PAVAN BALAN,NILGIRIS vs. ITO, WARD 1,, OOTY

We note that the Assessing Officer assessed income of the assessee at ₹.16,83,000/- against NIL income returned, inter alia, making addition under section 69A of the Act towards variation in respect of cash deposits. The ld. CIT(A) confirmed the order of the Assessing Officer.

The ld. AR Shri N. Vijayakumar, CA drew our attention to the order under section 148A(d) of the Act dated 15.04.2022 passed by the juri iction Assessing Officer placed on record. He also drew our attention to para 1.1 at page 2 of the assessment order that the notice dated 16.03.2022 issued by the juri iction Assessing Officer under section 148A(d) of the Act. 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 Mark Studio India (P.) Ltd. V. ITO in W.A. No. 781 of 2025 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.

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 Juri ictional Assessing Officer in pursuance of 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 Mark Studio India (P.) Ltd. V. ITO (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 Juri ictional 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 29.02.2024 passed by the assessment unit of NFAC is bad in law and it is quashed. Accordingly, the grounds raised by the assessee on assumption of juri iction in I.T.A. No.2116/Chny/25 4 ground Nos. 2 to 7 are allowed and other ground Nos. 8 to 14 become academic in view of our decision in ground Nos. 2 to 7. 7. In the result, the appeal filed by the assessee is allowed. Order pronounced on 24th October, 2025 at Chennai. (M. BALAGANESH) ACCOUNTANT MEMBER Chennai, Dated, 24.10.2025