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

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CW/15753/2022HC RajasthanRJHC02085520202208 September 2025Author: K.R. SHRIRAM,MANEESH SHARMA2 pages
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What did the High Court hold?

The Tribunal quashed and set aside the notice dated July 26, 2022, issued under Section 148 of the Income Tax Act, 1961. The reasoning was based on the concession made by the revenue that the issue was covered by the High Court's own judgment in Shree Cement Limited, which relied on Sharda Devi Chhajer and Hexaware Technologies Ltd., holding that notices issued by a JAO instead of an FAO are invalid. The Court granted the petitioner's prayer for the present. However, the revenue was granted liberty to revive the notice if the Apex Court were to overturn the aforementioned judgments. The Court kept open all rights and contentions of the parties and disposed of the petition. Any re-assessment order passed would also stand quashed and set aside. No other issues were expressly left undecided.

What were the facts?

The petitioner, Ridhi 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 contended that the notice was issued by a Jurisdictional Assessing Officer (JAO) and not a Faceless Assessing Officer (FAO). The respondents are the Assistant Commissioner of Income Tax and the Central Board of Direct Taxes. The High Court of Judicature for Rajasthan, Bench at Jaipur, considered the matter. The amount in dispute is not specified. The procedural history involves the filing of the writ petition and the arguments presented by both sides.

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 valid? (Question of law) Assessee's Contentions: The assessee argued that the notice under Section 148 was issued by a JAO and not an FAO, making it invalid. They relied on the High Court's judgment in Shree Cement Limited, which followed Sharda Devi Chhajer and Hexaware Technologies Ltd., holding such notices to be bad in law. Revenue's Contentions: The revenue conceded that one of the grounds raised by the petitioner was covered by the High Court's judgment. They acknowledged that in Hexaware Technologies Ltd., a Special Leave Petition was filed and notice issued. The revenue requested liberty to revive the Section 148 notice if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited.

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:36079-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 15753/2022 Ridhi Share Brokers Private Limited, Having Office At A-40A, Bajaj Nagar, Opposite Gandhi Nagar Railway Station, Jaipur 302015 Through Its Authorized Representative Budhi Prakash Sharma S/o Harsh Narayan Sharma, Aged About 76 Years R/o A- 29 Nulite Colony, Tonk Road, Jaipur 302018 ----Petitioner Versus 1. Assistant Commissioner Of Income Tax, Circle-6 New Central Revenue Building, Bhagwan Das 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:36079-DB] (2 of 2) [CW-15753/2022] & 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/41 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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