LIQUIDATOR MIRAJ URBAN COOPERATIVE BANK LTD vs. ASST. COMMISSIONER OF INCOME TAX CIRCLE SANGLI AND ORS

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WP/6061/2023HC BombayHCBM07021154202328 July 2025Author: HON'BLE SHRI JUSTICE B.P. COLABAWALLA,HON'BLE SHRI JUSTICE FIRDOSH PHIROZE POONIWALLA3 pages
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What did the High Court hold?

The Bombay High Court, following its own Division Bench decision in Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, held that the impugned Notice issued under Section 148 of the Income Tax Act, 1961, was invalid. The Court found itself bound by the precedent set in Hexaware Technologies Ltd. Consequently, the Court quashed the Notice and all proceedings/orders emanating therefrom. The Court granted liberty to the Revenue to revive the Writ Petition if the Supreme Court sets aside the Hexaware Technologies Ltd. decision. If the Supreme Court dismisses the SLP challenging Hexaware, there will be no revival. The Court clarified that upon revival, the petition would be decided on its merits, considering other issues raised. The operative direction was to set aside the impugned Notice and proceedings.

What were the facts?

The petitioner, the Liquidator of Miraj Urban Co-operative Bank Ltd., filed a Writ Petition challenging a Notice issued under Section 148 of the Income Tax Act, 1961. The primary ground for challenge was that the Notice was issued by the Jurisdictional Assessing Officer, whereas the law mandates it to be issued by a Faceless Assessing Officer. The petitioner argued this was a fatal defect. The assessment year(s) are not specified. The Revenue acknowledged that the issue was covered by a Division Bench decision of the Bombay High Court in Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, but stated this decision was challenged before the Supreme Court, though no stay was granted.

What were the issues?

1. Whether the Notice issued under Section 148 of the Income Tax Act, 1961, is invalid because it was issued by the Jurisdictional Assessing Officer instead of the Faceless Assessing Officer, as mandated by law? (Question of law) Assessee's contention: The Notice is invalid due to being issued by the wrong authority, citing the decision in Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2) [(2024) 162 taxmann.com 225 (Bombay)] as covering this issue. Revenue's contention: While acknowledging the Hexaware Technologies Ltd. decision, the Revenue stated it has been challenged before the Supreme Court and is likely to be heard soon. They admitted there is no stay on the Hexaware judgment.

Which sections of the Income-tax Act were involved?

Section 148

AI-generated summary — verify with the full judgment below

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURI ICTION WRIT PETITION NO.6061 OF 2023 The Liquidator, Miraj Urban Co-operative Bank Ltd., .. Petitioner. Versus Assistant Commissioner of Income Tax Circle Sangli & Ors. .. Respondents. Adv. Deepak Khare i/b. Mint and Confreres, for the Petitioner. Adv. Arjun Gupta, for the Respondents.

CORAM: B. P. COLABAWALLA & FIRDOSH P. POONIWALLA, JJ. DATE: JULY 28, 2025 P. C. 1 Mentioned. Taken out of turn. 2 Rule. Respondents waive service. With the consent of the parties, Rule made returnable forthwith and heard finally. 3 The above Writ Petition interalia challenges the Notice issued under Section 148 of the Income Tax Act, 1961 on various grounds. One of the grounds is that the Notice has been issued by the Juri ictional Assessing Officer when the law mandates that it has to be issued by the Faceless Assessing Officer. This is a fatal defect and therefore the Notice has to be quashed, is the argument of the Petitioner. JULY 28, 2025 S.R.JOSHI SMITA RAJNIKANT JOSHI RAJNIKANT JOSHI Date: 2025.07.30 11:29:08 +0530

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4 It is the Petitioners’ contention that this issue is squarely covered by a decision of a Division Bench of this Court in the case of Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2) [(2024) 162 taxmann.com 225 (Bombay)]. 5 On the other hand, the learned advocate appearing on behalf of the Revenue stated that though it is true that this issue is concluded by the decision in Hexaware Technologies Ltd (supra), the said decision has been challenged before the Hon’ble Supreme Court, and the Hon’ble Supreme Court is likely to take up the matter immediately on re-opening. He has fairly stated that there is no stay to the judgment in Hexaware Technologies Ltd (supra). 6 Considering these facts, we do not propose to keep the matter pending in this Court. Once it is fully covered by the decision in Hexaware Technologies Ltd (supra) we are bound to follow it. 7 We accordingly set aside the impugned Notice issued under Section 148 and all other proceedings/orders emanating therefrom. 8 We however grant liberty to the Revenue to revive the above Writ Petition in the event the decision in Hexaware Technologies Ltd (supra) is set aside by the Hon’ble Supreme Court on this issue. We make it clear JULY 28, 2025 S.R.JOSHI

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that it will not be necessary for the Revenue to file a separate Interim Application to seek a revival of this Petition and the same can be done simply by moving a Praecipe before this Court. It is needless to clarify that if the Hon’ble Supreme Court dismisses the SLP challenging the decision in Hexaware Technologies Ltd (Supra), there would be no question of any revival. 9 We also make it clear that once the Petition is revived and restored, the same would have to be decided on its own merits considering that several other issues are also raised challenging the Notice issued under Section 148. 10 Rule is accordingly made absolute and the Writ Petition is also disposed of in terms thereof. However, there shall be no order as to costs. 11 This order will be Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order. [FIRDOSH P. POONIWALLA, J.] [B. P. COLABAWALLA, J.] JULY 28, 2025 S.R.JOSHI

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