INCOME TAX OFFICER, CHENNAI vs. ASOKAN RENUKA DEVI, CHENNAI

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ITA 209/CHNY/2026Status: DisposedITAT Chennai22 July 2026AY 2016-174 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the Supreme Court had set aside the High Court judgments relied upon by the CIT(A) due to a retrospective amendment by the Finance Act, 2026, which validated notices issued by the JAO. Consequently, the CIT(A)'s order was set aside.

What were the facts?

The Revenue appealed against the CIT(A)'s order quashing a notice issued under Section 148. The CIT(A) had relied on High Court decisions holding that such notices could not be issued by the Jurisdictional Assessing Officer (JAO) after the introduction of faceless assessment.

What were the issues?

The primary issue was the validity of a Section 148 notice issued by the JAO after the introduction of faceless assessment, considering subsequent Supreme Court and High Court developments.

Which sections of the Income-tax Act were involved?

Section 148,Section 151A,Section 144B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI

Before: SHRI ABY T. VARKEY & SHRI GAGAN GOYAL

Hearing: 16.06.2026Pronounced: 22.07.2026

Heard together (2 matters)

ITA No.209/Chny/2026
Co No. 06/Chny/2026

Read from the judgment's own cause title. This page is filed under one of them.

आदेश / O R D E R PER ABY T. VARKEY, JM: This is an appeal preferred by the Revenue and Cross-Objection (CO) filed by assessee against the order of the Ld. CIT(A) dated 12.11.2025 for the Assessment Year 2016–17. The main grievance of the Revenue is against the order of the Ld. CIT(A) quashing the notice issued under Section 148 by the Jurisdictional Assessing Officer (JAO) as not

ITA No.209 /Chny/2026 & CO 06/Chny/2026 (AY 2016-17) Asokan Renuka Devi. :: 2 :: valid. CO of assessee is supporting the action of Ld CIT(A), but for not adjudicating other legal issues against reopening of assessment.

2.

In this regard, it is noted that the Ld. CIT(A) has taken note that the JAO has issued notice of reopening under Section 148 of the Income- tax Act (herein after ‘the Act’) on 30.03.2023, which, according to the CIT(A), ought to have been issued by the Faceless Assessment Unit from 29.03.2022, by relying on the decisions of various High Courts including the Telangana High Court in Kankanal Revindre Reddy v. ITO & Ors (2023) 334 CTR 0646 (Telangana HC); and Deepanjan Roy v. ADIT (Int. Taxn.), WP No. 23573/2024 (Telangana HC), which decision was challenged by the Revenue before the Hon’ble Supreme Court and SLP was dismissed. The Ld.CIT(A) is note to have relied on the decision of the Chennai Tribunal in the case of Pavan Balan vs. ITO, (ITA No.2116/Chny/2025 dated 24.10.2025), wherein the Tribunal took note of the decision of the Hon’ble Jurisdictional High Court in the case of Mark Studio India (P) Ltd. V. ITO and the decision rendered by Division Bench of the Hon’ble Bombay High Court in Hexaware Technology Ltd. vs. Assistant Commissioner of Income Tax, (2024) 464 ITR 430 (Bombay), wherein it has been held that notice under Section 148 of the Act cannot be issued by the Jurisdictional Assessing Officer (JAO) after introduction of the concept of faceless assessment under Section 151A read with Section 144B of the 1961 Act with effect from 29.03.2022.

3.

However, we note that the Revenue had preferred appeals before the Hon’ble Apex Court [against the various High Courts’ decisions

ITA No.209 /Chny/2026 & CO 06/Chny/2026 (AY 2016-17) Asokan Renuka Devi. :: 3 :: (supra) quashing the notices issued under Section 148 by the JAO on or after 29.03.2022 as invalid], and the Hon’ble Apex Court is noted to have taken note of the amendment brought in retrospectively by the Finance Act, 2026, validating the issue of notice by JAO, and vide order dated 10.04.2026, set aside the above cited High Court judgments (supra) holding that the JAO could not have issued notice under Section 148 on or after 29.03.2022, basis which the Ld CIT(A) has allowed the legal issue raised by the assessee in the present case. Further, the Hon’ble Supreme Court has allowed the taxpayers to file writ petitions in their respective High Courts to challenge the validity of the retrospective amendments made by the Finance Act, 2026. The Hon’ble Supreme Court is noted to have directed the Hon’ble High Courts to decide the petitions filed before July 31, 2026, and was pleased to stay the assessments.

4.

In the light of the aforesaid developments, it is noted that the impugned action of the Ld. CIT(A), based on various High Court decisions referred (supra), cannot survive, since they have been set aside by Hon’ble Supreme Court. Meaning thereby that when the foundation on the basis of which the Ld. CIT(A) allowed the appeal of the assessee has been removed, we have to set it aside.

5.

Hence, we set aside the impugned order of the Ld. CIT(A) and note that the Ld CIT(A) didn’t decide the other grounds raised by the assessee on merits. Hence we restore the appeal back to the file of the Ld. CIT(A) with a direction to await the decision of the Hon’ble Supreme Court / Hon’ble Jurisdictional High Court on the legal issue in the light of the

ITA No.209 /Chny/2026 & CO 06/Chny/2026 (AY 2016-17) Asokan Renuka Devi. :: 4 :: retrospective amendment brought in by the Finance Act, 2026, whether the notice issued by the JAO under Section 148 on or after 29.03.2022 is valid, and thereafter to decide the legal issue raised in this regard by the assessee. And in the event assessee chooses not to press this legal issue, the Ld CIT(A) is at liberty to decide other grounds on its own merits after hearing the assessee in accordance to law. Coming to the CO filed by the assessee against the omission on the part of the Ld.CIT(A) not to have decided the other legal issue raised by him against reopening of the assessment and also on merits of the addition, we direct the Ld.CIT(A) to decide the same in accordance to law after hearing the assessee.

6.

In the result, the appeal of the Revenue and CO of the assessee are allowed for statistical purposes.

Order pronounced on the 22nd day of July, 2026, in Chennai. Sd/- Sd/- (गगन गोयल) (एबी टी. वक�) (ABY T. VARKEY) (GAGAN GOYAL) �या�यक सद�य/JUDICIAL MEMBER लेखा सद�य/ACCOUNTANT MEMBER चे�नई/Chennai, �दनांक/Dated: 22nd July, 2026. YS आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT, Chennai / Madurai / Salem / Coimbatore. 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF YASHV Digitally signed by YASHVIR IR SINGH Date: 2026.08.03 SINGH 15:49:48 +05'30'

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