INDIAN MEDICAL ASSOCIATION COLLEGE OF GENERAL PRACTITIONERS HEAD QUTS TRUST,CHENNAI vs. ITO, NCW22(1), CHENNAI

We have heard both the parties and perused the material available on record. The assessee is an individual, whose case was reopened by the Jurisdictional Assessing Officer (hereinafter referred to as ‘JAO‘) u/s.147 & 2187/Chny/2025 (AY 2019-20) Indian Medical Association College – of General Practitioners Head Quts Trust of the Act on the basis of information that during the relevant AY 2019- 20, the assessee’s income had escaped assessment for the reason stated therein, the assessment was reopened by the AO by issuance of notice u/s.148 of the Act dated 09.03.2023 and later, culminated in AO passing assessment order on 29.12.2023. Aggrieved, the assessee filed appeal before Ld CIT(A), who dismissed it by not admitting the appeal by not condoning the delay.

Aggrieved, the assessee is before us and has raised the legal issue impugning the notice issued by the JAO dated 09.03.2023 passed u/s.148 of the Act as bad in law on the strength of Hon’ble Jurisdictional High Court and other judicial precedents cited supra; and in this regard it is noted that the impugned notice u/s 148 dated 09.03.2023 was issued by JAO/M.P. Srinivasan non corp ward 22 (1) TBM And thereafter, the Assessment Unit Income Tax Department, is noted to have framed the re- assessment order on 29.12.2023 after making certain additions.

The assessee’s contention is that jurisdictional notice issued by the JAO u/s 148 after 09.03.2023 in order to reopen the assessment is bad in law since he didn’t adhere to the provisions of Section 151 of the Act and the scheme notified by the CBDT [Faceless Scheme notified from 29.03.2022 (supra)] which legal issue, which we will deal first.

We note that on this legal issue there are divergent views expressed by different Hon’ble High Courts. However, it is noted that on this issue the Hon’ble jurisdictional High Court i.e. Madras High Court (Division Bench) in Mark Studio India (P.) Ltd. (supra) has expressed their view in favour of the assessee, by concurring with the Hon’ble Bombay High Court in the case of Hexaware Technologies (supra). And further it is noted that similar view in favour of assessee has been taken by Hon’ble Gujarat High Court, the Hon’ble Telangana High Court and the Hon’ble Punjab & Haryana High Court as cited by Ld AR (supra). Even though, the Ld.DR has brought to our notice that on the legal issue, the Hon’ble Delhi High Court & Hon’ble Calcutta High Court and Hon’ble Single Bench of Madras High Court in Mark Studio India (P.) supra has held in favour of the Revenue; but since the Hon’ble jurisdictional High Court (Division Bench) in Mark Studio India (P.) (supra) has reversed the Hon’ble Single Bench and has taken view in favour of assessee as held in Hexaware Technologies Ltd. (Bom), according to us, the legal issue raised by the assessee is no longer res-integra and we are bound to follow the decision in favour of the assessee on the legal issue raised before us.

The Hon’ble Bombay High Court in the case of Hexaware Technologies Ltd., (supra) is noted to have even dealt with the decision rendered by the Hon’ble Calcutta High Court in favour of the Revenue, but & 2187/Chny/2025 (AY 2019-20) Indian Medical Association College – of General Practitioners Head Quts Trust concurred with the view of the Hon’ble Telangana High Court in the case of Sri Venkataramana Reddy Patloola v. DCIT reported in [2023] 156 taxmann.com 178 (Telangana) and held that in view of the provisions of Sec.151A of the Act read with Faceless Scheme dated 29.03.2022, notices issued by the JAO u/s.148A(d)/148 of the Act was invalid and bad in law.

In the light of the aforesaid discussion, we find that in the case in hand, the JAO had issued notice u/s.148 dated 09.03.2023 which impugned notices have been issued despite faceless scheme was notified by Central Government on 29.03.2022 pursuant to section 151A of the Act, making it mandatory for the issuance of notice u/s.148A(b), 148A(d) as well as 148 of the Act by the Faceless Mechanism, the impugned notices especially issued u/s.148 dated 29.03.2023 is found to be invalid and bad in law, since it has been issued contrary to law and is against the ‘Rule of Law’; which impugned action of the JAO vitiates the reopening of assessment for AY 2019-20 & consequent action of framing assessment order dated 29.12.2023 is held to be null in eyes of law; and the assessee succeeds, on the legal issue which is held in favour of the assessee and therefore, we are inclined not to go into the merits of the addition made by the NFAC.

The AO is noted to have levied a penalty of Rs.10,000/- u/s.272A(1)(d) of the Act for not complying with the notice issued u/s.142(1) dated 27.07.2023. On appeal, the Ld.CIT(A) has refused to & 2187/Chny/2025 (AY 2019-20) Indian Medical Association College – of General Practitioners Head Quts Trust condone the delay and didn’t admit the appeal. Aggrieved, the assessee is before us.

Since, the notice u/s.142(1) dated 28.07.2023 was issued pursuant to the reopening u/s.148 by the JAO dated 09.03.2023 which we have already quashed. As a sequitur the notice u/s.142(1) dated 27.08.2023 is null in the eyes of law and therefore, it is also quashed.

In the result, appeals filed by the assessee are allowed.