Rajasthan High Court Judgments — 2025

The High Court noted that the issue raised by the petitioner had been adjudicated by a co-ordinate bench in D.B. Civil Writ Petition No.11787/2024 (Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr.) and other connected petitions decided on March 19, 2025. This earlier judgment held that notices issued under Section 148 of the Act by the JAO were not in line with the broader scheme of law requiring automated allocation based on algorithms. It was held that the mandate of Section 151A of the Act must be strictly followed, and JAOs do not have the jurisdiction to issue such notices, as it weakens Section 151A. Consequently, impugned notices were quashed and set aside, with liberty to issue fresh notices in compliance with CBDT Notification dated March 29, 2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer. The time spent during litigation was to be excluded for computing limitation for fresh notices. In the present case, the Court observed that the final order was passed after the notice was issued by the JAO. Since an appeal against the final order was pending, the Court deemed it inappropriate to pass orders that would render the appeal redundant. Therefore, the petitioner was directed to file an application before the concerned Commissioner of Income Tax (Appeal), who was directed to pass appropriate orders within 15 days, taking into consideration the previous judgments quashing proceedings based on notices issued by the JAO.

The High Court noted that the petitioner had already filed an appeal before the Commissioner of Income Tax (Appeals) against the final assessment order, which was pending. While acknowledging the judgments in Sharda Devi Chhajer and Jasjit Singh, which held that notices issued by the JAO under Section 148 are contrary to the Act and the faceless regime, the Court found it inappropriate to pass orders that would render the pending appeal redundant. Therefore, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals). The Commissioner was instructed to consider this application and pass appropriate orders within 15 days, taking into account the Court's previous judgments quashing proceedings based on notices issued by the JAO. The writ petition was disposed of with this direction.

The Tribunal noted that upon instructions, the learned counsel for the petitioner prayed to withdraw the present civil writ petition. Consequently, the Tribunal dismissed the Civil Writ Petition as withdrawn. All pending applications in the matter were also disposed of as a result of the withdrawal. No decision was made on the merits of the case, and no specific legal principles were established or applied. The operative direction was to dismiss the petition as withdrawn.

The High Court noted that a coordinate bench had previously adjudicated similar issues in D.B. Civil Writ Petition No.11787/2024: Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr., and other connected writ petitions decided on 19.03.2025. This prior judgment held that notices issued under Section 148 of the Act by the JAO are invalid as they do not comply with the scheme of automated allocation based on algorithms and random assignment of assessing officers, as envisaged by Section 151A of the Act and CBDT notifications. The Court also referred to another judgment in CWP No.21509/2023 (Jasjit Singh vs. Union of India & Ors.) which held that circulars or instructions cannot override statutory provisions and that notices issued by the JAO under Section 148, without conducting faceless assessment as per Section 144B, are contrary to the Act. In the present case, the final order was passed after the notice was issued by the JAO. However, since an appeal was already preferred against the final order, the Court deemed it inappropriate to pass orders that would render the appeal redundant. Therefore, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeal), who was directed to consider the application and pass appropriate orders within 15 days, taking into account the prior judgments quashing proceedings based on notices issued by the JAO.

The Tribunal was not justified in holding that Section 80-IA(9) of the Income-tax Act, 1961 mandates the reduction of profits allowed as deduction under Section 80-IA(1) from the profits of the business of the undertaking while computing deductions under other provisions of Heading C in Chapter VI-A. The High Court, following the decision in Associated Capsules P. Ltd. v. Deputy Commissioner of Income-tax & Anr., held that Section 80-IA(9) does not affect the computability of deductions under various provisions under Heading C of Chapter VI-A, but rather affects their allowability. The purpose of Section 80-IA(9) is to prevent taxpayers from claiming repeated deductions on the same income and to ensure that the aggregate deduction under Section 80-IA and other provisions under Heading C of Chapter VI-A does not exceed 100% of the profits of the business. The appeals were allowed in favour of the assessee.

The Tribunal held that the notice dated June 24, 2025, issued under Section 148 of the Act, along with consequential proceedings, is liable to be quashed and set aside. The Court found the facts of the Gujarat High Court case (Talati and Talati LLP) to be entirely different from the present case. The Gujarat High Court's decision was based on a reading of Explanation 2 to Section 148 and an understanding that the pre-requisites for issuing a notice under Section 148 in search cases could not be met by the FAO. The Tribunal disagreed with this reasoning. The Court noted that the Gujarat High Court was not made aware of the Bombay High Court's reasoning in Abhin Anilkumar Shah, which distinguished between assessment proceedings and the applicability of faceless schemes. The Tribunal also referred to the Telangana High Court's decision in Venkataramana Reddy Patloola. Consequently, the notice and proceedings were quashed, with liberty granted to the revenue to revive the notice if the Apex Court interferes with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. The petitioner did not press other grounds.

The Tribunal quashed and set aside the notice dated March 29, 2025, issued under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings. The Court found that the Gujarat High Court's judgment in Talati and Talati LLP was based on a reading of Explanation 2 to Section 148 and an understanding that the pre-requisites for issuing a Section 148 notice in search cases could not be met by a Faceless Assessing Officer (FAO). The Rajasthan High Court, however, disagreed with this reasoning. The Court noted that the Gujarat High Court was not made aware of the Bombay High Court's reasoning in Abhin Anilkumar Shah, which clarified that CBDT orders creating exceptions to the faceless mechanism did not apply to the scheme notified on March 29, 2022. The Tribunal relied on the judgments of the Bombay High Court in Hexaware Technologies Ltd. and Abhin Anilkumar Shah, and the Telangana High Court in Venkataramana Reddy Patloola. The Revenue was granted liberty to revive the notice if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. Other grounds raised by the petitioner were not pressed.

The Court noted that the issue raised had been finally adjudicated by a coordinate bench in D.B. Civil Writ Petition No.11787/2024: Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr. and other connected writ petitions. The coordinate bench held that notices issued under Section 148 of the Act by the JAO were not sustainable as they did not adhere to the algorithm-based random assignment system mandated by Section 151A of the Act. The Court observed that while the faceless regime was introduced, the final order was passed after a notice was issued by the JAO. However, since an appeal was already preferred against the final order, it would not be appropriate for the High Court to pass orders that would make the appeal redundant. Therefore, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals), who would consider the matter and pass appropriate orders within 15 days, taking into account the prior judgments quashing proceedings based on notices issued by the JAO. The Civil Writ Petition was disposed of accordingly.

The Tribunal was not justified in holding that Section 80-IA(9) of the Income-tax Act, 1961 mandates the reduction of profits allowed as deduction under Section 80-IA(1) from the profits of the business while computing deductions under other provisions of Chapter VI-A. The High Court, following the decision in Associated Capsules P. Ltd. v. Deputy Commissioner of Income-tax & Anr., held that Section 80-IA(9) affects the allowability of deductions, not their computation. The purpose of Section 80-IA(9) is to prevent claiming repeated deductions or deductions exceeding eligible profits, ensuring the aggregate deduction under Section 80-IA and other provisions under Heading C of Chapter VI-A does not exceed 100% of the business profits. The appeals were allowed in the same terms as the cited judgment, with no order as to costs.

The High Court held that as long as the law declared in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra) – that jurisdiction vests with the Faceless Assessing Officer – remains in effect, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO), strictly in accordance with law, subject to limitations and legal requirements. The petitioner stated that other grounds were not being pressed and would be taken up later if required, and undertook to withdraw a previously filed appeal. The writ petition was disposed of accordingly.

The Court acknowledged that notices issued by the JAO under Section 148 of the Income Tax Act, 1961, and subsequent proceedings initiated without conducting faceless assessment, as envisaged under Section 144B, are contrary to the provisions of the Act. This aligns with previous judgments by coordinate benches in Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr. and Jasjit Singh vs. Union of India & Ors. The Court noted that the final assessment order was passed after the notice was issued by the JAO, and an appeal against this order was already pending. To avoid making the pending appeal redundant, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals). The CIT(A) is to take into consideration the previous judgments quashing proceedings based on notices issued by the JAO and pass appropriate orders within 15 days.

The High Court acknowledged that the notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, were contrary to the provisions of the Act and the faceless assessment regime, as held in previous judgments like *Sharda Devi Chhajer* and *Jasjit Singh*. These precedents established that JAOs lack the jurisdiction to issue such notices, and adherence to the algorithm-based random assessing system mandated by Section 151A is crucial. However, since a final assessment order had been passed and an appeal was already pending before the Commissioner of Income Tax (Appeals), the Court deemed it inappropriate to pass an order that would render the pending appeal redundant. Therefore, the Court directed the petitioner to file an application before the Commissioner of Income Tax (Appeals). The Commissioner was instructed to consider this application and pass appropriate orders within 15 days, taking into account the Court's prior judgments quashing proceedings based on notices issued by JAOs. The writ petition was disposed of with this direction.

The High Court noted that the final assessment order was passed after the notice was issued by the Jurisdictional Assessing Officer, even though the faceless regime had been introduced. Citing previous judgments in 'Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr.' and 'Jasjit Singh vs. Union of India & Ors.', the Court reiterated that proceedings could not have been initiated by the JAO, and the faceless regime could not have later passed orders if the initial step was flawed. However, since an appeal against the final order was already preferred and pending before the Commissioner of Income Tax (Appeals), the Court deemed it inappropriate to pass orders that would render the appeal redundant. Consequently, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals), who was directed to consider the application and pass appropriate orders within 15 days, taking into account the Court's prior judgments quashing proceedings based on notices issued by the JAO. The writ petition was disposed of with these directions.

The Tribunal quashed and set aside the notice dated March 26, 2025, issued under Section 148 of the Income Tax Act, 1961. The Court found that the Gujarat High Court's judgment in Talati and Talati LLP was based on a different understanding of the notification dated March 29, 2022, and Explanation 2 to Section 148, specifically regarding search and seizure cases, and did not consider the reasoning of the Bombay High Court in Hexaware Technologies Ltd. or the CBDT orders dated March 31, 2021, and September 6, 2021. The Court also noted that the Supreme Court had dismissed an SLP against a Telangana High Court order based on the Hexaware Technologies Ltd. judgment. The Court held that the notice issued by the JAO was liable to be quashed. The Revenue was granted liberty to revive the notice if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. The petitioner did not press other grounds.

The High Court held that as long as the law declared in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra) continues to hold that jurisdiction vests with the Faceless Assessing Officer (FAO), notices issued by the Jurisdictional Assessing Officer (JAO) are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, and all consequential proceedings were quashed and set aside for being without jurisdiction. The Court clarified that liberty was reserved in favour of the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was granted to the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not pressed and would be taken up at an appropriate stage, undertaking to withdraw an already filed appeal.

The High Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd., which establishes that jurisdiction vests with the Faceless Assessing Officer, continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated March 19, 2025, issued under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, was quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer strictly in accordance with law, subject to limitations and legal requirements. Furthermore, the Revenue is at liberty to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court. The petitioner stated that other grounds were not being pressed and undertook to withdraw a previously filed appeal.

The Tribunal quashed and set aside the notice dated March 26, 2025, issued under Section 148 of the Income Tax Act, 1961. The Court found that the facts of the Gujarat High Court case (Talati and Talati LLP) were entirely different from the present case and that the Gujarat High Court's reasoning was not based on a comprehensive understanding of the relevant notifications and prior judicial pronouncements. The Court noted that the Bombay High Court in Hexaware Technologies Ltd. and the Telangana High Court in Venkataramana Reddy Patloola had taken a different view, which was further supported by the Supreme Court's dismissal of an SLP against the Telangana High Court's order. The Court held that the faceless regime, as framed under Section 151A and notified on March 29, 2022, does not include exceptions for orders dated March 31, 2021, and September 6, 2021, in the manner suggested by the revenue. The Court explicitly disagreed with the Gujarat High Court's understanding that pre-requisite conditions for issuing a notice under Section 148 in search cases cannot be met by the FAO. The revenue was granted liberty to revive the notice if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited.

The Tribunal quashed and set aside the notice dated March 26, 2025, issued under Section 148 of the Income Tax Act, 1961. The reasoning was that the Gujarat High Court's judgment in Talati and Talati LLP was factually different and did not consider the combined effect of the notification dated March 29, 2022, and earlier CBDT orders dated March 31, 2021, and September 6, 2021. The Tribunal found that these orders carved out exceptions for assessment proceedings in Central Charges and International Taxation Charges, and the scheme did not expressly include or refer to them. The Tribunal also noted the Supreme Court's dismissal of an SLP against a Telangana High Court order that was based on similar reasoning, indicating no interference with the impugned order. The revenue was granted liberty to revive the notice if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. Other grounds raised by the petitioner were not pressed.

The Tribunal held that the notice dated March 26, 2025, issued under Section 148 of the Income Tax Act, 1961, was liable to be quashed and set aside. The Court found that the facts of the Gujarat High Court case in Talati and Talati LLP were entirely different from the present case. The Court disagreed with the reasoning that the pre-requisites for issuing a notice under Section 148 in search cases could not be met by the FAO. The Tribunal noted that the Bombay High Court in Hexaware Technologies Ltd. distinguished its earlier ruling as applicable to Explanation 1 to Section 148, not cases where Explanation 2 would be attracted. Furthermore, the Bombay High Court relied on the Telangana High Court's decision in Venkataramana Reddy Patloola, against which the Revenue's SLP was dismissed by the Supreme Court. The Court quashed the notice with liberty to the parties to revive it if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. The petition was disposed of on the same terms as a previous co-ordinate bench judgment.

The High Court held that as long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. (holding that jurisdiction vests with the Faceless Assessing Officer) continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, was quashed and set aside for being without jurisdiction. The Court clarified that liberty was reserved in favour of the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) in accordance with law, subject to limitations and legal requirements. Furthermore, the Court stipulated that if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court, the Revenue would be at liberty to act accordingly. The petitioner's counsel stated that other grounds were not being pressed and would be taken up at an appropriate stage, and undertook to withdraw the appeal filed.

The High Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd., which established that jurisdiction vests with the Faceless Assessing Officer (FAO), continues to hold the field, notices issued by the Jurisdictional Assessing Officer (JAO) are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that the respondent-Revenue is at liberty to proceed afresh through the Faceless Assessing Officer (FAO) in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was reserved for the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage.

The High Court held that as long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. (which states that jurisdiction vests with the Faceless Assessing Officer) continues to be valid, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, and all consequential proceedings were quashed and set aside for being without jurisdiction. The Court clarified that the respondent-Revenue is at liberty to proceed afresh through the Faceless Assessing Officer (FAO), strictly in accordance with law, subject to limitations and other legal requirements. Furthermore, the Court reserved liberty for the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage.

The Court acknowledged that the issue raised concerned the issuance of a notice by the JAO. However, since a final order had already been passed and an appeal was pending before the Appellate Authority, the Court found it inappropriate to pass orders that would render the appeal redundant. Citing its own previous decision in Samir Andrea Kasliwal vs. Principal Chief Commissioner & Ors. (D.B. Civil Writ Petition No.15349/2024), which relied on judgments in Jasjit Singh and Sharda Devi Chhajer, the Court held that proceedings could not have been initiated by the JAO, nor could the faceless regime have passed orders later if the initial initiation was flawed. Nevertheless, to avoid making the pending appeal redundant, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeal). This authority was directed to consider the objections and pass appropriate orders within 15 days, following the Court's previous judgment on quashing proceedings based on a JAO's notice. The writ petition was disposed of on these directions.

The High Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. continues to hold the field, which states that jurisdiction vests with the Faceless Assessing Officer, the issuance of notices by the Jurisdictional Assessing Officer is not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) in accordance with law, subject to limitations and legal requirements. Furthermore, the Revenue was granted liberty to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court. The petitioner stated that other grounds were not being pressed and undertook to withdraw a previously filed appeal.

The Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. (which stated that jurisdiction vests with the Faceless Assessing Officer) continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148A(3) and all consequential proceedings were quashed and set aside for being without jurisdiction. The Court clarified that the respondent-Revenue is at liberty to proceed afresh through the Faceless Assessing Officer (FAO) strictly in accordance with law and the prevailing statutory framework, subject to limitations and other legal requirements. Liberty was also reserved for the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage.

The Court held that as long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. (which held that jurisdiction vests with the Faceless Assessing Officer) continues to be in force, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notices dated 24.03.2024 under Section 148A(3) and 11.03.2025 under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that the respondent-Revenue is at liberty to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was reserved for the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court. The petitioner stated that other grounds were not being pressed and undertook to withdraw the appeal filed.

The High Court held that as long as the law declared in Sharda Devi Chhajer and Hexaware Technologies, which states that jurisdiction vests with the Faceless Assessing Officer, continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148A(3) of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) strictly in accordance with law and the prevailing statutory framework, subject to limitation and other legal requirements. The Court further clarified that if the judgments in Hexaware Technologies, Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court, the Revenue shall be at liberty to act in accordance with law. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage, undertaking to withdraw the appeal already filed.

The Tribunal, following the judgment in M/s. Jagtamba Timber Mart (supra), quashed and set aside the notice dated March 24, 2024, issued under Section 148 of the Income Tax Act, 1961, and the assessment order dated March 21, 2025, passed under Section 147 of the Act, along with consequential proceedings. The court granted liberty to the revenue to revive the notice issued under Section 148 of the Act in case the Apex Court interfered with the judgments in Hexaware Technologies Ltd. (supra), Sharda Devi Chhajer (supra), or Shree Cement Limited (supra). The petitioner's counsel undertook to withdraw the appeal already filed. The petition was disposed of with liberty as prayed, keeping open all rights and contentions of the parties. The court noted that the petitioner was not pressing other grounds at that stage.

The High Court held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed, and there cannot be a way out of doing so. The Court further held that the Jurisdictional Assessing Officer (JAO) shall not have the jurisdiction to issue notices under Section 148 of the Act, as it would weaken Section 151A and potentially lead to its diminished activation. For assessment and reassessment under Sections 147, 148, and 148A, in light of the sanction under Section 151A, adherence to the algorithm-based random assessing system is mandatory. Consequently, the impugned notices were quashed and set aside for want of jurisdiction. The Court also held that instructions and circulars can only supplement statutory provisions and cannot override them. The time spent during the pendency of the litigation was excluded for computing the limitation for issuing fresh notices, if needed, in compliance with the CBDT Notification dated 29.03.2022, with the FAO as the assessing officer. The notice dated 02.04.2024 issued by the JAO and all consequential orders were quashed.

The Court held that as long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd., which states that jurisdiction vests with the Faceless Assessing Officer, continues to hold, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated March 19, 2025, issued under Section 148A(3) of the Income Tax Act, 1961, and all consequential proceedings were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law and the prevailing statutory framework, subject to limitations and other legal requirements. Furthermore, the Revenue is at liberty to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage, and undertook to withdraw a previously filed appeal.

The High Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. continues to hold that jurisdiction vests with the Faceless Assessing Officer, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Accordingly, the impugned notice dated 18.03.2025 issued under Section 148A(3) and all consequential proceedings were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was granted to the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage.

The High Court held that so long as the law declared in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra) continues to hold the field, which states that jurisdiction vests with the Faceless Assessing Officer, the issuance of notices by the Jurisdictional Assessing Officer is not legally sustainable. Accordingly, the impugned notice dated 24.03.2024 under Section 148A(3) and the consequential notice dated 20.03.2025 under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) strictly in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was granted to the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner's counsel stated that other grounds were not pressed and undertook to withdraw a previously filed appeal.

The Tribunal held that notices issued under Section 148 of the Income Tax Act, 1961, by the Jurisdictional Assessing Officer (JAO) are invalid. The Court reasoned that the mandate of Section 151A of the Act must be strictly followed, requiring adherence to an algorithm-based random assessing system for assessment and reassessment under Sections 147, 148, and 148A. Issuance of such notices by the JAO would weaken Section 151A and potentially lead to its diminishing activation. The Court relied on a coordinate bench's decision in Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr. and an order by one of its judges in Jasjit Singh vs. Union of India & Ors. The impugned notice dated March 17, 2025, issued by the JAO, and all consequential orders passed on its basis, were quashed and set aside for want of jurisdiction. The respondents were granted liberty to issue fresh notices in compliance with the CBDT Notification dated March 29, 2022, by keeping the FAO as the assessing officer. The time spent during the litigation was to be excluded for computing the limitation for issuing fresh notices.

The High Court acknowledged that the petitioner had raised grievances regarding the jurisdiction of the issuing officer under the faceless scheme and that a final order had been passed, with an appeal pending before the Appellate Authority. The Court had previously directed the petitioner to raise these issues before the Appellate Authority. Considering that proceedings under Section 270/274 of the Income Tax Act had been initiated and in light of a previous order by a Coordinate Bench in a similar matter, the Court deemed it appropriate to stay the impugned notices dated 01.05.2025 and 07.05.2025. The Court also directed that no coercive steps shall be taken against the petitioner until the appeal is decided. The writ petition was disposed of accordingly.

The Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd., which vests jurisdiction with the Faceless Assessing Officer, continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 15.02.2024 under Section 148A(3) and the consequential notice dated 11.03.2025 under Section 148, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the Revenue to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law and the prevailing statutory framework, subject to limitations and other legal requirements. Furthermore, the Revenue was granted liberty to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court. The petitioner stated other grounds were not pressed and would be taken up later, undertaking to withdraw the appeal filed.

The High Court quashed and set aside the notice dated March 24, 2024, issued under Section 148 of the Income Tax Act, 1961, and the assessment order dated March 21, 2025, passed under Section 147 of the Act, along with consequential proceedings. This decision was based on the agreement of the parties that the controversy was squarely covered by a prior judgment of a coordinate bench in D.B. Civil Writ Petition No.22164/2025 (M/s. Jagtamba Timber Mart Vs. The Deputy Commissioner of Income Tax), decided on November 12, 2025. The court accepted the undertaking of the petitioner's counsel to withdraw the appeal already filed. Liberty was granted to the revenue to revive the notice under Section 148 if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited. All other grounds raised by the petitioner were not pressed and were left open to be taken at an appropriate stage. The writ petition was disposed of in terms of the aforementioned order.

The Court held that as long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. (which stated that jurisdiction vests with the Faceless Assessing Officer) remains in effect, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148A(3) and all consequential proceedings were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was granted to the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage.

The Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd., which vests jurisdiction with the Faceless Assessing Officer, continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Accordingly, the impugned notice dated 18.03.2025 issued under Section 148A(3) of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved in favour of the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was granted to the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon’ble Supreme Court. The petitioner stated that other grounds were not being pressed and undertook to withdraw a previously filed appeal.

The High Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. continues to hold that jurisdiction vests with the Faceless Assessing Officer, the issuance of notices by the Jurisdictional Assessing Officer is not legally sustainable. Consequently, the impugned notice dated 24.02.2024 under Section 148A(3) and the consequential notice dated 26.03.2025 under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The court clarified that the revenue is at liberty to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was granted to the revenue to act in accordance with law if the aforementioned judgments are reversed, set aside, or materially modified by the Supreme Court. The petitioner stated that other grounds were not pressed and would be taken up at an appropriate stage.

The Court held that so long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd., which posits that jurisdiction vests with the Faceless Assessing Officer, continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 19.03.2025 issued under Section 148A(3) of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) in accordance with law, subject to limitations and legal requirements. Furthermore, the Revenue is at liberty to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds are not being pressed and undertook to withdraw the appeal already filed.

The Tribunal, following the judgment of a coordinate Bench in M/s. Jagtamba Timber Mart (supra), quashed and set aside the notice dated March 24, 2024, issued under Section 148 of the Income Tax Act, 1961, and the assessment order dated March 21, 2025, passed under Section 147 of the Act, along with consequential proceedings. The court granted liberty to the Revenue to revive the notice under Section 148 if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd. (supra), Sharda Devi Chhajer (supra), or Shree Cement Limited (supra). The petitioner undertook to withdraw an appeal already filed within two weeks, which was accepted by the court. All other grounds raised by the petitioner were not pressed and were kept open to be taken up at an appropriate stage. The writ petition was disposed of in terms of the order passed in M/s Jagtamba Timber Mart (supra).

The High Court held that so long as the law declared in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra), which vests jurisdiction with the Faceless Assessing Officer, continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Accordingly, the impugned notice dated 10.04.2024 issued under Section 148A(3) of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved in favour of the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) strictly in accordance with law and the prevailing statutory framework, subject to limitation and other legal requirements. Furthermore, the Court granted liberty to the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage. The petitioner also undertook to withdraw the appeal already filed.

The High Court held that as long as the law declared in Sharda Devi Chhajer and Hexaware Technologies Ltd. (holding that jurisdiction vests with the Faceless Assessing Officer) continues to hold the field, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated March 19, 2025, issued under Section 148A(3) of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty was reserved in favour of the respondent-Revenue to proceed afresh through the Faceless Assessing Officer (FAO) strictly in accordance with law, subject to limitations and legal requirements. Furthermore, the Revenue was granted liberty to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited were reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not being pressed and would be taken up at an appropriate stage.

The High Court allowed the writ petition, quashing the notice dated 24.03.2024 issued by the Jurisdictional Assessing Officer (J.A.O.) and all consequential orders. The court held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed, and the JAO does not have the jurisdiction to issue notices under Section 148 of the Act. This would weaken Section 151A and diminish its activation. For assessment and reassessment under Sections 147, 148, and 148A, adherence to an algorithm-based random assessing system is required. The court found that notices issued by the JAO under Section 148, without conducting faceless assessment as envisaged under Section 144B, are contrary to the Act. The court also held that circulars or instructions by the Board cannot override statutory provisions or make them otiose. The court granted liberty to the respondents to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, keeping the FAO as the assessing officer. The time spent during the litigation was excluded for computing the limitation for issuing fresh notices.

The Rajasthan High Court held that so long as the law declared in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra) continues to hold that jurisdiction vests with the Faceless Assessing Officer, the issuance of notices by the Jurisdictional Assessing Officer would not be legally sustainable. Accordingly, the impugned notice dated 18.03.2025 issued under Section 148A(3) of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty was reserved in favour of the respondent-Revenue to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law and the prevailing statutory framework, subject to limitation and other legal requirements. Furthermore, liberty was granted to the respondent-Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon’ble Supreme Court. The petitioner stated that other grounds were not being pressed and undertook to withdraw the appeal already filed.

The High Court held that so long as the law declared in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra) – that jurisdiction vests with the Faceless Assessing Officer – continues to hold, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 01.03.2024 under Section 148A(3) and the consequential notice dated 09.03.2025 under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that the Revenue is at liberty to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law, subject to limitations and legal requirements. Furthermore, liberty was granted to the Revenue to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Supreme Court. The petitioner's counsel stated that other grounds were not pressed and undertook to withdraw a previously filed appeal.

The Tribunal, following the decision in M/s. Jagtamba Timber Mart Vs. The Deputy Commissioner of Income Tax (supra), quashed and set aside the notice dated March 24, 2024, issued under Section 148 of the Income Tax Act, 1961, and the assessment order dated March 21, 2025, passed under Section 147 of the Act, along with consequential proceedings. The Court accepted the undertaking of the petitioner to apply to withdraw any appeal already filed within two weeks. Liberty was granted to the Revenue to revive the notice under Section 148 of the Act if the Apex Court were to interfere with the judgments in Hexaware Technologies Ltd. (supra), Sharda Devi Chhajer (supra), or Shree Cement Limited (supra). All rights and contentions of the parties were kept open. The writ petition was disposed of in terms of the order passed in the Jagtamba Timber Mart case.

The Tribunal, following the judgment of a coordinate bench in D.B. Civil Writ Petition No.22164/2025 (M/s. Jagtamba Timber Mart Vs. The Deputy Commissioner of Income Tax), decided on 12.11.2025, quashed and set aside the notice dated 24th March 2024 issued under Section 148 of the Income Tax Act, 1961, and the assessment order dated 21st March 2025 passed under Section 147 of the Act, along with consequential proceedings. The court granted liberty to the Revenue to revive the notice if the Apex Court interfered with the judgments in Hexaware Technologies Ltd. (supra), Sharda Devi Chhajer (supra), or Shree Cement Limited (supra). The petitioner undertook to withdraw an already filed appeal. The writ petition was disposed of in terms of the aforementioned order, keeping open all rights and contentions of the parties. No specific issue was left undecided.

The Court held that as long as the law declared in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra) continues to hold that jurisdiction vests with the Faceless Assessing Officer, notices issued by the Jurisdictional Assessing Officer are not legally sustainable. Consequently, the impugned notice dated 24.03.2024 under Section 148A(3) and the consequential notice dated 06.03.2025 under Section 148 of the Income Tax Act, 1961, along with all consequential proceedings, were quashed and set aside for being without jurisdiction. The Court clarified that liberty is reserved for the respondent-Revenue to proceed afresh through the Faceless Assessing Officer, strictly in accordance with law, subject to limitations and legal requirements. Furthermore, the Revenue is at liberty to act in accordance with law if the judgments in Hexaware Technologies Ltd., Sharda Devi Chhajer, or Shree Cement Limited are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not pressed and undertook to withdraw a previously filed appeal.

The Tribunal held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed, and there cannot be a way to circumvent it. It was further held that the Jurisdictional Assessing Officer (JAO) does not have the jurisdiction to issue notices under Section 148 of the Act, as doing so weakens Section 151A and may lead to its diminishing activation. For assessment and reassessment under Sections 147, 148, and 148A, in light of the sanction under Section 151A, adherence to the algorithm-based random assessing system is mandatory. Consequently, the impugned notices deserve to be quashed. The Court quashed the notice dated 24.06.2025 issued by the JAO and all consequential orders. The respondents were granted liberty to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, keeping the FAO as the assessing officer. The time spent during the litigation was excluded for computing the limitation for fresh notices.