hold that such circular or instructions by the Board could not have been issued to override statutory provisions or to make them otiose or obsolete. Legislative enactments having financial implications are required to be followed strictly and mandatorily. By exercising the powers contained in Sections 119 and 120 of the Act, 1961 as well as Section 144B (7 8), the authorities cannot be allowed to usurp the legal provisions to their own satisfaction and convenience causing hardship to the assessees. It also leaves confusion in the minds of the taxpayers. In the opinion of this Court, instructions and circulars can be issued only for the purpose of supplementing the statutory provisions and for their implementation. 17. In view of the aforesaid discussion, there is no occasion to distinguish or take a different view as suggested by the learned counsel for the revenue from what has already been held by the Coordinate Bench. 18. Keeping in view the law laid down by the Coordinate B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agar, Bangalore; Appeal (Civil) No. 689 of 1998 P.S. Sathappan (dead) by LRs. Vs Andhra Bank Limited and others (2004) 11 SCC 672 and State of U. P. and others vs Jeet S. Bisht and another (2007) 7 SCR 705. 14. It is his further submissions that provisions of Section 144B read with Section 151A of the Act, including notification dated 29.03.2022, were not under consideration or examined by the Apex Court in both the cases, namely, Ashish Aggarwal and Rajeev Bansal. Hence, he submits that the observations made by the Apex Court in Ashish Aggarwal s case (supra) would not be said to mean that the Jurisdictional Assessing Officer was empowered to examine and pass assessment order. He submits that the Supreme Court realizes that after the faceless scheme was brought into operation, assessment or reassessment can only be done in accordance with the new regime. 15. He submits that against the judgments passed by this Court in Jasjit Singh; Telangana High Court in Kankanala Ravindra Reddy and Bombay High Court in Hexaware Technologies Limited, appeals were filed by the department before the Supreme Court, but no order has been passed therein. 16. Learned counsels appearing for other petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use (i) of sub-section (2) of section 143, but before the expiry of the time limit for making the assessment, reassessment or recomputation as specified in sub-section section 153, every such notice referred to in this clause shall be deemed to be a valid notice. Explanation -For the removal of doubts, it is hereby declared that nothing contained in the first proviso or the second proviso shall apply to any return which has been furnished on or after the 1st day of October, 2005 in response to a notice served under this section. (2) The Assessing Officer shall, before issuing any notice under this section, record is reasons for doing so. Section 149 of the Act as stood prior to the Finance Act, 2021 149. Time limit for notice (1) No notice under section 148 shall be issued for the relevant assessment year,- (a) if four years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b) or clause (c); (b) if four years, but not more than six years, have elapsed from the end of the relevant assessment year unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to one lakh rupees or more for that year; (c) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under section 139: Provided that no notice under this section shall be issued unless there is information with the Assessing Officer which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the relevant assessment year and the Assessing Officer has obtained prior approval of the specified authority to issue such notice: Provided further that no such approval shall be required where the Assessing Officer, with the prior approval of the specified authority, has passed an order under clause (d) of section 148A to the effect that it is a fit case to issue a notice under this section:] [Provided also that any return of income, required to be furnished by an assessee under this section and furnished beyond the period allowed shall note deemed to be a return under section 139.] Explanation 1- For the purposes of this section and section 148A, the information with the Assessing Officer which suggests that the income chargeable to tax has escaped assessment means.- (i) any information in the case of the assessee for the relevant assessment year in accordance with the risk management strategy formulated by the Board from time to time, or (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iry, if required, with the prior approval of specified authority, with respect to the information which suggests that the income chargeable to tax has escaped assessment; (b) provide an opportunity of being heard to the assessee, by serving upon him a notice to show cause within such time, as may be specified in the notice, being not less than seven days and but not exceeding thirty days from the date on which such notice is issued or such time, as may be extended by him on the basis of an application in this behalf, as to why a notice under section 148 should not be issued on the basis of information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year and results of enquiry conducted, if any, as per clause (a): (c) consider the reply of assessee furnished, if any, in response to the show-cause notice referred to in clause (b); (d) decide, on the basis of material available on record including reply of the assessee, whether or not it is a fit case to issue a notice under section 148, by passing an order, with the prior approval of specified authority, within one month from the end of the month in which the reply referred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in his possession books of account or other documents or evidence which reveal that the income chargeable to fax, represented in the form of (i) an asset; (ii) expenditure in respect of a transaction or in relation to an event or occasion; or (iii) an entry or entries in the books of account, which has escaped assessment amounts to or is likely to amount fifty lakh rupees or more:] Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before Ist day of April, 2021 if a notice under section 148 or section 153A or section 153C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of this section or section 153A or section 153C, as the case may be, as they stood immediately before the commencement of the Finance Act, 2021: Provided further that the provisions of this sub-section shall not apply in a case where a notice under section 153A, or section 153C read with section 153A, is required to be issued in relation to a search initiated under section 132 or books of account, other documents or any assets requisitioned u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty, being land or building or both, shares and securities, loans and advances, deposits in bank account. (1A) Notwithstanding anything contained in sub-section (1), where the income chargeable to tax represented in the form of an asset or expenditure in relation to an event or occasion of the value referred to in clause (b) of sub-section (1). has escaped the assessment and the investment in such asset or expenditure in relation to such event or occasion has been made or incurred, in more than one previous years relevant to the assessment years within the period referred to in clause (b) of sub-section (1), a notice under section 148 shall be issued for every such assessment year for assessment, reassessment or recomputation, as the case may be. (2) The provisions of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151. 18. The Supreme Court while examining the interplay of Ashish Aggarwal with TOLA in Rajeev Bansal s case (supra) had noticed one instance in para 113. It used the words to assume jurisdiction to issue notices under Section 148 with respect to the relevant assessment years of 2013-2014, 2014-2015, 2015-2016, 2016-2017 and 2017- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew provisions also reflect that it is the assessing officer, who has issued notices, would take a decision under Section 148A (d) of the Act as it is he who would be having the available material to examine the reply of the assessee. He would thereafter issue notice under Section 148 of the Act treating it to be a fit case for reassessment, if so required or may drop the proceedings. Once he has issued notice under Section 148 of the Act, the proceedings can be transferred for issuing the reassessment order through faceless regime. If the contention of the respondents is accepted, the entire process has to be conducted under the faceless regime, not by the jurisdictional assessing officer the result would be that all the notices issued and treated by the Supreme Court as issued under Section 148A (b) of the Act would become otiose and redundant for all the purposes. 21. As per Section 148 of the Act amended with effect from 01.04.2021, the assessing officer has to serve on the assessee a notice before making assessment / reassessment or recomputation on the basis of information with the assessing officer which suggests that the income chargeable to tax has escaped assessment. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... course is adopted by the Jurisdictional Assessing Officer. The submission of the petitioners is, therefore, found to be without force. 26. In view of our above reasons and observations, we do not agree with the view taken by the Telangana High Court in Kankanala Ravindra Reddy s case (supra). 27. The contention of Mr. Bansal, learned senior counsel for the petitioners relating to non-application of the judgment passed in Rajeev Bansal s case (supra) is also found to be wholly misconceived. So far as the case decided by us in Jasjit Singh s case (supra) is concerned, we find the facts of that case were different. The case deals with the notices which have been issued by the Jurisdictional Assessing Officer after the faceless regime had come into force with effect from 29.03.2022. 28. The view taken by the Bombay High Court in Hexaware Technologies Limited s case (supra) also does not apply to the present bunch of cases. It is made clear that the petitioners relating to the orders passed by the Assessing Officer on merits can be raised in appeal before the appellate authority. If appeals are so filed, the same shall be decided on merits and the delay shall be condoned on account of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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