GAJANAN SAHEBRAO MORE vs. INCOME TAX OFFICER AND OTHERS

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WP/358/2023HC BombayHCBM03034823202230 July 2024Author: HON'BLE SHRI JUSTICE RAVINDRA V. GHUGE,HON'BLE SHRI JUSTICE Y. G. KHOBRAGADE3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the notice issued under Section 148 of the Income Tax Act, 1961, is unsustainable and quashed and set it aside. The Court relied on its previous judgment in the case of Hexaware Technologies Limited Vs. the Assistant Commissioner of Income Tax and Others, which ruled that a notice under Section 148, if not issued by the Faceless Assessing Officer (FAO) in accordance with the scheme framed under Section 151(A), is unsustainable. Consequently, any further demand notice or penalty notice issued in furtherance of the impugned notice also stands set aside. The Court clarified that all contentions available to the parties in a proceeding that can be initiated by the FAO under Section 151(A) are left open, except for those covered by the Hexaware Technologies judgment. The ratio decidendi is that notices issued under Section 148 must adhere to the faceless assessment scheme, and non-compliance renders them invalid.

What were the facts?

The assessee, Gajanan Sahebrao More, filed a Writ Petition challenging a notice under Section 148 of the Income Tax Act, 1961, dated 25/07/2022, pertaining to the assessment year 2013-2014. The notice was issued beyond six years from the relevant assessment year. The petition raised several issues, including the contention that the notice could not have been issued by the Jurisdictional Assessing Officer (JAO) but should have been issued by the Faceless Assessing Officer (FAO) in terms of Section 151(A) of the Act. The procedural history involves the issuance of the notice by the Income Tax Officer and the subsequent challenge by the assessee.

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 (JAO) instead of the Faceless Assessing Officer (FAO) in accordance with the scheme framed under Section 151(A) of the Act? Assessee's Contention: The assessee argued that the notice under Section 148 could only be issued by the Faceless Assessing Officer (FAO) as per the provisions of Section 151(A) of the Income Tax Act, 1961. The issuance by the JAO renders the notice unsustainable. Revenue's Contention: The judgment does not record specific arguments from the revenue regarding this issue, but it notes that the learned advocates for the respective sides submit that the judgment in Hexaware Technologies Limited Vs. the Assistant Commissioner of Income Tax and Others settles this issue.

Which sections of the Income-tax Act were involved?

Section 148,Section 151(A)

AI-generated summary — verify with the full judgment below

358.

23wp (1) IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD

907 WRIT PETITION NO. 358 OF 2023 GAJANAN SAHEBRAO MORE VERSUS INCOME TAX OFFICER AND OTHERS …. Mr Ram Deepak Heda, Advocate for Petitioner Mr Alok Sharma, Advocate for Respondent Nos.1, 2 & 4

CORAM : RAVINDRA V. GHUGE AND Y. G. KHOBRAGADE, JJ.

DATE : 30th July, 2024 PER COURT:

1.

In this Writ Petition, the impugned notice under Section 148 of the Income Tax Act, 1961, is dated 25/07/2022, for the assessment year 2013-2014. Notice by the Department is issued beyond six years.

2.

We have heard the learned Advocates for the respective sides. Several issues have been raised in this Petition, inter alia, that the impugned notice could not have been issued by the Jurisdictional Assessing Officer (JAO) and which could have been issued in terms of the provisions of Section 151(A) of the 2024:BHC-AUG:16886-DB

358.

23wp (2) Income Tax Act, 1961 by the Faceless Assessing Officer (FAO). The issue of the delayed issuance of the notice is also covered by the Judgment delivered by this Court at the Principal Seat on 15/01/2024 in Writ Petition No.1945/2023 (The New India that the judgment dated 03/05/2024, delivered at the Principal Seat in WP No.1778/2023 (Hexaware Technologies Limited Vs. the Assistant Commissioner of Income Tax and Others), settles this issue. The notice could not have been issued, save and except, by the Faceless Assessing Officer. If it is not issued by the FAO, this Court has ruled in Hexaware Technologies (supra), that such notice is unsustainable and, accordingly, the notice was quashed and set aside.

4.

It is, thus, obvious that the ground that the notice is not in accordance with the scheme framed u/s 151(A) of the Income Tax Act, 1961, is covered by the view taken in Hexaware Technologies (supra).

358.

23wp (3)

5.

In view of the above and considering the conclusions drawn in Hexaware Technologies (supra), the notice issued u/s 148 would be unsustainable. The same is, therefore, quashed and set aside. Any further demand notice or penalty notice in furtherance thereof, would also not survive and stands set aside, if any.

6.

With the above directions, this Writ Petition is disposed off. Needless to state, all the contentions of both the sides, which are available to the parties in a proceeding, which can be initiated by the FAO under the scheme framed u/s 151(A) of the Income Tax Act, are left open, save and except, those which are covered by the Hexaware Technologies (supra). (Y. G. KHOBRAGADE, J.) (RAVINDRA V. GHUGE, J.) sjk

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