NARENDRA KUMAR KOTHARI vs. THE INCOME TAX OFFICER ITO WARD-1

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CW/7978/2023HC Rajasthan2025:RJ-JD:42586-DB23 September 2025Author: K.R. SHRIRAM, SANDEEP TANEJA2 pages
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What did the High Court hold?

The High Court quashed and set aside the notice dated July 29, 2022, issued under Section 148 of the Income Tax Act, 1961. The Court found that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO), which, following its own precedents in Shree Cement Limited and Sharda Devi Chhajer, rendered the notice invalid. Consequently, the assessment order dated May 25, 2023, which was consequential to the invalid notice, was also quashed and set aside. The Court granted liberty to the Revenue to revive the notice if the Apex Court were to interfere with the aforementioned judgments. The Court kept open all rights and contentions of the parties. No other grounds were decided on merits.

What were the facts?

The petitioner, Narendra Kumar Kothari, challenged a notice dated July 29, 2022, 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), rendering it invalid. The respondents, including the Income Tax Officer, the Assessment Unit, and the Central Board of Direct Taxes, were represented. The High Court noted that an assessment order dated May 25, 2023, had been passed subsequent to the filing of the petition. The court was informed that a Special Leave Petition (SLP) had been filed by the Revenue in a related case, Hexaware Technologies Ltd., and notice had been issued.

What were the issues?

1. Whether a notice dated July 29, 2022, issued under Section 148 of the Income Tax Act, 1961, by a Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) is valid? (Question of law) Assessee's Contentions: The assessee argued that such a notice is bad in law and not valid, relying on the High Court's judgments in Shree Cement Limited and Sharda Devi Chhajer. The assessee also stated that they would reserve their right to raise other grounds at an appropriate stage. Revenue's Contentions: The Revenue, through its counsel, agreed that one of the grounds raised by the petitioner was covered by a judgment of the Court. The Revenue acknowledged that in the case of Hexaware Technologies Ltd., an SLP had been filed and notice issued. The Revenue requested liberty to revive the notice under Section 148 if the Apex Court interfered with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited.

Which sections of the Income-tax Act were involved?

Section 148

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
[2025:RJ-JD:42586-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 7978/2023 Narendra Kumar Kothari S/o Mohan Lal Kothari, Aged About 56 Years, R/o C-59, Kashipuri, Bhilwara 311001 Rajasthan. ----Petitioner Versus 1. The Income Tax Officer Ito Ward-1, Bhilwara, Kawa Khera Chourha, Shastri Nagar, Bhilwara Rajasthan 311001. 2. Assessment Unit, National Faceless Assessment Centre, National Faceless Assessment Centre, C- Block, 4Th Floor, S.p.m. Civic Centre, New Delhi- 110001. 3. Central Board Of Direct Taxes, Through Chairperson, Type - 7, Bungalow No. 75, New Moti Bagh, New Delhi- 110001. ----Respondents For Petitioner : Mr. Pranav Bharadwaj For Respondents : Mr. K.K. Bissa with Mr. G.S. Chouhan HON'BLE CHIEF JUSTICE MR. K.R. SHRIRAM HON'BLE MR. JUSTICE SANDEEP TANEJA

Order 23/09/2025

1.

Mr. Bissa, who appears on advance copy, agrees with Mr. Bharadwaj that one of the grounds raised certainly is covered by a judgment of this Court.

2.

Ground referred to is that the notice dated 29th July 2022 under Section 148 of the Income Tax Act, 1961 has been issued by a Jurisdictional Assessing Officer (JAO) and not Faceless Assessing Officer (FAO) and this Court in the case of Shree Cement Limited Vs. Assistant Commissioner of Income-Tax & Others1 following Sharda Devi Chhajer Vs. The Income Tax Officer & Another2 and Hexaware Technologies Ltd. Vs. Assistant Commissioner of Income-tax, Circle 15(1)(2)3,has held that such a notice will be bad and not valid. 1 DB Civil Writ Petition No.10540/2024, dated 05.08.2025 at Jaipur Bench (unreported) 2 2025 SCCOnLine Raj 3386 3 [2024] 162 taxmann.com 225 (Bombay) (Uploaded on 23/09/2025 at 05:23:41 PM) (Downloaded on 27/10/2026 at 11:16:35 PM)

[2025:RJ-JD:42586-DB] (2 of 2) [CW-7978/2023]

3.

At the same time, Mr. Bissa states that in Hexaware Technologies Ltd.(supra), Revenue has preferred a Special Leave Petition and notice has been issued. Counsel states that in view of the law as it stands today, Court may grant the prayer of petitioner but in case the Apex Court interferes with judgment in Hexaware Technologies Ltd. (supra), Sharda Devi Chhajer (supra) or Shree Cement Limited (supra), then Revenue should be given liberty to revive the notice issued under Section 148 of the Act.

4.

Mr. Bharadwaj states that in view of the above, for the present, petitioner will reserve its right to raise other grounds at an appropriate stage.

5.

Therefore, keeping open all rights and contentions of parties, we quash and set aside notice dated 29th July 2022 issued under Section 148 of the Act with liberty as prayed.

6.

We are informed that after the petition was filed, an assessment order dated 25th May 2023 has already been passed. Since we have held that the notice issued under Section 148 of the Act itself is not valid, the consequential assessment order cannot be sustained. The same is also quashed and set aside.

7.

Petition disposed.

8.

Consequently, all pending applications, if any, also stand disposed. (SANDEEP TANEJA),J (K.R. SHRIRAM),CJ 12-pooja/- Powered by TCPDF (www.tcpdf.org) (Uploaded on 23/09/2025 at 05:23:41 PM) (Downloaded on 27/10/2026 at 11:16:35 PM)

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