BADMA BARIBOORANAM,TUTICORIN vs. ITO, WARD-1, TUTICORIN

This appeal filed by the assessee is directed against the order dated 08.10.2025 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi for the assessment year 2015-16.

In ground No. 2.3, the assessee challenged that the reopening itself is bad in law as the same was jurisdictionally invalid, the ld. CIT(A) erred in failing to annul the reopening and the subsequent order of reassessment.

The Assessing Officer noted that the assessee made cash deposits to an extent of ₹.6,08,852/- and sold immovable property at ₹.81,73,995/-, but, however, not filed return of income for the AY 2015-16. We note that the Assessing Officer issued notice under section 148A(b) of the Income Tax Act, 1961 [“Act” in short], however, the assessee has not filed any reply. The Assessing Officer reopened the assessment and issued notice under section 148 of the Act dated 19.04.2022. Since there was no reply from the assessee, the Assessing Officer completed the assessment under section 147 r.w.s.144 r.w.s. 144B of the Act dated 23.02.2024 assessing total income of the assessee at ₹.87,24,454/-, inter alia, making various additions. The ld. CIT(A) confirmed the additions by dismissing the appeal filed by the assessee.

The ld. AR Shri P.M. Kathir, Advocate drew our attention to pages 5 & 7, 11 & 13 & 14 of the paper book and submits that the notice under section 148A(b) of the Act, order under section 148A(d) of the Act and notice under section 148 of the Act dated 19.04.2022 respectively were issued by the jurisdictional Assessing Officer. Further, he drew our attention to the assessment order dated 23.02.2024 passed under section 147 r.w.s. 144 r.w.s. 144B of the Act by the Faceless Assessing Officer. The ld. AR vehemently argued that the assessment order passed by the Faceless mechanism [Assessing Officer] is bad in law in terms of the decision of the Hon’ble High Court of Madras in the case of TVS Credit Services Ltd. v. DCIT in W.P. No. 22402 of 2024 & WMP No. 13336 of 2023 dated 24.06.2025 and prayed to quash the assessment order passed by the NFAC without issuing notice under section 148A(d) of the Act.

The ld. DR Ms. Latchana, JCIT supported the order passed the Assessing Officer.

We have heard both the parties and perused the material available on record. In this case, we note that the assessment order under section 147 r.w.s. 144 r.w.s. 144B of the Act was passed by the assessment unit of NFAC. Further, we note that the notice under section 148 of the Act was issued by the Jurisdictional Assessing Officer and also passed order under section 148A(d) of the Act. On perusal of the decision of the Hon’ble High Court of Madras in the case of TVS Credit Services Ltd. v. DCIT (supra), we note that the Hon’ble High Court was pleased to hold that the assessment made by the assessment unit of NFAC is not valid if the order and notice under section 148A(d)/148 of the Act issued by the Jurisdictional Assessing Officer, but, however, liberty was given to the Revenue to re-ignite the notice in case the Hon’ble Supreme Court interferes with the order of the Hon’ble High Court of Bombay in the case of Hexaware Technologies Ltd. V. ACIT 464 ITR 430 (Bombay). Accordingly, we hold that the assessment order dated 24.02.2024 passed by the assessment unit of NFAC is bad in law and it is quashed. Accordingly, the ground No. 2.3 raised by the assessee is allowed and remaining ground Nos. 3.1, 3.2, 4.1 & 4.2 become infructuous.

In the result, the appeal filed by the assessee is allowed. Order pronounced on 18th December, 2025 at Chennai.