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Facts
The assessee and revenue filed cross-appeals challenging orders passed under Section 250 of the Income Tax Act. The assessee sought to raise an additional ground of appeal concerning the validity of the assessment proceedings.
Held
The Tribunal admitted the additional ground of appeal as it was a legal issue going to the root of the case. The Tribunal noted that notices under Section 148 were issued by the JAO, not the Faceless Assessing Officer, violating the faceless assessment scheme and statutory mandate.
Key Issues
Whether the reassessment proceedings initiated by the Jurisdictional Assessing Officer, contrary to the faceless assessment scheme, are void ab initio.
Sections Cited
250, 147, 143(3), 144B, 151A, 148
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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI
Before: SHRI SANDEEP GOSAIN & SHRI OMKARESHWAR CHIDARA
Date of Hearing 25.11.2025 Date of Pronouncement 02.12.2025 ORDER PER SANDEEP GOSAIN, JM:
These are the cross appeals filed by the assessee as well as revenue challenging the different impugned orders respectively passed under section 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre (NFAC) / CIT(A) for the assessment year 2020-21, 2021-22 & 2022- 23.
Since all the issues involved in these three appeals 2. are common and identical and belongs to one assessee therefore, they have been clubbed, heard together and consolidated order is being passed. Firstly we shall take for A.Y 2020-21 as lead case and facts narrated therein.
6068/Mum/2025, A.Y 2020-21
At the very outset, we noticed that assessee has moved an application for leading additional grounds before us and the contents of the same is reproduced herein below:
The applicant craves leave to raise the following by way of additional ground of appeal:
"1. That the Ld. Assessing Officer grossly erred, both in law and on facts, in purporting to assume jurisdiction and frame the impugned assessment under section 147 read with section 143(3) of the Income-tax Act, 1961 ('the Act'), in complete disregard of the mandatory procedure prescribed under section 144B/ 151A of the Act. The said assessment, having been framed dehors the faceless assessment scheme and in violation of the statutory mandate, is ex facie without jurisdiction, null and void ab initio, and liable to be quashed on this ground alone."
The aforesaid additional ground of appeal raises a pure legal issue.
In view of the above, it is respectfully submitted that, the aforesaid additional ground of appeal calls for being admitted and adjudicated on merits in terms of the discretion vested in your Honours under Rule 11 of the Income-tax (Appellate Tribunal) Rules, 1963 and the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. v. CIT: 229 ITR 383 and also the decision in the case of Jute Corporation of India v. CIT: 187 ITR 688.
The applicant trusts that the aforesaid request shall be acceded to.
6069 & 6070/Mum/2025 Mr. Sachiv Sahni,. Mumbai. An opportunity of being heard is prayed for. We have heard the counsels for both the parties, 4. perused the material placed on record, judgments cited before us and also the orders passed by the revenue authorities. From the records, we found that the additional grounds raised is same is legal in nature and goes to the roots of the case, therefore while following the principles laid down in the decision of Hon’ble Supreme Court in the case of The Jute Corporation India Ltd., Vs. CIT, 187 ITR 688 and The NTPC Vs. CIT, 229 ITR 383 and also considering the facts of the present case, we allow the application for raising the additional grounds and consequently the said ground is admitted to be heard on merits.
Since we have allowed the additional ground raised by the assessee which is legal in nature and goes to the roots of the case and outcome of the decision of the legal ground would have effect on the other grounds raised by the assessee. Therefore, we have decided to adjudicate the additional ground firstly which is reproduced herein below:
1. That the Ld. Assessing Officer grossly erred, both in law and on facts, in purporting to assume jurisdiction and frame the impugned assessment under section 147 read with section 143(3) of the Income-tax Act, 1961 ('the Act'), in complete disregard of the mandatory procedure prescribed under section 144B/ 151A of the Act. The said assessment, having been framed dehors the faceless assessment scheme and in violation of the statutory mandate, is ex facie without jurisdiction, null 6069 & 6070/Mum/2025 Mr. Sachiv Sahni,. Mumbai. and void ab initio, and liable to be quashed on this ground alone.
We have heard the counsels for both the parties, perused the material placed on record, judgements cited before us with regard to additional ground. From the records we noticed that the notices issued u/s 148 of the Act for reopening of the assessment in the case of the assessee is mentioned below:
Date of Notice A.Y Authority 30.03.2024 2020-21 JAO 30.03.2024 2021-22 JAO 30.03.2024 2022-23 JAO 7. From the above table we noticed that all the notices for the respective assessment years were issued by the JAO. In our view the JAO could not have assumed jurisdiction and frame the impugned assessment u/s 147 r.w.s 143(3) of the Act, in this regard of the mandatory procedure prescribed u/s 144B / 151A of the Act. We also noticed that the said assessment, having been framed dehorse, the faceless assessment scheme and in violation of the statutory mandate, which in our view is without jurisdiction and thus null and void.
Our above view also stands fortified by the decision of the Coordinate Bench of ITAT in and Ors in the case of Veda Real Estate Corporation Pvt Ltd. which is reproduced herein below:
At the outset, Ld. AR submitted that this ground No.1 is squarely covered by the decision of the coordinate bench of ITAT in assessee’s own case for the A.Y 2012-13 in dated 28.10.2025and the operative portion of the order is reproduced here in below:
“41.Having disposed of the additions of merits, we now turn to legal ground concerning the validity of the assessment itself. Upon the submissions and the judicial precedents, especially of Hon'ble Jurisdictional High Court which is a binding precedent on us, we are persuaded that the reassessment edifice is untenable on two independent yet converging grounds. The assessee has assailed the reassessment orders on two principal planks first, that the notice under section 148 was issued by the Jurisdictional Assessing Officer instead of the Faceless Assessing Officer, in contravention of the scheme notified under section 151A vide Notification S.O. 1466(E) dated 29th March 2022; since the assessment order does not bears Document Identification Number (DIN), the same is non est as per CBDT Circular No. 19 of 2019 dated 14th August 2019. On the first issue, thelegal position is no longer res integra. The Hon'ble Bombay High Court in Hexaware Technologies Ltd. v. ACIT (2024) 464 ITR 430 (Bom)) has decisively explained that where Parliament and the delegated notification have assigned jurisdiction to the faceless unit, the jurisdiction of the local officer stands eclipsed. The scheme does not contemplate a concurrent or overlapping authority. Any notice issued dehors the faceless framework is coram non- judice and the proceeding is void at inception. The exposition laid down by the Hon'ble Bombay High Court in Hexaware Technologies Ltd. v. ACIT has since been consistently followed by the same Court in Capital G LP v. ACIT, Abhin Anil Kumar Shah v. ITO [(2024) 468 ITR 350 (Bom)), and Ganesh Nivrutti Jagtap v. ACIT [(2024) 166 Taxmann.com 168 (Bom)], thereby fortifying the principle that the faceless assessment regime under section 151A is not a matter of administrative convenience but a jurisdictional imperative. The High Court in these decisions has unambiguously held that once jurisdiction is statutorily vested in the Faceless Assessing Officer, any notice issued by the Jurisdictional Assessing Officer is coram non judice and consequently void ab initio. 42….. 43….. 44….. 45….. 46…..
47 Having held so, it necessarily follows that the reassessment proceedings initiated under section 148 by the jurisdictional Assessing Officer, in violation of the Faceless Scheme under section 151A and compounded by the failure to generate and quote a valid DIN, stand vitiated in law. The dualbreaches one jurisdictional, the other procedural strike at the root of the assessment's validity. The notice under section 148, having been issued by an officer not authorised under the notified scheme, is coram non judice, and the subsequent order passed without a valid DIN is a nullity. This conclusion is fortified by the decision of the Hon'ble Bombay High Court in Hexaware Technologies Ltd. v. ACIT (supra), which has been consistently followed in Capital G LP v. ACIT (Writ Petition No. 15289 of 2024), Abhin Anil Kumar Shah v. ITO [(2024) 468 ITR 350 (Bom)], and Ganesh Nivrutti Jagtap v. ACIT [(2024) 166 Taxmann.com 168 (Bom)). The dismissal of the Special Leave Petition by the Hon'ble Supreme Court in Deepanjan Roy v. ADIT [SLP (C) No. 18753/2025] lends further imprimatur to this legal position. Thus, we have no hesitation in holding that the reassessment orders impugned before us are void ab initio, both for want of jurisdiction and for breach of mandatory procedural require.
The third legal infirmity relates to the manner in which the impugned notice dated 27.01.2023 has been issued under section 148. The AO has issued the notice under section 148. on the ground that the search was conducted on the assesse despite the fact that no search was ever conducted on the assesse. The reliance on the full bench of the Bombay High Court in the case of Mohd Farhan A Sheik (125 taxmann.com 253) clearly applies to the facts of the case at hand and respectfully following the full bench decision of jurisdictional High Court, the notice issued under section 148 is held to be defective.”
After having gone through the decision of the Coordinate Bench of ITAT in the case of Veda Real Estate (supra), we find that the facts of the present case are similar with the above mentioned case therefore while following the decision of the Jurisdictional High Court in the case of Hexaware Technologies Ltd. Vs. ACIT [2024] 464 ITR 430 (Bom), which has also been consistently followed by the same court in the case of Capital G LP Vs. 6069 & 6070/Mum/2025 Mr. Sachiv Sahni,. Mumbai. ACIT, Abhin Anil Kumar Shah Vs. ITO, [2024] 468 ITR 350(Bom), and Ganesh Nivrutii Jagatap Vs. ACIT [2024] 166 taxmann.com 168 (Bom), thereby fortifying the principle that the faceless assessment regime under section 151A is not a matter of administrative convenience but jurisdictional imperative. The High Court in these decisions has unambiguously held that once jurisdiction is statutorily vested in the faceless AO, any notice issued by the Jurisdictional AO is coram non judice and consequently void ab initio and resultantly the impugned reopening proceedings so initiated and the impugned reassessment order passed thereafter also stands quashed. Moreover in the absence of any contrary authority or distinguishing factual material, we are bound to follow the consistent line of judicial precedents emanating from the decision of the Jurisdictional High Court. Accordingly and respectfully while following the principles of judicial discipline and consistence, we therefore direct the AO to verify from the records and in case it is found that JAO had issued reassessment notice u/s 147 r.w.s 143(3) then in that eventuality the AO is direct to follow the decision of Hexaware Technologies Ltd (supra). With these directions we restore the matter back to the file of AO. order accordingly therefore this ground raised by the assessee stands allowed.
Since we have restore the mater back to the file of AO for verification therefore there is no need to adjudicate 6069 & 6070/Mum/2025 Mr. Sachiv Sahni,. Mumbai. other grounds at this stage raised by the assessee as the decision of the additional ground would have bearing on the other grounds raised by the assessee as well. Hence other grounds raised by the assessee are kept open.
In the result the appeal filed by the assessee stands partly allowed statistical purposes.
12. As the facts and circumstances in these appeals are identical to for the A.Y 2020-21 (except variance in figures) and the decision rendered in above paragraph would apply mutatis mutandis for these appeal also. Accordingly, the grounds of appeal of the present appeals also stands partly allowed for statistical purposes.
In the result, all the three appeals filed by the assessee stands partly allowed for statistical purposes.
Order pronounced in the open court on 02/12/2025