VIJAY PARAKH vs. THE DEPUTY COMMISSIONER OF INCOME TAX

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CW/22659/2025HC Rajasthan2025:RJ-JD:49830-DB18 November 2025Author: PUSHPENDRA SINGH BHATI, ANUROOP SINGHI5 pages
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What did the High Court hold?

The Rajasthan High Court quashed and set aside the notice dated 22.03.2025 issued under Section 148 of the Income Tax Act. The Court found that the facts of the Gujarat High Court case (Talati and Talati LLP) were entirely different from the present case. The Court distinguished the Gujarat High Court's reasoning, noting it was not based on a combined reading of the notification dated 29th March 2022 with earlier CBDT orders (dated 31st March 2021 and 06th September 2021), unlike the reasoning adopted by the Bombay High Court in Abhin Anilkumar Shah. The Court held that the Gujarat High Court's decision was based on a simpler reading of Explanation 2 to Section 148 and an understanding that FAO cannot fulfill the pre-requisites for issuing a Section 148 notice in search cases, a view with which the Rajasthan High Court respectfully disagreed. The Court also noted that the revenue had preferred a Special Leave Petition against the Hexaware Technologies Ltd. judgment, and sought liberty to revive the notice if the Apex Court interfered with the relevant judgments. The Court granted this liberty and disposed of the petition.

What were the facts?

The petitioner, Vijay Parakh, is challenging a notice dated 22.03.2025 issued under Section 148 of the Income Tax Act, 1961. The petitioner's primary contention is that the notice was issued by the Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO), rendering it invalid. The petitioner relies on previous judgments from the Rajasthan High Court (Shree Cement Limited and Sharda Devi Chhajer) which, in turn, followed a Bombay High Court decision (Hexaware Technologies Ltd.). The respondent revenue, represented by the Deputy Commissioner of Income Tax, argued that a Gujarat High Court judgment in Talati and Talati LLP took a different view, not interfering with a similar notice and directing the assessee to reply. The Rajasthan High Court noted that the Gujarat High Court's reasoning was based on a different understanding of the applicability of the e-assessment scheme to search and seizure cases.

What were the issues?

1. Whether a notice issued under Section 148 of the Income Tax Act, 1961, by the Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) is invalid, particularly in light of the e-assessment scheme? Assessee's Contentions: The petitioner argues that such a notice issued by the JAO is invalid, citing the judgments in Shree Cement Limited vs. Assistant Commissioner of Income-Tax & Others and Sharda Devi Chhajer vs. The Income Tax Officer & Another, which followed the Bombay High Court's decision in Hexaware Technologies Ltd. vs. Assistant Commissioner of Income-Tax. Revenue's Contentions: The respondent revenue relies on the Gujarat High Court judgment in Talati and Talati LLP vs. Office of Assistant Commissioner of Income Tax, which did not interfere with a similar notice under Section 148 and directed the assessee to file a reply. The revenue also points to the Gujarat High Court's reliance on Explanation 2 to Section 148, suggesting that automated allocation under the faceless regime cannot apply to search and seizure cases.

Which sections of the Income-tax Act were involved?

Section 148,Section 153A,Section 132,Section 132A,Section 151A

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
[2025:RJ-JD:49830-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 22659/2025 Vijay Parakh S/o Shri Pannalal Parakh, Aged About 42 Years, Resident Of Jain Bhawan, 1St A Road Sardarpura, Jodhpur, Rajathan-342003. ----Petitioner Versus The Deputy Commissioner Of Income Tax, Central Circle - 1, Jodhpur Having Its Address At Aayakar Bhawan, Paota C Road, Jodhpur, Rajasthan. ----Respondent For Petitioner(s) : Mr. Rajat Arora Mr. Dinesh Kumar Mr. Lucky Rajpurohit For Respondent(s) : Mr. K.K. Bissa with Mr. G.S. Chouhan HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI HON'BLE MR. JUSTICE ANUROOP SINGHI

Order 18/11/2025

1.

Learned counsel for the petitioner submits that petitioner is unhappy with notice dated 22.03.2025 issued under Section 148 of the Income Tax Act, 1961 (for short ‘the Act’).

2.

He further submits that apart from various grounds taken in the petition, one of the grounds is that notice has been issued by Jurisdictional Assessing Officer (JAO) and not Faceless Assessing Officer (FAO). He also submits that this Court in Shree Cement Limited vs. Assistant Commissioner of Income-Tax & Others and Sharda Devi Chhajer vs. The Income Tax Officer & Another following judgment of Bombay High Court in Hexaware Technologies Ltd. vs. Assistant Commissioner of Income-Tax, Circle 15(1)(2) has held that such a notice issued by JAO will be invalid. (Uploaded on 21/11/2025 at 04:53:02 PM) (Downloaded on 28/10/2026 at 12:34:13 AM)

[2025:RJ-JD:49830-DB] (2 of 5) [CW-22659/2025] 3. contention that pre-requisite conditions before issuance of notice under Section 148, as provided in Explanation 2 of Section 148 would require (Uploaded on 21/11/2025 at 04:53:02 PM) (Downloaded on 28/10/2026 at 12:34:13 AM)

[2025:RJ-JD:49830-DB] (3 of 5) [CW-22659/2025] human application of mind and cannot be fulfilled by algorithm under the Faceless Regime.

7.

The decision of the Division Bench of the Bombay High Court in the case of Hexaware Technologies Ltd. (supra) has been distinguished as having been rendered in a case, which falls within the arena of Explanation 1 to Section 148 and not where Explanation 2 to Section 148 of the Income Tax Act' 1961, would be attracted.

8.

Ward Circle-4(2)(1), Mumbai and Ors. where the orders dated 31st March 2021 and 06th September 2021 issued by the CBDT creating exception for the assessment proceedings undertaken by the International taxation charges/Central Charges were subject matter of deliberation.

9.

In Abhin Anilkumar Shah (supra) the Court held that said orders dated 31st March 2021 and 06th September 2021 issued by the CBDT only carve out exception in relation to the assessment proceedings. What has been done by order dated 06th September 2021 is to modify the order dated 31st March 2021 to the extent of what is set out in paragraph 3 thereof, namely, that in addition to such exceptions to the applicability of the faceless mechanism to assessment orders in relation to Central Charges and International Tax Charges, an additional exception was added, namely, to the assessment order in cases where pendency could not be created on ITBA because of technical reasons or cases not having a PAN, as the case may be. Thus, the scheme as framed under section 151A and notified under the notification dated 29th March 2022 does not include the applicability, inclusion or even reference to the orders dated 31st March 2021 and 06th September (Uploaded on 21/11/2025 at 04:53:02 PM) (Downloaded on 28/10/2026 at 12:34:13 AM)

[2025:RJ-JD:49830-DB] (4 of 5) [CW-22659/2025] 2021. It was further held that it would be doing violence to the language of the notification/scheme dated 29th March 2022 to read into such notification what has not been expressly provided for and/or dated 31st March 2021/ 06th September 2021 but is based on the simple reading of Explanation 2 to Section 148 along with understanding that the pre-requisites for issuing notice under Section 148 in search cases cannot be met by the FAO. With due respect, we do not agree.

12.

In these circumstances, notice dated 22.03.2025 passed under Section 148 of the Act is liable to be quashed and set aside.

13.

At this stage, Mr. Bissa submits that in judgment of 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.

14.

In view of above, counsel for petitioner states that other grounds raised are not being pressed upon and they will be taken at appropriate stage, if required. (Uploaded on 21/11/2025 at 04:53:02 PM) (Downloaded on 28/10/2026 at 12:34:13 AM)

[2025:RJ-JD:49830-DB] (5 of 5) [CW-22659/2025]

15.

Therefore, keeping open all rights and contentions of parties, we quash and set aside notice dated 22.03.2025 passed under Section 148 of the Act with liberty as prayed.

16.

Petition disposed.

17.

Consequently, all pending applications, if any, also stand disposed. (ANUROOP SINGHI),J (DR. PUSHPENDRA SINGH BHATI),J 96-Sudheer/- Powered by TCPDF (www.tcpdf.org) (Uploaded on 21/11/2025 at 04:53:02 PM) (Downloaded on 28/10/2026 at 12:34:13 AM)

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