R.S. ENTERPRISES vs. INCOME TAX OFFICER

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CW/6861/2024HC RajasthanRJHC02036104202409 September 2025Author: K.R. SHRIRAM,MANEESH SHARMA2 pages
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What did the High Court hold?

The High Court quashed and set aside the notice dated March 31, 2024, issued under Section 148 of the Income Tax Act, 1961. The court acknowledged that the ground raised by the petitioner regarding the notice being issued by a JAO instead of an FAO was covered by its own prior judgments, specifically Shree Cement Limited, Sharda Devi Chhajer, and Hexaware Technologies Ltd. The court granted the revenue's request for liberty to revive the notice. This liberty is contingent on the outcome of the Special Leave Petition filed before the Supreme Court concerning the Hexaware Technologies Ltd. judgment. If the Apex Court's decision modifies or overturns the High Court's rulings in the cited cases, the revenue will have the right to revive the notice. The court explicitly stated that all rights and contentions of both parties were kept open. Any reassessment order passed subsequently would also stand quashed and set aside.

What were the facts?

The petitioner, R.S. Enterprises, challenged a notice dated March 31, 2024, issued under Section 148 of the Income Tax Act, 1961, by the Income Tax Officer, Ward 4(2), Jaipur. The petitioner argued that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO). The respondent revenue conceded that one of the grounds raised by the petitioner was covered by a previous judgment of the High Court. The revenue also informed the court that a Special Leave Petition (SLP) had been filed before the Supreme Court concerning the relevant precedent, and notice had been issued. The revenue sought liberty to revive the notice if the Supreme Court's decision differed from the High Court's.

What were the issues?

1. Whether a notice issued under Section 148 of the Income Tax Act, 1961, by a Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) is invalid? (Question of law) Assessee's Contention: The notice dated March 31, 2024, issued under Section 148 is bad and not valid because it was issued by a JAO and not an FAO. This contention is supported by the High Court's judgment in Shree Cement Limited Vs. Assistant Commissioner of Income-Tax & Others, which followed Sharda Devi Chhajer Vs. The Income Tax Officer & Another and Hexaware Technologies Ltd. Vs. Assistant Commissioner of Income-tax. Revenue's Contention: The revenue agreed that one of the grounds raised by the petitioner was covered by a judgment of the High Court. While acknowledging the current legal position, the revenue informed the court that an SLP had been filed in the Supreme Court regarding the Hexaware Technologies Ltd. case, and notice had been issued. The revenue requested liberty to revive the Section 148 notice if the Supreme Court's decision altered the current legal position established in the cited High Court judgments.

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-JP:36385-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 6861/2024 R.s. Enterprises, 1/455, Vidyadhar Nagar, Jaipur-302012 (Raj.), Through Its Partner - Mr. Rahul Gupta S/o Shri Jagdish Prasad Gupta. ----Petitioner Versus Income Tax Officer, Ward 4(2), Jaipur, New Bhagwan Das Road, Jaipur, Rajasthan - 302005 ----Respondent For Petitioner(s) : Mr. Aditya Vijay Advocate. For Respondent(s) : Mr. Sandeep Pathak Advocate with Mr. Palash Gupta Advocate. HON'BLE THE CHIEF JUSTICE MR. K.R. SHRIRAM HON'BLE MR. JUSTICE MANEESH SHARMA

Order 09/09/2025

1.

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

2.

Ground referred to is that the notice dated 31th March 2024 under Section 148 of the Income Tax Act, 1961 has been issued by a Juri ictional 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. 1 DB Civil Writ Petition No.10540/2024, dated 05.08.2025 at Jaipur Bench (unreported) 2 2025 SCCOnLine Raj 3386

[2025:RJ-JP:36385-DB] (2 of 2) [CW-6861/2024] Assistant Commissioner of Income-tax, Circle 15(1)(2)3, has held that such a notice will be bad and not valid.

3.

At the same time, Mr. Sandeep Pathak 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. Aditya Vijay 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 31th March 2024 issued under Section 148 of the Act with liberty as prayed.

6.

Petition disposed.

7.

Consequently, all pending applications, if any, also stand disposed.

8.

In case, if any re-assessment order is passed, the same will also stand quashed and set aside. (MANEESH SHARMA),J (K.R. SHRIRAM),CJ SANJAY KUMAWAT/53 3 [2024] 162 taxmann.com 225 (Bombay)

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