JAYANT VAMAN PADSALGIKAR vs. INCOME-TAX OFFICER WARD 2(3) , SOLAPUR AND ORS

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WP/6439/2025HC BombayHCBM07023983202523 July 2025Bench: HON'BLE SHRI JUSTICE B.P. COLABAWALLA,HON'BLE SHRI JUSTICE FIRDOSH PHIROZE POONIWALLA4 pages
AI SummaryRemanded

What did the High Court hold?

The Tribunal, bound by the Division Bench decision of the Bombay High Court in Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2), held that the impugned Notice issued under Section 148 of the Income Tax Act, 1961, was required to be set aside. The reasoning was that the law mandates issuance by a Faceless Assessing Officer, and issuance by a Jurisdictional Assessing Officer constitutes a fatal defect. The Tribunal explicitly stated they were bound to follow the Hexaware Technologies Ltd. judgment. The operative direction was to set aside the impugned Notice and all consequential proceedings. Liberty was granted to the Revenue to revive the writ petition if the Supreme Court sets aside the Hexaware Technologies Ltd. decision. The Tribunal noted that if the SLP is dismissed by the Supreme Court, there would be no question of revival. The Court also clarified that upon revival, the petition would be decided on its merits, considering other issues raised.

What were the facts?

The petitioner, Jayant Vaman Padsalgikar, filed a writ petition challenging a notice issued under Section 148 of the Income Tax Act, 1961. The petitioner argued that the notice was invalid because it was issued by a Jurisdictional Assessing Officer, whereas the law mandates issuance by a Faceless Assessing Officer. The High Court of Bombay issued a rule and granted interim relief staying the Section 148 notice. The matter was heard finally with the consent of both parties. The Revenue acknowledged that the issue was covered by a Division Bench decision of the same court but stated that this decision was under challenge 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 due to being issued by a Jurisdictional Assessing Officer instead of a Faceless Assessing Officer, as mandated by law? (Question of law) Assessee's Contention: The Petitioner contended that the issuance of the Section 148 notice by the Jurisdictional Assessing Officer, when the law requires it to be issued by the Faceless Assessing Officer, is a fatal defect rendering the notice liable to be quashed. The Petitioner relied on the Division Bench decision of the Bombay High Court in Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2) [(2024) 162 taxmann.com 225 (Bombay)]. Revenue's Contention: The Revenue conceded that the issue was concluded by the Hexaware Technologies Ltd. decision. However, they informed the court that this decision had been challenged before the Hon'ble Supreme Court and was likely to be taken up immediately upon reopening. The Revenue fairly stated that there was no stay granted against the Hexaware Technologies Ltd. judgment.

Which sections of the Income-tax Act were involved?

Section 148

AI-generated summary — verify with the full judgment below

34.wp.6439.2025.doc

IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.6439 OF 2025 Jayant Vaman Padsalgikar .. Petitioner Versus Income Tax Officer, Ward-2(3), Solapur & Ors. .. Respondents Ms.Rutuja N. Pawar (through V.C.) a/w Hetal Laghave, Sneha More, Advocates for the Petitioner. Mr.Akhileshwar Sharma, Advocate for the Respondents.

CORAM : B. P. COLABAWALLA & FIRDOSH P. POONIWALLA, JJ. DATE : JULY 23, 2025 P. C. 1. In the above Petition Rule was issued on 17th June 2025 and interim relief was also granted interalia staying the Notice issued under Section 148 of the Income Tax Act, 1961. Today, though the matter has come up under the caption “for directions”, we have, with the consent of parties, heard it finally. Page 1 of 4 JULY 23, 2025 Utkarsh UTKARSH KAKASAHEB BHALERAO Digitally signed by UTKARSH KAKASAHEB BHALERAO Date: 2025.07.28 18:52:45 +0530

34.wp.6439.2025.doc

2.

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 Jurisdictional 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. 3. 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)]. 4. 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). Page 2 of 4 JULY 23, 2025 Utkarsh

34.wp.6439.2025.doc

5.

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. 6. We accordingly set aside the impugned Notice issued under Section 148 and all other proceedings/orders emanating therefrom. 7. 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 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. 8. We also make it clear that once the Petition is revived and restored, the same would have to be decided on its own merits Page 3 of 4 JULY 23, 2025 Utkarsh

34.wp.6439.2025.doc

considering that several other issues are also raised challenging the Notice issued under Section 148. 9. 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. 10. This order will be digitally signed by the Private Secretary/ 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.] Page 4 of 4 JULY 23, 2025 Utkarsh

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