ANIL SINGHVI vs. DEPUTY COMMISSIONER OF INCOME-TAX

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CW/22211/2025HC Rajasthan2025:RJ-JD:48807-DB12 November 2025Author: PUSHPENDRA SINGH BHATI, ANUROOP SINGHI6 pages
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What did the High Court hold?

The High Court of Rajasthan at Jodhpur quashed and set aside the notice dated 15.02.2024 issued under Section 148 and the assessment order dated 18.03.2025 passed under Section 147, along with consequential proceedings. The Court found the facts of the Gujarat High Court case (Talati and Talati LLP) to be entirely different from the present case. The Court noted that the Gujarat High Court's reasoning was based on a reading of Explanation 2 to Section 148 and an understanding that pre-requisites for issuing a notice under Section 148 in search cases could not be met by the FAO. The Rajasthan High Court disagreed with this reasoning, finding it not based on a comprehensive reading of the relevant notifications and orders, particularly in light of the Bombay High Court's decisions in Hexaware Technologies Ltd. and Abhin Anilkumar Shah, which dealt with exceptions to the faceless regime. The Court held that the notice issued by the JAO was invalid. The Revenue sought liberty 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 granted this liberty and disposed of the petition.

What were the facts?

The petitioner, Anil Singhvi, is challenging a notice dated 15.02.2024 issued under Section 148 and an assessment order dated 18.03.2025 passed under Section 147 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 the Faceless Assessing Officer (FAO), rendering it invalid. The petitioner relies on decisions from the Rajasthan High Court (Shree Cement Limited and Sharda Devi Chhajer) and the Bombay High Court (Hexaware Technologies Ltd.) which held such notices issued by JAO to be invalid. The Revenue, represented by Mr. Bissa, cited a Gujarat High Court judgment in Talati and Talati LLP, which did not interfere with a similar notice but directed the assessee to file a reply.

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, thereby rendering the subsequent assessment order passed under Section 147 bad in law? Assessee's Contention: The petitioner argues that notices issued by JAO are invalid, citing Shree Cement Limited vs. Assistant Commissioner of Income-Tax & Others and Sharda Devi Chhajer vs. The Income Tax Officer & Anr., which followed the Bombay High Court's decision in Hexaware Technologies Ltd. vs. Assistant Commissioner of Income-Tax. They contend that any assessment order based on such an invalid notice is also bad in law. Revenue's Contention: The respondent relies on the Gujarat High Court's judgment in Talati and Talati LLP vs. Office of Assistant Commissioner of Income Tax, which, while considering a similar notice, did not interfere but directed the assessee to respond. The Revenue also argued that Explanation 2 to Section 148, as it existed, supported the concept of automated allocation and could not be applied in search and seizure cases under Section 132, implying a need for human application of mind by the JAO.

Which sections of the Income-tax Act were involved?

Section 148,Section 147,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:48807-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 22211/2025 Anil Singhvi S/o Prakash Chand Singhvi, Aged About 44 Years, Baktawar Mal Ji Ka Bag, Chopasni Road, Jodhpur - 342001 ----Petitioner Versus 1. Deputy Commissioner Of Income-Tax, Central Circle - 1, Aaykar Bhawan, Paota C Road, Jodhpur. 2. The Commissioner Of Income-Tax (Apeals), Jaipur Aaykar Bhawan, Lic Building -2 Bhawani Singh Road, Ambedkar Circle, Jaipur. ----Respondents For Petitioner(s) : Mr. Anjay Kothari For Respondent(s) : Mr. K.K. Bissa HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI HON'BLE MR. JUSTICE ANUROOP SINGHI

Order 12/11/2025

1.

Learned counsel for the petitioner submits that petitioner is unhappy with notice dated 15.02.2024 issued under Section 148 and assessment order dated 18.03.2025 passed under Section 147 of the Income Tax Act, 1961 (for short ‘the Act’).

2.

Income-Tax & Others (D.B. Civil Writ Petition No.10540/2024, dated 05.08.2025, at Jaipur Bench) and Sharda Devi Chhajer vs. The Income Tax Officer & Anr., reported in 2025 (Uploaded on 18/11/2025 at 06:02:21 PM) (Downloaded on 28/10/2026 at 12:37:38 AM)

[2025:RJ-JD:48807-DB] (2 of 6) [CW-22211/2025] of Income-Tax, Circle 15(1)(2), reported in (2024) 162 held that notification dated 29th March 2022 (prescribing e- assessment scheme) does not cover a case where notice under Section 148 is issued by the JAO, the information received by him in the matter of search and seizure under Section 132 of the Act, 1961, or requisitioned under Section 132A.

5.

The Gujarat High Court has relied on Explanation 2 to Section 148 (as it existed at the relevant time) to approve the contention of the Revenue that the concept of automated allocation, i.e. application of algorithm for randomized allocation of cases by using suitable technological tools including Artificial (Uploaded on 18/11/2025 at 06:02:21 PM) (Downloaded on 28/10/2026 at 12:37:38 AM)

[2025:RJ-JD:48807-DB] (3 of 6) [CW-22211/2025] Intelligence and Machine Learning, as defined in Clause 2(1)(b) of the Scheme dated 29th March 2022, cannot be applied in a case of search and seizure under Section 132. 6. While upholding the said contention the Gujarat High Court was perhaps under an understanding that the FAO does not draw a satisfaction note before proceeding to issue a notice under Section 148 in search cases. The Gujarat High Court has taken cognizance of the contention that pre-requisite conditions before issuance of notice under Section 148, as provided in Explanation 2 of Section 148 would require 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 International Tax Ward Circle-4(2)(1), Mumbai and Ors. reported in (2024) 468 ITR 350 (Bom) 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 (Uploaded on 18/11/2025 at 06:02:21 PM) (Downloaded on 28/10/2026 at 12:37:38 AM)

[2025:RJ-JD:48807-DB] (4 of 6) [CW-22211/2025] 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 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 something which is kept outside the purview of the said with orders dated 31st March 2021/ 06th September 2021 but is based on the simple reading of Explanation 2 to Section 148 along (Uploaded on 18/11/2025 at 06:02:21 PM) (Downloaded on 28/10/2026 at 12:37:38 AM)

[2025:RJ-JD:48807-DB] (5 of 6) [CW-22211/2025] 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 15.02.2024 issued under Section 148 and assessment order dated 18.03.2025 passed under Section 147 of the Act along with consequential proceedings are 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.

15.

Therefore, keeping open all rights and contentions of parties, we quash and set aside notice dated 15.02.2024 issued under Section 148 and assessment order dated 18.03.2025 passed under Section 147 of the Act along with consequential proceedings, with liberty as prayed.

16.

In view of above, learned counsel for the petitioner undertakes to apply within two weeks to withdraw the appeal already filed.

17.

Undertaking accepted. (Uploaded on 18/11/2025 at 06:02:21 PM) (Downloaded on 28/10/2026 at 12:37:38 AM)

[2025:RJ-JD:48807-DB] (6 of 6) [CW-22211/2025]

18.

Petition disposed.

19.

Consequently, all pending applications, if any, also stand disposed. (ANUROOP SINGHI),J (DR. PUSHPENDRA SINGH BHATI),J 1-Taruna/- Powered by TCPDF (www.tcpdf.org) (Uploaded on 18/11/2025 at 06:02:21 PM) (Downloaded on 28/10/2026 at 12:37:38 AM)

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