PURAN CHAND vs. PRINCIPAL COMMISSIONER OF INCOME TAX 1- JODHPUR (PCIT JODHPUR)

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CW/12952/2025HC Rajasthan2025:RJ-JD:31668-DB18 July 20254 pages
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What did the High Court hold?

The Tribunal held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed. It was decided that the Joint Assessing Officer (JAO) does not have the jurisdiction to issue notices under Section 148 of the Act, as this would weaken Section 151A and potentially lead to its diminished activation. The court emphasized that for assessment and reassessment under Sections 147, 148, and 148A, in light of the sanction under Section 151A, adherence must be made to the algorithm-based random assessing system. Consequently, the impugned notices were quashed and set aside concerning the jurisdiction of JAOs. The respondents were granted liberty to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, keeping the FAO as the assessing officer. The ratio is that jurisdictional errors in notices issued under Section 148, violating the automated allocation mandate of Section 151A, render such notices invalid.

What were the facts?

The petitioner, Puran Chand, filed a writ petition before the Rajasthan High Court at Jodhpur challenging notices issued by the Income Tax Department. The respondents include various income tax authorities, including the Principal Commissioner of Income Tax and the Income Tax Officer. The core of the dispute revolves around the jurisdiction to issue notices under Section 148 of the Income Tax Act, 1961, in the context of faceless assessment schemes. The petitioner argued that the notices were issued by an incorrect authority, leading to a jurisdictional error. The court noted that this issue was not new and had been decided by a Division Bench of the same court in a previous writ petition.

What were the issues?

1. Whether the Joint Assessing Officer (JAO) has the jurisdiction to issue notices under Section 148 of the Income Tax Act, 1961, in light of Section 151A and the faceless assessment scheme? Assessee's Contention (implied from the judgment's reasoning): The notices issued under Section 148 of the Act by the JAO are invalid due to a jurisdictional error, as the faceless assessment scheme, particularly Section 151A, mandates an automated and randomized allocation of jurisdiction to the Faceless Assessing Officer (FAO). Revenue's Contention: Not recorded in the judgment. The judgment states that both counsels were ad idem that the issue was already adjudicated.

Which sections of the Income-tax Act were involved?

Section 151A,Section 144B,Section 147,Section 148,Section 148A

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
[2025:RJ-JD:31668-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 12952/2025 Puran Chand S/o Lekh Ram, Aged About 50 Years, Ward 3, Chak 3 Ml, 2Ml, Nathwala, District Ganganagar, Rajasthan ----Petitioner Versus 1. Principal Commissioner Of Income Tax 1- Jodhpur (Pcit Jodhpur), Aayakar Bhawan Paota C Road, Jodhpur 2. Principal Chief Commissioner Of Income Tax (National E- Assessment Center), 2Nd Floor, E-Ramp, Jawaharlal Nehru Stadium, Delhi - 110003 3. Central Board Of Direct Taxes, Cbdt Headquarters North Block (Department Of Revenue), New Delhi - 110001 4. Additional Commissioner Of Income Tax - Range 1, Aaykar Bhawan, Rani Bazar, Bikaner - 334001 5. Income Tax Officer, Ito Ward 1, Sri Ganganagar ----Respondents For Petitioner(s) : Mr. Sharad Kothari For Respondent(s) : Mr. K.K. Bissa HON'BLE MR. JUSTICE SANJEEV PRAKASH SHARMA HON'BLE MR. JUSTICE SANDEEP SHAH

Order 18/07/2025 The issue raised in the present petition is no more res integra. Both the counsels are ad idem that the issue stands finally adjudicated by a Division Bench of this Court in DB Civil Writ Petition No.11787/2024 and connected petitions, wherein this Court has held as under :

“15. This Court also observes that the FAO has been assigned specific jurisdiction and the Scheme dated 29.03.2022 also clearly indicates that the FAO has to be the jurisdictional authority. (Uploaded on 21/07/2025 at 10:30:24 AM) (Downloaded on 27/10/2026 at 11:16:40 PM)

[2025:RJ-JD:31668-DB] (2 of 4) [CW-12952/2025] The opening of multiple jurisdictional avenues will not only lead to confusion, but will also result into a failure on the part of the Revenue, to give a concrete opportunity to the assessee. The concurrent jurisdiction of FAO and the JAO, if accepted, would defeat the very purpose of statutory provisions i.e. Sections 151A & 144B of the Act of 1961. The words carefully chosen by CBDT, include ‘automated allocation’, and the baseline for the same being ‘algorithm for randomized allocation’, clearly show that the technology was supposed to be used for the purpose of allocating jurisdiction to a random officer.

16.

This Court is of the opinion that Section 151A of the Act of 1961 deals with the assessment, reassessment and re-computation provided in Sections 147 & 148 of the Act of 1961, and therefore, the same has to be faceless and the FAO has to have an exclusive jurisdiction to issue the notices.

17.

The Scheme to the extent of Section 144B of the Act of 1961 for issuance of notice cannot be said to be relevant for the purpose of issuing notices under Section 147 & 148 of the Act of 1961. Sections 147 & 148 have been kept separately. The restrictions provided for the purpose of Section 144B shall be relevant.

18.

This Court further observes that any jurisdictional error in the notices has to be cured and thus, the notices which have been issued for assessment and reassessment and which are the impugned notices under Section 148 of the Act of 1961, do not withstand the broader scheme of law, which requires automated allocation based on algorithm and random assignment of the assessing officer. Part 2(i)(a) of the Scheme clear demarcates as to how the assessment and reassessment has to take place.

19.

This Court is conscious of the fact that any reform or change for betterment is always resisted by the persons in control, particularly (Uploaded on 21/07/2025 at 10:30:24 AM) (Downloaded on 27/10/2026 at 11:16:40 PM)

[2025:RJ-JD:31668-DB] (3 of 4) [CW-12952/2025] those who do not visualize the pragmatic and progressive paths which require vision and wisdom. The legislature in its own vision and wisdom, for enhancing the efficiency of the taxation system by making it more transparent and impartial, decided to have infused technology in the shape of an algorithm for randomised allocations of cases, by using suitable technological tools, including artificial intelligence and machine learning, with a view to optimise the use of resources. The common tendency to cling to control and old methods has to be dealt with firmly and ways & means including loopholes to fall back upon the old regime of control is an imminent danger which has to be thwarted off. The legislative intention, legislative vision and legislative wisdom has to be given full meaning in terms of technology and progressiveness, and thus, once an effective and strong step has been taken towards faceless regime, then maintaining the strings of local control to the prejudice of a common man would not only undermine the legislative wisdom but the gains in terms of such a progressive and pragmatic step would stand to reduce. Once the gear of progress has been applied in a democratic set up, the same has to be strongly supported and sustained. The CBDT Circular read with Section 151A of the Act of 1961 has to be given full meaning and any ways & means to defeat the technology or to manually try to control the same would go against the legislative purpose.

20.

Thus, this Court holds that the mandate of Section 151A of the Act of 1961 has to be strictly followed as there cannot be a way out of doing the same. This Court also holds that the JAO shall not have the jurisdiction to issue notices under Section 148 of the Act of 1961, as it would not only render Section 151A weak, but may also lead to its diminishing activation. For the purpose of assessment and reassessment under Sections 147, 148 & 148A and in light of the sanction under Section 151A, adherence has to be made to algorithm based random assessing system, and (Uploaded on 21/07/2025 at 10:30:24 AM) (Downloaded on 27/10/2026 at 11:16:40 PM)

[2025:RJ-JD:31668-DB] (4 of 4) [CW-12952/2025] therefore, the impugned notices deserve to be quashed.

21.

Consequently, the present writ petitions are allowed. Accordingly, the impugned Notices are quashed and set aside, as far as the jurisdiction of JAOs for the purpose of Sections 148 & 148A of the Act of 1961 to issue the same is concerned. The question raised herein stands answered in the terms indicatedabove, with liberty to the respondents to issue fresh notices in compliance of the CBDT Notification dated 29.03.2022, by keeping the FAO as assessing officer.” Learned counsel also informs that other High Courts including Punjab and Haryana High Court in the case of Shikhar Gadh Vs. Income Tax Officer Ward-I, Yamuna Nagar reported in 2024:PHHC:153788-DB has also passed similar orders. In view of above, the present writ petition is allowed mutatis mutandis. (SANDEEP SHAH),J (SANJEEV PRAKASH SHARMA),J 6-deep-mahendra Powered by TCPDF (www.tcpdf.org) (Uploaded on 21/07/2025 at 10:30:24 AM) (Downloaded on 27/10/2026 at 11:16:40 PM)

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