THAR SHARE BROKERS PRIVATE LIMITED vs. ASSISTANT COMMISSIONER OF INCOME TAX

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CW/16866/2022HC RajasthanRJHC02091177202208 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 July 26, 2022, issued under Section 148 of the Income Tax Act, 1961. The court agreed with the petitioner that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO), and that such a notice is considered bad in law, following its own previous judgments in Shree Cement Limited, Sharda Devi Chhajer, and the Bombay High Court's decision in Hexaware Technologies Ltd. However, the court granted liberty to the revenue to revive the notice if the Supreme Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. The court also stated that if any re-assessment order were passed, it would also stand quashed and set aside. All rights and contentions of the parties were kept open.

What were the facts?

The petitioner, Thar Share Brokers Private Limited, filed a writ petition challenging a notice dated July 26, 2022, issued under Section 148 of the Income Tax Act, 1961. The petitioner argued that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO), rendering it invalid. The revenue, represented by the Assistant Commissioner of Income Tax and the Central Board of Direct Taxes, acknowledged that one of the grounds raised by the petitioner was covered by previous judgments of the High Court. The revenue also informed the court that a Special Leave Petition (SLP) had been filed against the Hexaware Technologies Ltd. judgment, and notice had been issued by the Supreme Court.

What were the issues?

1. Whether a notice dated July 26, 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 bad in law and invalid? (Question of law) Assessee's Contentions: The assessee argued that the notice under Section 148 was issued by a JAO and not an FAO, which is contrary to established legal principles and precedents, making the notice invalid. The assessee relied on the High Court's judgments in Shree Cement Limited, Sharda Devi Chhajer, and Hexaware Technologies Ltd. Revenue's Contentions: The revenue conceded that one of the grounds raised by the petitioner was covered by a judgment of the High Court. The revenue stated that an SLP had been filed against the Hexaware Technologies Ltd. judgment, and notice had been issued. The revenue requested liberty to revive the notice issued under Section 148 if the Apex Court were to interfere with the aforementioned 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:36087-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 16866/2022 Thar Share Brokers Private Limited, Having Office At F-32, Ajazad Marg, C-Scheme, Japur- 302001 Through Its Director Mr. Ajay Gangwal S/o Annup Chand Gangwal, Aged About 53 Years, R/o 112, Kailash Puri, Tonk Road, Jaipur. ----Petitioner Versus 1. Assistant Commissioner Of Income Tax, Circle-6, New Central Revenue Building, Bhagwan Dass Road, Jaipur Rajasthan 302005 2. Central Board Of Direct Taxes, Through Chairperson, Type-7, Bungalow No. 75, New Moti Bagh, New Delhi 110021 ----Respondents For Petitioner(s) : Mr. Rajat Sharma Advocate with Mr. Saksham Pandey Advocate. For Respondent(s) : Mr. Sandeep Pathak Advocate with Ms. Jaya P. Pathak Advocate & Mr. Palash Gupta Advocate. HON'BLE THE CHIEF JUSTICE MR. K.R. SHRIRAM HON'BLE MR. JUSTICE MANEESH SHARMA

Judgment 08/09/2025

1.

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

2.

Ground referred to is that the notice dated 26th July 2022 under Section 148 of the Income Tax Act, 1961 has been issued by a Juri ictional Assessing Officer (JAO) and not Faceless Assessing Offider (FAO) and this Court in the case of Shree Cement Limited Vs. Assistant Commissioner of Income-Tax

[2025:RJ-JP:36087-DB] (2 of 2) [CW-16866/2022] & 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.

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. Rajat Sharma 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 26th July 2022 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-SEEMA/43 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)

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