RAM BABU GUPTA SON OF RAM KISHORE KHANDELWAL vs. DEPUTY COMMISSIONER OF INCOME TAX

PDF · subscribers
CW/17064/2024HC RajasthanRJHC02093357202408 September 2025Author: K.R. SHRIRAM,MANEESH SHARMA2 pages
AI SummaryRemanded

What did the High Court hold?

The Tribunal held that the penalty order, being a consequence of the re-assessment order, could not survive once the underlying notice under Section 148 of the Income Tax Act, 1961, was quashed. The Court noted that the re-assessment notice itself had been quashed in a separate writ petition (D.B. Civil Writ Petition No.2999/2024) decided on the same day, September 8, 2025. The reason for quashing the notice was that it was issued by the Jurisdiction Assessing Authority (JAO) rather than the Faceless Assessing Authority (FAO), following established precedents. Since the foundation of the penalty proceedings (the re-assessment order, which stemmed from the quashed notice) was invalidated, the penalty order was also rendered unsustainable. Accordingly, the penalty order dated September 20, 2024, was quashed and set aside. The petition was disposed of.

What were the facts?

The petitioner, Ram Babu Gupta, challenged a penalty order dated September 20, 2024. The penalty order was a consequence of a re-assessment order. The petitioner's counsel argued that the re-assessment order itself was based on a notice issued under Section 148 of the Income Tax Act, 1961, which had been quashed by the same Court in a separate writ petition (D.B. Civil Writ Petition No.2999/2024) decided on September 8, 2025. The basis for quashing the Section 148 notice was that it was issued by the Jurisdiction Assessing Authority (JAO) instead of the Faceless Assessing Authority (FAO), relying on precedents like Shree Cement Limited, Sharda Devi Chhajer, and Hexaware Technologies Ltd. The respondent's counsel conceded that the petitioner's submission was correct.

What were the issues?

1. Whether the penalty order, being a consequence of a re-assessment order, can survive when the underlying re-assessment notice under Section 148 of the Income Tax Act, 1961, has been quashed by the Court? (Question of law) Assessee's Contention: The petitioner argued that since the re-assessment notice under Section 148 of the Income Tax Act, 1961, was quashed by the Court in a separate proceeding, and the re-assessment order was a consequence of this quashed notice, the penalty order also had to be quashed. The petitioner relied on the decision in D.B. Civil Writ Petition No.2999/2024, which quashed the Section 148 notice on the grounds of it being issued by the JAO instead of the FAO, citing Shree Cement Limited Vs. Assistant Commissioner of Income-Tax & Others, Sharda Devi Chhajer Vs. The Income Tax Officer & Another, and Hexaware Technologies Ltd. Vs. Assistant Commissioner of Income-tax. Revenue's Contention: The respondent's counsel stated that what the petitioner's counsel said was correct.

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:35884-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 17064/2024 Ram Babu Gupta Son Of Ram Kishore Khandelwal, Aged About 60 Years, Having His Address At C-87, Sethi Colony, Jaipur. ----Petitioner Versus Deputy Commissioner Of Income Tax, Central Circle-1, Jaipur Having Its Address, 4Th Floor, Jeevan Nidhi, Lic Building, Ambedkar Circle, Jaipur. ----Respondent For Petitioner(s) : Mr. Aditya Vijay For Respondent(s) : Mr. Siddharth Bapna with Mr. Sarvesh Jain, Mr. Meyhul Mittal & Mr. Rahul Kumar HON'BLE THE CHIEF JUSTICE MR. K.R. SHRIRAM HON'BLE MR. JUSTICE MANEESH SHARMA

Order 08/09/2025

1.

Mr. Aditya Vijay, counsel for petitioner states that penalty order impugned in this petition is a consequence of the re- assessment order passed, which order has been quashed by this Court in D.B. Civil Writ Petition No.2999/2024-Ram Babu Gupta Commissioner of Income-Tax & Others1 following Sharda Devi Chhajer Vs. The Income Tax Officer & Another2 and 1 DB Civil Writ Petition No.10540/2024, dated 05.08.2025 at Jaipur Bench (unreported) 2 2025 SCCOnLine Raj 3386

[2025:RJ-JP:35884-DB] (2 of 2) [CW-17064/2024] Income-tax, Circle 15(1)(2)3. 2. Mr. Bapna states that what Mr. Aditya Vijay says is correct.

3.

In view thereof, as the notice itself has been quashed followed by the assessment order, penalty proceedings cannot survive and the same also has to be quashed.

4.

Accordingly, the penalty order dated 20th September 2024 is quashed and set aside.

5.

Petition disposed. (MANEESH SHARMA),J (K.R. SHRIRAM),CJ N.GANDHI/RAJAT/22 3 [2024] 162 taxmann.com 225 (Bombay)

More judgments on Section 148

All 35,022 judgments and leading authorities on Section 148 →

Recent GST High Court judgments

Search GST case law →