SC Allows Revenue to Seek Review Before HC on Faceless Reassessment Notices Issued by JAO

The Income Tax Department filed a large batch of Special Leave Petitions challenging judgments of the Punjab & Haryana High Court which had quashed reassessment notices issued under Section 148 by Jurisdictional Assessing Officers (JAOs).

The High Court had held that after the introduction of Sections 144B and 151A and the e-Assessment of Income Escaping Assessment Scheme, 2022, reassessment proceedingsmust be conducted in a faceless manner and could not be initiated by JAOs. These rulings relied upon earlier decisions in Jasjit Singh v. Union of India and Jatinder Singh Bhangu v. Union of India, which had set aside such notices for lack of jurisdiction.

Main Issue: Whether reassessment notices issued under Section 148 by Jurisdictional Assessing Officers, instead of through the faceless mechanism mandated under Sections 144B and 151A, were legally sustainable.

SC’s Order: The Supreme Court disposed of all the Special Leave Petitions without adjudicating the merits. The Court permitted the Revenue to file applications before the respective High Courts in the already disposed writ petitions to bring on record a later statutory clarification proposed to be inserted with effect from 01.04.2021 in the Finance Act.

The High Courts were directed to consider such applications afresh after hearing both sides. Liberty was reserved to the aggrieved party to approach the Supreme Court again if unsuccessful.

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