MANOJ CHORDIA S/O UTTAM CHAND JAIN vs. INCOME TAX OFFICER

Facts

The petitioner, Manoj Chordia, challenged a notice dated April 15, 2023, issued under Section 148 of the Income Tax Act, 1961, by the Income Tax Officer, Ward-2(1), Ajmer. The petitioner contended that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO). The respondent revenue acknowledged that one of the grounds raised by the petitioner was covered by a previous judgment of the High Court. The revenue also informed the court that a Special Leave Petition (SLP) had been filed against the Hexaware Technologies Ltd. judgment, and notice had been issued by the Apex Court.

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 as it was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO), citing its own judgments in Shree Cement Limited and Sharda Devi Chhajer, which followed the principle laid down in Hexaware Technologies Ltd. However, the court granted liberty to the revenue 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 reassessment order passed pursuant to this notice would also stand quashed and set aside. All other rights and contentions of the parties were kept open.

Key Issues

1. Whether a notice dated April 15, 2023, issued under Section 148 of the Income Tax Act, 1961, by a Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) is bad in law and invalid? Assessee's Contention: The notice is invalid because it was issued by a JAO, not an FAO, relying on the High Court's judgments in Shree Cement Limited and Sharda Devi Chhajer. Revenue's Contention: While agreeing that the notice is covered by the cited judgments, the revenue noted that an SLP was pending before the Apex Court concerning the Hexaware Technologies Ltd. case. The revenue requested liberty to revive the notice if the Apex Court's decision overturns the High Court's rulings in the aforementioned cases.