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446 orders · Page 8 of 9
The Tribunal held that notices issued by the Jurisdictional Assessing Officer, instead of the Faceless Assessing Officer, are without jurisdiction. This finding is based on the respectful agreement with the Division Bench of the Rajasthan High Court in Sharda Devi Chhajer and the Bombay High Court in Hexaware Technologies Ltd., which established that jurisdiction vests exclusively with the Faceless Assessing Officer. Consequently, as long as these judgments remain in effect, notices issued by the Jurisdictional Assessing Officer are legally unsustainable. The impugned notice dated 27.08.2024 under Section 148 for AY 2021-2022, along with all consequential proceedings, was quashed for lack of jurisdiction. Liberty was granted to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to legal requirements. The Revenue was also granted liberty to act afresh if the Supreme Court reverses or materially modifies the judgments in Hexaware Technologies Ltd. and Sharda Devi Chhajer. Other grounds raised by the petitioner were not pressed and kept open.
The Tribunal held that jurisdiction vests exclusively with the Faceless Assessing Officer. Accordingly, notices issued by the Jurisdictional Assessing Officer are legally unsustainable as long as the judgments in Sharda Devi Chhajer and Hexaware Technologies Ltd. continue to hold the field. The impugned notice dated 30.08.2024 issued under Section 148 of the Income Tax Act, 1961, for A.Y. 2016-2017, along with all consequential proceedings, were quashed for lack of jurisdiction. Liberty was granted to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to compliance with limitation and other legal requirements. It was further clarified that if the Supreme Court reverses, sets aside, or materially modifies the judgments in Hexaware Technologies Ltd. and Sharda Devi Chhajer, the Revenue shall be at liberty to act afresh in accordance thereof. The petitioner stated that other grounds raised were not pressed at this stage.
The High Court held that no case for interference was made out. The Court noted that no interim order was passed in the writ petition and that consequential actions have already been taken by the revenue. The revenue's submission that the survey team acted within its mandate under Section 133-A and that the impounding of documents under Section 133-A(3)(ia) was justified was implicitly accepted. The Court dismissed the writ petition, leaving it open for the petitioners to raise all issues at the appropriate stage when orders are passed by the respondents. The ratio decidendi is that a writ petition challenging a survey and consequential actions may not be entertained when no interim relief was granted and the consequential actions have already been completed, with the assessee having the liberty to agitate issues in subsequent proceedings.
The Tribunal held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed, and there is no way to circumvent it. It was further held that the JAO does not have the jurisdiction to issue notices under Section 148 of the Act, as doing so weakens Section 151A and diminishes its 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 circulars or instructions by the Board cannot override statutory provisions or make them otiose. Legislative enactments with financial implications must be followed strictly. Instructions and circulars can only supplement statutory provisions. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuing fresh notices, if required. The impugned notice dated 27.06.2025 and consequential orders were quashed and set aside.
The High Court acknowledged that the issue of notices by the Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer, contrary to the faceless regime and Section 151A of the Income Tax Act, 1961, has been held to be invalid by coordinate benches of the same court in cases like Sharda Devi Chhajer and Jasjit Singh. These judgments held that such notices, issued without adherence to the algorithm-based random assessing system, deserve to be quashed. However, the Court noted that a final assessment order had already been passed and an appeal was pending before the Commissioner of Income Tax (Appeals). In these circumstances, the Court deemed 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), who was directed to consider the matter and pass appropriate orders within 15 days, taking into account the judgments quashing proceedings based on notices issued by the JAO.
The Court noted that the final assessment order was passed after the notice was issued by the JAO, despite the introduction of the faceless regime. Citing previous judgments in *Jasjit Singh vs. Union of India & Ors.* and *Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr.*, the Court acknowledged that proceedings initiated by the JAO and subsequent orders passed by the faceless regime in such cases would be contrary to the Act. However, as an appeal against the final assessment order was already pending before the Commissioner of Income Tax (Appeals), the Court deemed it inappropriate to pass an order that would render the appeal redundant. Consequently, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals). The Commissioner was directed 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 the JAO. The writ petition was disposed of with this direction.
The High Court, without commenting on the merits of the case, disposed of the writ petition. The court took into account that interim protection had been in favour of the petitioner since 2020 and that the appeal had remained undecided for over five years. Consequently, the court directed the first Appellate Authority to decide the pending appeal within three months from the date of receiving a certified copy of the order. The interim protection granted to the petitioner was extended to continue until the appeal was heard and finally decided. The operative direction was to expedite the appeal process and maintain the status quo regarding recovery until the appeal's disposal.
The Court noted that the issue of notices by the JAO under Section 148, instead of a Faceless Assessing Officer (FAO) as envisaged under Section 144B and mandated by Section 151A, was contrary to the provisions of the Income Tax Act, 1961. This was in line with previous judgments of coordinate benches in Sharda Devi Chhajer and Jasjit Singh. However, since the petitioner had already filed an appeal against the final assessment order 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 concerned Commissioner of Income Tax (Appeals). The Commissioner was directed to consider this application and pass appropriate orders within 15 days, taking into account the judgments of the High Court quashing proceedings based on notices issued by the JAO. The Court expressly left undecided the merits of the assessment itself, focusing on the procedural irregularity of the notice issuance.
The Court acknowledged that the issue of notices by the JAO instead of a Faceless Assessing Officer, contrary to the faceless regime and Section 151A of the Income Tax Act, 1961, has been held to be invalid by coordinate benches in previous judgments, such as Sharda Devi Chhajer and Jasjit Singh. These judgments quashed notices issued by JAOs and emphasized adherence to algorithm-based random assessment systems. However, in this specific case, an appeal against the final assessment order was already pending before the Commissioner of Income Tax (Appeals). The Court deemed it inappropriate to make the pending appeal redundant by passing an order that would quash the proceedings. Therefore, the Court directed the petitioner to file an application before the Commissioner of Income Tax (Appeals), who was instructed to consider the matter and pass appropriate orders within 15 days, taking into account the prior judgments of the High Court.
The Tribunal held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed. It was observed 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 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 noted that instructions and circulars can only supplement statutory provisions and cannot override them. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuing fresh notices, if necessary. The present writ petition was allowed in terms of the co-ordinate bench's decision, quashing the notice dated 27.06.2025 and consequential orders.
The Tribunal held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed. Notices issued under Section 148 of the Act by the JAO for assessment and reassessment are not sustainable as they do not adhere to the algorithm-based random assessing system envisaged by the faceless assessment scheme. Such notices undermine Section 151A and can lead to a diminishing activation of the faceless regime. The court affirmed that instructions and circulars can only supplement statutory provisions, not override them or make them obsolete. The JAO does not have the jurisdiction to issue notices under Section 148, as this would weaken Section 151A. Consequently, the impugned notices dated 27.06.2025, issued by the JAO for AY 2021-2022, and all consequential orders, were quashed and set aside for want of jurisdiction. The respondents are at liberty to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer. The time spent during the litigation will be excluded for computing the limitation for issuing fresh notices.
The Tribunal held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed. It was observed 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 diminishes its 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 required. Consequently, the impugned notices were quashed and set aside for want of jurisdiction. The Court also noted that the time spent during the pendency of the litigation would be excluded for computing the limitation for issuing fresh notices, if necessary. The operative direction was to quash the notice dated 27.06.2025 and all consequential orders, with liberty to the respondents to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer.
The Court noted that the issue raised by the petitioner regarding the invalidity of notices issued by the JAO in the context of the faceless regime has been adjudicated by a coordinate bench in D.B. Civil Writ Petition No. 11787/2024 (Sharda Devi Chhajer) and CWP No. 21509/2023 (Jasjit Singh). These judgments held that notices issued by the JAO under Section 148, without adherence to the algorithm-based random assessing system as envisaged under Section 151A and the faceless regime, are contrary to the provisions of the Act and liable to be quashed. However, since a final assessment order had already been passed and an appeal was pending before the Commissioner of Income Tax (Appeals), the Court deemed it inappropriate to pass an order that would render the appeal redundant. Therefore, the Court directed the petitioner to file an application before the Commissioner of Income Tax (Appeals), who was directed to consider the matter and pass appropriate orders within 15 days, taking into account the previous judgments of the High Court quashing proceedings based on notices issued by the JAO.
The High Court observed that the final assessment order was passed after the notice was issued by the JAO, even though the faceless regime had been introduced. While acknowledging that proceedings initiated by the JAO and subsequent orders passed under the faceless regime would be contrary to the law laid down in the cited judgments (Jasjit Singh and Sharda Devi Chhajer), the Court found it inappropriate to pass orders that would render the pending appeal before the Commissioner of Income Tax (Appeals) redundant. Therefore, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals). The Commissioner was directed to consider the application and pass appropriate orders within 15 days, taking into account the previous judgments of the High Court quashing proceedings based on notices issued by the JAO. The writ petition was disposed of with this direction.
The High Court noted that the issue of notices by the JAO under Section 148, contrary to the faceless regime envisaged under Section 144B and the mandate of Section 151A, has been held to be invalid by coordinate benches of the same court in D.B. Civil Writ Petition No.11787/2024 (Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr.) and other connected petitions, as well as in the case of Jasjit Singh vs. Union of India & Ors. The court acknowledged that the final assessment order was passed after the notice was issued by the JAO, and an appeal was already pending before the CIT(A). 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) was directed to consider this application and pass appropriate orders within 15 days, taking into account the previous judgments of the High Court quashing proceedings based on notices issued by the JAO. The writ petition was disposed of with this direction.
The High Court noted that the petitioner's argument regarding the invalidity of notices issued by the Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer, in light of Section 151A and the faceless regime, is supported by previous judgments of coordinate benches, specifically Sharda Devi Chhajer and Jasjit Singh. These judgments held that such notices are contrary to the provisions of the Act and liable to be quashed for want of jurisdiction. However, the Court observed that an appeal against the final assessment order is already pending before the Commissioner of Income Tax (Appeals). In light of this, the Court deemed 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 is directed to consider this application and pass appropriate orders within 15 days, taking into account the previous judgments of the High Court quashing proceedings based on notices issued by the JAO. The writ petition is disposed of with these directions.
The Tribunal held that notices issued under Section 148 of the Income Tax Act, 1961, by the Jurisdictional Assessing Officer (JAO) for assessment and reassessment are invalid. The Court reasoned that the mandate of Section 151A of the Act, along with the scheme for automated allocation based on algorithms and random assignment of assessing officers, must be strictly followed. Issuance of such notices by the JAO undermines the legislative intent behind faceless assessment, which aims to enhance transparency and impartiality. The JAO does not have the jurisdiction to issue notices under Section 148, as this would weaken Section 151A and diminish its activation. The Court quashed the impugned notice dated March 21, 2023, issued by the JAO for Assessment Year 2016-2017, and all consequential orders. The respondents were granted liberty to issue fresh notices in compliance with the CBDT Notification dated March 29, 2022, by keeping the Facilitation Centre or the appropriate authority as the assessing officer. The time spent during the litigation was excluded for computing the limitation for fresh notices. The ratio is that adherence to the algorithm-based random assessing system is mandatory for assessment and reassessment under Sections 147, 148, and 148A, in light of the sanction under Section 151A.
The Rajasthan High Court, Jaipur Bench, noted that the issue raised in the writ petition 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., decided on 19.03.2025. The Court reiterated the principle that the mandate of Section 151A of the Act, 1961, must be strictly followed, requiring adherence to an algorithm-based random assessing system for assessment and reassessment under Sections 147, 148, and 148A. Consequently, notices issued by the JAO for such purposes were held to be without jurisdiction and liable to be quashed. The Court also referred to its own prior decision in CWP No.21509/2023 (Jasjit Singh vs. Union of India & Ors.) which held that circulars or instructions cannot override statutory provisions and that authorities cannot usurp legal provisions for convenience. However, in the present case, since a final assessment order had been passed and an appeal was already preferred before the Commissioner of Income Tax (Appeals), the Court deemed it inappropriate to pass orders that would render the appeal redundant. Instead, the petitioner was directed to file an application before the concerned Commissioner of Income Tax (Appeals), who was directed to consider it and pass appropriate orders within 15 days, taking into account the judgments quashing proceedings based on notices issued by the JAO.
The Tribunal held that notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, for assessment and reassessment, are liable to be quashed if they do not adhere to the algorithm-based random assessing system mandated by Section 151A of the Act and the faceless assessment scheme. The court emphasized that the mandate of Section 151A must be strictly followed, and JAOs do not have the jurisdiction to issue such notices as it weakens Section 151A. The reasoning is that the legislative intent behind infusing technology for transparency and efficiency through randomized allocations must be upheld. Any attempt to circumvent this technological mandate by clinging to old methods or local control undermines legislative wisdom. Consequently, the impugned notice dated 27.06.2025 issued by the JAO for AY 2019-2020 and all consequential orders were quashed and set aside. 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 to be excluded for limitation purposes for issuing fresh notices.
The High Court held that the Income Tax Appellate Tribunal rightly granted exemption under Section 11 of the Act, as the assessee's activities were charitable. The consequential exemptions were also required to be granted, following the Supreme Court's decision in Ahmedabad Urban Development Authority.
The High Court held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed, and there can be no way around it. The Court further held that the JAO does not have the jurisdiction to issue notices under Section 148 of the Act, as this would weaken Section 151A and potentially diminish its 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, notices issued by the JAO under Section 148, and proceedings initiated thereafter without conducting faceless assessment as envisaged under Section 144B, were found to be contrary to the provisions of the Act. The impugned notice dated 30.03.2025 and all consequential orders were quashed and set aside for want of jurisdiction. The Court allowed the revenue to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuing fresh notices, if needed.
The High Court held that the Income Tax Appellate Tribunal rightly granted exemption under Section 11 of the Act, as the assessee's activities were charitable. The consequential exemptions were also required to be granted, following the Supreme Court's decision in Ahmedabad Urban Development Authority.
The High Court decided the appeals afresh, following its earlier judgment in a similar case. It held that the Income Tax Appellate Tribunal had rightly granted exemption under Section 11 of the Act, as the assessee's activities were charitable.
The High Court noted that the issue raised by the petitioner regarding the invalidity of notices issued by a JAO under Section 148, in contravention of the faceless assessment regime and Section 151A, had been 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 petitions. The coordinate bench had held that notices issued by JAOs for assessment and reassessment under Sections 147, 148, and 148A, without adherence to the algorithm-based random assessing system as envisaged by Section 151A, were liable to be quashed. The Court also referred to an order passed by one of its judges in CWP No.21509/2023 (Jasjit Singh vs. Union of India & Ors.) which reiterated that notices issued by JAO under Section 148 and subsequent proceedings initiated without conducting faceless assessment as envisaged under Section 144B were contrary to the Act. However, in the present case, a final order was passed after the notice was issued by the JAO, and an appeal was already preferred against this final order. The Court deemed 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 (Appeal), who was directed to consider it and pass appropriate orders within 15 days, taking into account the judgments quashing proceedings based on notices issued by JAOs.
The Rajasthan High Court, Bench at Jaipur, acknowledged that the issue raised by the petitioner regarding the invalidity of notices issued by the Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer stands 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 writ petitions decided on 19.03.2025. The Court noted that the judgment in Sharda Devi Chhajer held that the mandate of Section 151A of the Act of 1961 has to be strictly followed, and JAOs do not have the jurisdiction to issue notices under Section 148, as it weakens Section 151A. Consequently, such notices deserve to be quashed. The Court also referred to an order passed by one of its judges in CWP No.21509/2023 (Jasjit Singh vs. Union of India & Ors.) which reiterated that circulars or instructions cannot override statutory provisions and that notices issued by JAO under Section 148 without conducting faceless assessment are contrary to the Act. However, in the present case, since a final order was passed and an appeal was preferred against it, the Court deemed 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 (Appeal), who was directed to take into consideration the existing judgments and pass appropriate orders within 15 days.
The Tribunal held that notices issued under Section 148 of the Income Tax Act, 1961, by the Jurisdictional Assessing Officer (JAO) for assessment and reassessment are invalid. This is because the scheme of automated allocation based on algorithms and random assignment of assessing officers, as mandated by Section 151A of the Act and the CBDT's faceless regime, requires strict adherence. The JAO does not have the jurisdiction to issue such notices, as it weakens Section 151A and contradicts the legislative intent of making the taxation system transparent and impartial through technology. The court affirmed that instructions and circulars can only supplement statutory provisions, not override them. Consequently, the impugned notice dated 29.03.2025 issued by the JAO for Assessment Year 2021-2022, and all consequential orders, 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 29.03.2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer. The time spent during the litigation was excluded for computing the limitation for fresh notices.
The 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., decided on 19.03.2025. This judgment held that notices issued under Section 148 of the Act by the JAO were invalid as they did not comply with the broader scheme of automated allocation based on algorithms and random assignment of assessing officers, as envisaged by Part 2(i)(a) of the Scheme and mandated by Section 151A of the Act. The Court further observed that the mandate of Section 151A had to be strictly followed, and the JAO lacked jurisdiction to issue such notices. Consequently, the impugned notices were quashed and set aside, with liberty to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, by keeping the FAO as the assessing officer. The time spent during litigation was to be excluded for limitation purposes. The Court also referenced another order by one of its members in CWP No.21509/2023 (Jasjit Singh vs. Union of India & Ors.) which reiterated that circulars could not override statutory provisions and that notices issued by JAO without conducting faceless assessment were contrary to the Act. However, in the present case, since an appeal was already preferred against the final assessment order, the Court deemed it inappropriate to make the appeal redundant. Therefore, the petitioner was directed to file an application before the concerned Commissioner of Income Tax (Appeal), who was directed to consider it and pass appropriate orders within 15 days, taking into account the prior judgments quashing proceedings based on notices issued by the JAO.
The High Court noted that the final assessment order was passed after the notice was issued by the JAO, even though the faceless regime had been introduced. Citing previous judgments in *Jasjit Singh vs. Union of India & Ors.* and *Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr.*, 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 notice was invalid. However, as an appeal had already been preferred against the final order, 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 (Appeal), who was directed to consider the matter and pass appropriate orders within 15 days, taking into account the Court's judgment regarding the quashing of proceedings based on notices issued by the JAO. The Court expressly left undecided the merits of the assessment itself, focusing on the procedural irregularity.
The Tribunal held that notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, are not valid, as they do not comply with the broader scheme of law requiring automated allocation based on algorithms and random assignment of assessing officers. The Court emphasized that the legislative intent behind introducing technology, including artificial intelligence and machine learning, for randomized allocations of cases through the faceless regime is to enhance transparency and impartiality. It was held that Section 151A of the Act must be strictly followed, and the JAO does not have the jurisdiction to issue notices under Section 148, as this would weaken Section 151A. The impugned notices 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 29.03.2022, by keeping the Faceless Assessing Officer (FAO) as the assessing officer. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuing fresh notices. The present writ petition was allowed in terms of these observations.
The High Court held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed. It was observed that any jurisdictional error in the notices issued for assessment and reassessment under Section 148 of the Act, which are not in line with the broader scheme of automated allocation based on algorithms and random assignment of assessing officers, do not withstand the law. The Court found that the JAO does not have the jurisdiction to issue notices under Section 148 of the Act, as doing so would weaken Section 151A and diminish its activation. The Court held that 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 cannot override statutory provisions or make them obsolete, and that authorities cannot usurp legal provisions for their convenience. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuing fresh notices, if required, in compliance with the CBDT Notification dated 29.03.2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer. The present writ petition was allowed in terms of these observations.
The High Court allowed the writ petition, quashing and setting aside the notice dated 27.06.2025 issued by the Jurisdictional Assessing Officer (JAO) for Assessment Year 2021-2022, 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. Adherence to the algorithm-based random assessing system is required for assessment and reassessment under Sections 147, 148, and 148A, in light of the sanction under Section 151A. The Court reasoned that allowing JAOs to issue such notices would weaken Section 151A and undermine the legislative intent of a transparent and impartial taxation system infused with technology. The judgment followed the precedent set by a co-ordinate bench in Sharda Devi Chhajer & Anr. Vs The Income Tax Officer & Anr., which held that notices issued by JAOs under Section 148 without conducting faceless assessment as envisaged under Section 144B are contrary to the Act. The respondents are at 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 litigation is excluded for limitation purposes.
The High Court held that the ITAT's factual findings, which indicated no violation of the trust's objectives, could not be interfered with under Section 260A of the Income Tax Act, 1961, as this provision is meant for adjudicating substantial questions of law. The Court referred to a previous judgment in Commissioner of Income Tax-Exemption, Jaipur Vs. Shri Baba, Balak Nath Seva Sansthan, which stated that if an authority finds objects to be commercial, it must also find a dominant intention of profit-making, which was not the case here. The ITAT's finding that no activity was conducted against the trust's objectives was also a factual determination. The Court found no perversity in the ITAT's findings, as they were based on cogent reasoning and appreciation of evidence. Therefore, the appeal was dismissed for being bereft of merit. The ITAT had set aside the CIT's order, restored the registration granted under Section 12A, and allowed the assessee's appeal.
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 adhering to it. The Court further held that the JAO does not have the jurisdiction to issue notices under Section 148 of the Act, as doing so 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 issued by the JAO were quashed and set aside for want of jurisdiction. The Court reiterated that circulars or instructions cannot override statutory provisions. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuance of fresh notices, if the need arose. The present writ petition was allowed in terms of the co-ordinate bench judgments.
The High Court allowed the writ petition, quashing and setting aside the notice dated 28.06.2025 issued by the Jurisdictional Assessing Officer (JAO) for Assessment Year 2021-2022, 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 is because adherence to the algorithm-based random assessing system is required for assessment and reassessment under Sections 147, 148, and 148A, in light of the sanction under Section 151A. Issuance of notices by the JAO would weaken Section 151A and diminish its activation. The Court relied on the reasoning from a coordinate bench's decision in D.B. Civil Writ Petition No.11787/2024 and a prior decision by one of the judges in CWP No.21509/2023, which held that circulars or instructions cannot override statutory provisions. The ratio decidendi is that notices issued by a JAO for assessment/reassessment under Section 148, bypassing the faceless assessment scheme and algorithm-based allocation, are without jurisdiction and liable to be quashed. The respondents are at 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 is excluded for limitation purposes.
The Court noted that the final assessment order was passed after the notice was issued by the Jurisdictional Assessing Officer, despite the introduction of the faceless regime. While acknowledging the judgments in Jasjit Singh and Sharda Devi Chhajer, which quashed proceedings initiated by JAOs under Section 148, the Court found it inappropriate to make the pending appeal before the Commissioner of Income Tax (Appeals) redundant. Therefore, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals). The Commissioner was directed 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 Court did not decide on the merits of the original assessment but provided a procedural direction to address the jurisdictional issue at the appellate level.
The High Court held that jurisdiction vests exclusively with the Faceless Assessing Officer. Therefore, as long as the judgments in Sharda Devi Chhajer and Hexaware Technologies Ltd. continue to hold the field, notices issued by the Jurisdictional Assessing Officer are legally unsustainable. Consequently, the impugned notice dated 24.03.2024 under Section 148 and the assessment order dated 20.03.2025 under Section 147, along with all consequential proceedings, were quashed for lack of jurisdiction. The Court granted liberty to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to compliance with law, limitation, and other legal requirements. It was further clarified that if the Supreme Court reverses or materially modifies the Hexaware Technologies Ltd. and Sharda Devi Chhajer judgments, the Revenue would be at liberty to act accordingly. The petitioner stated that other grounds were not pressed and undertook to withdraw the appeal filed.
The High Court noted that the issue raised concerning the invalidity of notices issued by the Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer, in contravention of Section 151A of the Income Tax Act, 1961, had been 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 also by one of the judges in CWP No. 21509/2023 (Jasjit Singh vs. Union of India & Ors.). These judgments held that notices issued by JAOs under Section 148 were contrary to the Act and deserved to be quashed. However, since the petitioner had already filed an appeal against the final assessment order before the Commissioner of Income Tax (Appeals), which was pending, the Court deemed it inappropriate to pass an order that would render the appeal redundant. Therefore, 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 previous judgments of the Court quashing proceedings based on notices issued by JAOs.
The Tribunal held that the mandate of Section 151A of the Income Tax Act, 1961, must be strictly followed. Notices issued by the JAO under Section 148 of the Act, and proceedings initiated thereafter without conducting faceless assessment as envisaged under Section 144B, are contrary to the provisions of the Act. The court reasoned that the legislative intent behind introducing technology and an algorithm for randomized allocations was to enhance efficiency, transparency, and impartiality. Allowing local control to prejudice common men undermines this wisdom. Therefore, the JAO does not have the jurisdiction to issue notices under Section 148 as it weakens Section 151A. The impugned notices were quashed and set aside for want of jurisdiction. The revenue was 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 to be excluded for limitation purposes for issuing fresh notices. The court also referenced a prior decision from the Punjab and Haryana High Court in CWP No.21509/2023 (Jasjit Singh vs. Union of India & Ors.) which held that circulars cannot override statutory provisions and that authorities cannot usurp legal provisions for their convenience.
The Tribunal held that the notice dated 30.08.2024, issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2017-2018, by the Jurisdictional Assessing Officer, was legally unsustainable due to lack of jurisdiction. The Tribunal respectfully agreed with the view taken in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra), which established that jurisdiction vests exclusively with the Faceless Assessing Officer. Consequently, the impugned notice and all consequential proceedings were quashed. The Tribunal granted liberty to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to compliance with law, limitation, and other legal requirements. Furthermore, the Revenue was granted liberty to act afresh if the judgments in Hexaware Technologies Ltd. and Sharda Devi Chhajer were reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not pressed at this stage.
The Tribunal held that notices issued by the Jurisdictional Assessing Officer, instead of the Faceless Assessing Officer, are legally unsustainable due to lack of jurisdiction. This decision was based on the respectful agreement with the views expressed in Sharda Devi Chhajer (supra) and Hexaware Technologies Ltd. (supra), which established that jurisdiction vests exclusively with the Faceless Assessing Officer. Consequently, the impugned notice dated 30.08.2024 issued under Section 148 of the Income Tax Act, 1961, for AY 2016-2017, and all consequential proceedings, were quashed for lack of jurisdiction. Liberty was granted to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to compliance with legal requirements and limitations. The Revenue was also granted liberty to act afresh if the Supreme Court reversed or materially modified the judgments in Hexaware Technologies Ltd. and Sharda Devi Chhajer.
The Tribunal held that the notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2022-2023, along with all consequential proceedings, is quashed for lack of jurisdiction. The reasoning was based on the respectful agreement with the view taken by the Division Bench of the Rajasthan High Court in Sharda Devi Chhajer and the Bombay High Court in Hexaware Technologies Ltd., which established that jurisdiction vests exclusively with the Faceless Assessing Officer. Therefore, as long as these judgments hold, notices issued by the Jurisdictional Assessing Officer are legally unsustainable. Liberty was granted to the respondents-Revenue to initiate proceedings afresh through the Faceless Assessing Officer, in accordance with law and subject to limitation and other legal requirements. The Revenue was also granted liberty to act afresh if the Supreme Court reverses, sets aside, or materially modifies the judgments in Hexaware Technologies Ltd. and Sharda Devi Chhajer. The petitioner stated that other grounds were not pressed at this stage.
The Tribunal, in respectful agreement with the Division Bench of the Rajasthan High Court in Sharda Devi Chhajer and the Bombay High Court in Hexaware Technologies Ltd., held that jurisdiction vests exclusively with the Faceless Assessing Officer. Therefore, as long as these judgments hold the field, the issuance of notices by the Jurisdictional Assessing Officer is legally unsustainable. Consequently, the impugned notice dated 18.03.2025 issued under Section 148 of the Income Tax Act, 1961, for AY 2021-2022, along with all consequential proceedings, was quashed for lack of jurisdiction. Liberty was granted to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to compliance with limitation and other legal requirements. The Revenue was also granted liberty to act afresh if the aforementioned judgments are reversed or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not pressed at this stage.
The Tribunal, in respectful agreement with the Division Bench of the Rajasthan High Court in Sharda Devi Chhajer and the Bombay High Court in Hexaware Technologies Ltd., held that jurisdiction vests exclusively with the Faceless Assessing Officer. Consequently, as long as these judgments remained in effect, notices issued by the Jurisdictional Assessing Officer were legally unsustainable. The impugned notice dated 27.08.2024 issued under Section 148 of the Income Tax Act, 1961, for AY 2021-2022, along with all consequential proceedings, were quashed for lack of jurisdiction. Liberty was granted to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to compliance with limitation and other legal requirements. The Revenue was also granted liberty to act afresh if the judgments in Hexaware Technologies Ltd. and Sharda Devi Chhajer were reversed, set aside, or materially modified by the Hon'ble Supreme Court. The other grounds raised by the petitioner were not pressed and were kept open.
The High Court allowed the writ petition, quashing and setting aside the notice dated 01.03.2025 issued by the Jurisdictional Assessing Officer (JAO) for Assessment Year 2021-2022, 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, as this would weaken Section 151A and lead to its diminishing activation. Adherence to the algorithm-based random assessing system is required for assessment and reassessment under Sections 147, 148, and 148A, in light of the sanction under Section 151A. The Court followed the precedent set in Sharda Devi Chhajer & Anr. and Jasjit Singh, stating that circulars or instructions cannot override statutory provisions. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuance of fresh notices, if needed, in compliance with the CBDT Notification dated 29.03.2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer.
The Tribunal held that the notices issued by the Jurisdictional Assessing Officer, instead of the Faceless Assessing Officer, are without jurisdiction. This decision was based on the respectful agreement with the view taken by the Division Bench of the Rajasthan High Court in Sharda Devi Chhajer (supra) and the Bombay High Court in Hexaware Technologies Ltd. (supra), which established that jurisdiction vests exclusively with the Faceless Assessing Officer. Consequently, as long as these judgments remain in effect, the issuance of such notices by the Jurisdictional Assessing Officer is legally unsustainable. The impugned notice dated 30.08.2024 issued under Section 148 of the Income Tax Act, 1961, for AY 2016-2017, along with all consequential proceedings, were quashed for lack of jurisdiction. However, liberty was granted to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, subject to compliance with limitation and other legal requirements. The Revenue was also granted liberty to act in accordance with any reversal or material modification of the Hexaware Technologies Ltd. and Sharda Devi Chhajer judgments by the Supreme Court.
The Court acknowledged that the issue of notices by the JAO instead of a Faceless Assessing Officer, contrary to the faceless regime and Section 151A of the Income Tax Act, 1961, has been adjudicated by coordinate benches in cases like Sharda Devi Chhajer & Anr. vs. The Income Tax Officer & Anr. and Jasjit Singh vs. Union of India & Ors. These judgments held that such notices are invalid and liable to be quashed. However, in the present case, a final assessment order was passed, and an appeal against it was pending before the CIT(A). The Court found it inappropriate to make the pending appeal redundant by quashing the proceedings at this stage. Therefore, the Court directed the petitioner to file an application before the concerned Commissioner of Income Tax (Appeals), who was directed to consider it and pass appropriate orders within 15 days, taking into account the judgments of this Court regarding the quashing of proceedings based on notices issued by the JAO. The writ petition was disposed of with this direction.
The Tribunal held that jurisdiction vests exclusively with the Faceless Assessing Officer. Consequently, as long as the judgments in Sharda Devi Chhajer and Hexaware Technologies Ltd. continue to hold the field, notices issued by the Jurisdictional Assessing Officer are legally unsustainable. Accordingly, the impugned notice dated 30.08.2024 issued under Section 148 of the Income Tax Act, 1961, for A.Y. 2017-2018, along with all consequential proceedings, were quashed for lack of jurisdiction. Liberty was granted to the Revenue to initiate proceedings afresh through the Faceless Assessing Officer, in accordance with law, subject to compliance with limitation and other legal requirements. The Revenue was also granted liberty to act afresh if the judgments in Hexaware Technologies Ltd. and Sharda Devi Chhajer are reversed, set aside, or materially modified by the Hon'ble Supreme Court. The petitioner stated that other grounds were not pressed at this stage.
The High Court allowed the writ petition, quashing and setting aside the notice dated 27.06.2025 issued by the Jurisdictional Assessing Officer (JAO) for Assessment Year 2020-2021, and all consequential orders. The Court followed the decision of a coordinate bench in D.B. Civil Writ Petition No.11787/2024, which held that notices issued under Section 148 of the Income Tax Act, 1961, by the JAO were not sustainable as they did not comply with the mandate of Section 151A of the Act and the scheme of automated, algorithm-based random allocation of cases. The Court emphasized that the legislative intention behind introducing technology for a transparent and impartial taxation system, including faceless assessment under Section 144B, must be strictly followed. The JAO lacks the jurisdiction to issue such notices, which weakens Section 151A. The impugned notices were quashed for want of jurisdiction. The revenue was granted liberty to issue fresh notices in compliance with the CBDT Notification dated 29.03.2022, keeping the Faceless Assessing Officer (FAO) as the assessing officer. The time spent during the pendency of the litigation was to be excluded for computing the limitation for issuing fresh notices, if required. The operative direction was to quash the notice and allow the petition.
The High Court held that notices issued by the Jurisdictional Assessing Officer (JAO) under Section 148 of the Income Tax Act, 1961, are invalid. The Court reasoned that the mandate of Section 151A of the Act, which requires adherence to an algorithm-based random assessing system for assessment and reassessment under Sections 147, 148, and 148A, must be strictly followed. Issuing such notices by the JAO would weaken Section 151A and potentially lead to its diminishing activation. The Court emphasized that legislative intent, vision, and wisdom, as infused through technology for a transparent and impartial taxation system, must be given full meaning. The judgment cited a previous decision by a coordinate bench in D.B. Civil Writ Petition No.11787/2024, which quashed similar notices for want of jurisdiction. Consequently, the impugned notice dated August 27, 2024, issued by the JAO for Assessment Year 2018-2019, and all consequential orders, were quashed and set aside. The respondents were granted liberty to issue fresh notices in compliance with the CBDT Notification dated March 29, 2022, by keeping the Face-less Assessing Officer (FAO) as the assessing officer. The time spent during the litigation was to be excluded for limitation purposes for issuing fresh notices.