ASHISH BHARADIA S/O SHREE GOPAL BHARADIA vs. INCOME TAX OFFICER

Facts

The petitioner, Ashish Bharadia, challenged a notice dated April 15, 2023, issued under Section 148 of the Income Tax Act, 1961. The petitioner contended that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO). The respondent, Income Tax Officer, Ward-1, Beawer, appeared before the court. The court noted that one of the grounds raised by the petitioner was covered by previous judgments of the Rajasthan High Court. The revenue acknowledged that the notice might be invalid based on existing precedents but sought liberty to revive it if higher courts overturned those decisions.

Held

The High Court quashed and set aside the notice dated April 15, 2023, issued under Section 148 of the Income Tax Act, 1961. The court agreed with the petitioner that the notice was invalid based on the established precedents of Shree Cement Limited, Sharda Devi Chhajer, and Hexaware Technologies Ltd., which held that such notices issued by a JAO instead of an FAO are bad in law. The court granted the revenue liberty to revive the notice if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. The court also stated that any re-assessment order passed pursuant to the quashed notice would also stand quashed and set aside. The petition was disposed of, keeping open all rights and contentions of the parties.

Key Issues

1. Whether a notice issued under Section 148 of the Income Tax Act, 1961, by a Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) is invalid? (Question of law) Assessee's Contention: The notice dated April 15, 2023, issued under Section 148 of the Income Tax Act, 1961, is bad and not valid because it was issued by a JAO and not an FAO. This contention is supported by the judgments of this Court in Shree Cement Limited Vs. Assistant Commissioner of Income-Tax & Others and Sharda Devi Chhajer Vs. The Income Tax Officer & Another, as well as the Bombay High Court's decision in Hexaware Technologies Ltd. Vs. Assistant Commissioner of Income-tax, Circle 15(1)(2). Revenue's Contention: The revenue agreed that one of the grounds raised by the petitioner was covered by a judgment of the court. However, the revenue noted that a Special Leave Petition (SLP) has been filed against the Hexaware Technologies Ltd. judgment, and notice has been issued. The revenue requested liberty to revive the Section 148 notice if the Apex Court interferes with the aforementioned judgments.