HC Quashes Reassessment Notice Issued by Jurisdictional Officer Instead of Faceless Officer

The petitioner in this matter, challenged a reassessment notice dated 24 March 2024 and the consequential assessment order dated 21 March 2025 passed under Sections 147 and 148 of the Income Tax Act, 1961.

The primary grievance was that the notice was issued by the Jurisdictional Assessing Officer (JAO) instead of the Faceless Assessing Officer (FAO), contrary to the statutory faceless regime notified on 29 March 2022.

Main Issue: Whether a reassessment notice under Section 148 of the Income Tax Act, 1961 issued by a Jurisdictional Assessing Officer (JAO) instead of a Faceless Assessing Officer (FAO) under the 2022 Faceless Assessment Scheme is valid.

HC’s Decision: The Court held that the Gujarat High Court’s view in Talati & Talati LLP was inapplicable to the present case and distinguished on facts. The Court observed that the Bombay High Court in Abhin Anilkumar Shah v. ITO [(2024) had clarified that CBDT’s earlier orders dated 31 March 2021 and 6 September 2021 carved out limited exceptions to the faceless scheme for assessment proceedings only, not for reassessment notices under Section 148.

Relying on Hexaware Technologies Ltd. and subsequent approvals of the same view by other High Courts (including Telangana High Court in Venkataramana Reddy Patloola v. DCIT, upheld by the Supreme Court on 16 July 2025), the Rajasthan High Court held that reassessment notices issued by JAOs under Section 148 are invalid.

Thus, the notice dated 24 March 2024 and the assessment order dated 21 March 2025 were quashed. However, the Court granted liberty to the Revenue to revive the proceedings if the Supreme Court later overturns Hexaware Technologies Ltd., Shree Cement Ltd., or Sharda Devi Chhajer.

The petitioner was directed to withdraw his pending appeal.

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