KRISHAN GOPAL GUPTA S/O LATE SHIVCHARAN GUPTA vs. OFFICE OF THE INCOME TAX OFFICER

Facts

The petitioner, Krishan Gopal Gupta, challenged a notice dated April 18, 2023, issued under Section 148 of the Income Tax Act, 1961. The petitioner argued that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO), rendering it invalid. The respondent, the Income Tax Officer, Ward 5(1), Jaipur, acknowledged that one of the grounds raised by the petitioner was covered by a previous judgment of the High Court. The respondent also noted that a Special Leave Petition (SLP) had been filed by the Revenue in a similar case (Hexaware Technologies Ltd.) and notice had been issued by the Supreme Court. The respondent sought liberty to revive the notice if the Supreme Court's decision differed from the High Court's rulings.

Held

The High Court, acknowledging the agreement between the parties, quashed and set aside the notice dated April 18, 2023, issued under Section 148 of the Income Tax Act, 1961. The Court followed its previous judgments in Shree Cement Limited, which relied on Sharda Devi Chhajer and Hexaware Technologies Ltd., holding that such a notice issued by a JAO instead of an FAO would be invalid. 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 rights and contentions of the parties were kept open.

Key Issues

1. Whether a notice dated April 18, 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? (Question of law and fact, concerning Section 148 of the Income Tax Act, 1961). Assessee's Contention: The notice is invalid as it was issued by a JAO and not an FAO, relying on the High Court's judgments in Shree Cement Limited and Sharda Devi Chhajer. Revenue's Contention: The Revenue agreed that the ground was covered by the High Court's judgment. However, it pointed out that an SLP had been filed in the Hexaware Technologies Ltd. case, and notice had been issued. The Revenue requested liberty to revive the notice if the Supreme Court's decision on the aforementioned cases was in its favor.