DHIRAJ HIMATH JETHANI (AY 2019 2020) vs. ASST COMMISSIONER OF INCOME TAX CENTRAL CIRCLE (4) THANE

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WP/1110/2026HC BombayHCBM01003040202627 January 2026Author: HON'BLE SHRI JUSTICE B.P. COLABAWALLA,HON'BLE SHRI JUSTICE FIRDOSH PHIROZE POONIWALLA5 pages
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What did the High Court hold?

The High Court held that the Notice issued under Section 148 by the Jurisdictional Assessing Officer instead of the Faceless Assessing Officer is a fatal defect. The Court found no merit in the Revenue's argument that the decision in Hexaware Technologies Ltd. V/s. Assistant Commissioner of Income-tax would not apply to central charges. The Court referred to another Division Bench judgment in Abhin Anilkumar Shah v/s Income-tax Officer, International Taxation, which clearly opined that even in cases of central charges and international taxation, the notice must be issued under the faceless procedure as notified under Section 144B read with Section 151A of the Act. The Court found that the facts of the present case were squarely covered by both the Hexaware and Abhin Shah judgments and were bound to follow them. Consequently, the impugned Notice under Section 148 and all consequential proceedings/orders were set aside. The petitioner undertook to withdraw the appeal filed before the CIT (Appeals), which would stand revived if the present order is challenged and set aside or if the Supreme Court decides against the assessee in the Hexaware Technologies Ltd. case.

What were the facts?

The petitioner, Dhiraj Himath Jethani, filed a writ petition challenging a notice issued under Section 148 of the Income Tax Act, 1961. The petitioner argued that the notice was invalid because it was issued by the Jurisdictional Assessing Officer, whereas the law mandates that such notices must be issued by the Faceless Assessing Officer. The petitioner relied on a Division Bench judgment of the Bombay High Court in Hexaware Technologies Ltd. V/s. Assistant Commissioner of Income-tax. The Revenue contended that the Hexaware judgment did not apply to central charges and that the judgment itself was under challenge before the Supreme Court, requesting the petition be kept pending. The High Court noted that the notice was indeed issued by the Jurisdictional Assessing Officer.

What were the issues?

1. Whether a Notice issued under Section 148 of the Income Tax Act, 1961, by the Jurisdictional Assessing Officer, instead of the Faceless Assessing Officer, is a fatal defect rendering the notice invalid? (Question of law, concerning Section 148 and the faceless assessment scheme). Assessee's contention: The notice is invalid as it was issued by the Jurisdictional Assessing Officer, contrary to the mandatory requirement of issuance by the Faceless Assessing Officer, as held in Hexaware Technologies Ltd. V/s. Assistant Commissioner of Income-tax. Revenue's contention: The ratio in Hexaware Technologies Ltd. does not apply to the present case as it relates to central charges. Alternatively, the Hexaware judgment is under challenge before the Supreme Court, and the present petition should be kept pending until the Supreme Court's decision.

Which sections of the Income-tax Act were involved?

Section 148,Section 144B,Section 151A

AI-generated summary — verify with the full judgment below

sr.22-wp-1110-2026.doc

IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 1110 OF 2026 Dhiraj Himath Jethani .. Petitioner Versus Assistant Commissioner of Income Tax Central Circle (4), Thane & Ors. .. Respondents Adv. Sham Walve a/w Adv. Sameer Dalal a/w Adv. Bhavik Chheda for the Petitioner. Adv. Ashok Kotangale a/w Adv. Nikitesh Kotangale a/w Adv. Suresh Kabra for the Respondents/Revenue.

CORAM: B. P. COLABAWALLA & FIRDOSH P. POONIWALLA, JJ. DATE: JANUARY 27, 2026 P. C.

1.

Rule. Respondents waive service. With the consent of the parties, Rule made returnable forthwith and heard finally.

2.

The above Writ Petition interalia challenges the Notice issued under Section 148 of the Income Tax Act, 1961 on various grounds. One of the grounds is that the Notice has been issued by the Jurisdictional Assessing Officer when the law mandates that it has to be issued by the Faceless JANUARY 27, 2026 TRUSHA TUSHAR MOHITE TRUSHA TUSHAR MOHITE Date: 2026.01.29 11:10:05 +0530

sr.22-wp-1110-2026.doc

Assessing Officer. This is a fatal defect and therefore the Notice has to be quashed, is the argument of the Petitioner.

3.

It is the Petitioner's contention that this issue is squarely covered by a decision of a Division Bench of this Court in the case of Hexaware Technologies Ltd. V/s. Assistant Commissioner of Income-tax, circle 15(1)(2) [(2024) 162 taxmann.com 225 (Bombay)].

4.

On the other hand, the learned advocate appearing on behalf of the Revenue stated that the ratio laid down in Hexaware Technologies Ltd (supra), would not apply to the facts of the present case because the present matter is in relation to central charges and hence that would not be covered. Without prejudice to the aforesaid argument, the learned counsel further submitted that even if the ratio of the judgment in Hexaware Technologies Ltd (supra) was to apply, the said judgment has been challenged before the Hon'ble Supreme Court and the Hon'ble Supreme Court is likely to take up the matter shortly. He, therefore, submitted that the Writ Petition be kept pending till the decision in Hexaware Technologies Ltd (supra) is rendered by the Hon'ble Supreme Court. JANUARY 27, 2026 sr.22-wp-1110-2026.doc

5.

We have heard the learned Counsel for the parties and also perused the papers and proceedings in the above Writ Petition. In the facts of the present case, there is no dispute that the Notice under Section 148 has been issued by the Jurisdictional Assessing Officer instead of the Faceless Assessing Officer. This as per the decision in the case of Hexaware Technologies Ltd (supra), would be fatal to the Notice. We find no force in the argument of the Revenue that the judgment in Hexaware Technologies Ltd (supra) would not apply to the present case because it relates to central charges. This issue is also covered by another Division Bench judgment of this Court and in the case of Abhin Anilkumar Shah v/s Income-tax Officer, International Taxation [2024] 166 taxmann.com679 (Bombay). In this decision, the Division Bench has clearly opined that even in cases of central charges and international taxation, the Notice would have to be issued under the faceless procedure, namely, by the Faceless Assessing Officer. Paragraph 17 of the decision in Abhin Shah (supra) sets out the aforesaid proposition and reads thus:- "

17.

We have thus reached a considered conclusion that the mandatory faceless procedure for issuance of notice under Section 148 of the Act falling within the purview of the scheme notified by the Central Government dated 29th March 2022 would not exclude the Central charges and International Taxation charges from the application of the faceless mechanism as notified under Section 144B read with Section 151A of the Act."

6.

We, therefore, find that the contention of the Revenue that, in JANUARY 27, 2026 sr.22-wp-1110-2026.doc

the present case, the Jurisdictional Assessing Officer could have issued Notice under Section 148 is contrary to the law laid down by this Court. Once we find that the facts of the present case are squarely covered not only by the decision of Hexaware Technologies Ltd (supra) but also in the case of Abhin Shah (supra), we are bound to follow the said decisions. We accordingly set aside the impugned Notice issued under Section 148 and all other proceedings/orders emanating therefrom.

7.

The learned Conunsel appearing on behalf of the Petitioner also brought to our notice that the impugned notice issued under Section 148 and the assessment order passed thereon have been challenged by the Petitioner by preferring an Appeal before the CIT (Appeals). In light of this order, the learned Counsel appearing on behalf of the Petitioner, on instructions, undertakes to withdraw the said Appeal within a period of three weeks from today. The said undertaking is accepted. If, for any reason, the present order is challenged by the Revenue and is set aside or if the issue in Hexaware Technologies Ltd (supra) is decided against the Assessee, and which is pending in the Hon'ble Supreme Court, then, the Appeal filed by the Petitioner before CIT (Appeals) will automatically stand revived and the same will be prosecuted on its own merits and in accordance with law. JANUARY 27, 2026 sr.22-wp-1110-2026.doc

8.

Rule is made absolute in the aforesaid terms, and the Writ Petition is also disposed of in terms thereof. However, there shall be no order as to costs.

9.

This order will be Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order. [FIRDOSH P. POONIWALLA, J.] [B. P. COLABAWALLA, J.] JANUARY 27, 2026

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