SQUARE INSURANCE BROKERS PRIVATE LIMITED vs. INCOME TAX OFFICER OF INCOME TAX DEPARTMENT ITO WD 1(1)

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CW/13121/2025HC RajasthanRJHC02073205202501 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 June 27, 2025, issued under Section 148 of the Income Tax Act, 1961. This decision was based on the established precedent of the Court in Shree Cement Limited, Sharda Devi Chhajer, and Hexaware Technologies Ltd., which held that notices issued by a Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) are invalid. The Court granted liberty to the Revenue to revive the notice if the Apex Court were to interfere with the aforementioned judgments. The petitioner reserved its right to raise other grounds at a later stage. The Court kept open all rights and contentions of the parties. Consequently, any re-assessment order passed would also stand quashed and set aside. The petition was disposed of, along with any pending applications.

What were the facts?

The petitioner, Square Insurance Brokers Private Limited, challenged a notice dated June 27, 2025, 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 respondent, Income Tax Officer, Ward 1(1), New Central Revenue Building, Jaipur, appeared on advance copy. The High Court of Judicature for Rajasthan, Bench at Jaipur, was hearing the writ petition. The procedural history involves the issuance of the notice and the subsequent challenge by the petitioner.

What were the issues?

1. Whether a notice dated June 27, 2025, 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, concerning the validity of the notice under Section 148 of the Income Tax Act, 1961). Assessee's contention: The notice issued by the JAO is invalid, relying on the High Court's judgments in Shree Cement Limited Vs. Assistant Commissioner of Income-Tax & Others and Sharda Devi Chhajer Vs. The Income Tax Officer & Another. The petitioner also reserves the right to raise other grounds at an appropriate stage. Revenue's contention: The respondent agrees that one ground is covered by a judgment of the Court. However, they state that a Special Leave Petition (SLP) has been preferred in the case of Hexaware Technologies Ltd. Vs. Assistant Commissioner of Income-tax, Circle 15(1)(2), and notice has been issued. The Revenue seeks liberty to revive the notice if the Apex Court interferes 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:34959-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 13121/2025 Square Insurance Brokers Private Limited, 506, 5Th Floor, Trimurty V-Jai City Point Ahinsa Circle, C-Scheme, Jaipur G.p.o. Jaipur 302001, Rajasthan- Through Rakesh Kumar S/o Padma Ram, Plot No. 74A, Block-A, Narayan Vihar A, Asarpura, Sanganer, Near Buniyad School, Gopalpura By-Pass, Narayan Vihar, Mansarovar, Jaipur, Rajasthan- 302020 ----Petitioner Versus Income Tax Officer Of Income Tax Department Ito Wd 1(1), New Central Revenue Building, Bhagwan Dass Road, Jaipur-302005 ----Respondent For Petitioner(s) : Mr. Sanjay Jhanwar, Senior Advocate assisted by Mr. Rajat Sharma, Mr. Shubhendra Singh & Mr. Saksham Pandey For Respondent(s) : Mr. Sandeep Pathak with Ms. Jaya P. Pathak & Mr. Palash Gupta HON'BLE THE CHIEF JUSTICE MR. K.R. SHRIRAM HON'BLE MR. JUSTICE MANEESH SHARMA

Order 01/09/2025

1.

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

2.

Ground referred to is that the notice dated 27th June 2025 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 & 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:34959-DB] (2 of 2) [CW-13121/2025] 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. 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. Jhanwar 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 27th June 2025 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 N.GANDHI/RAJAT/19 3 [2024] 162 taxmann.com 225 (Bombay)

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