The CBDT has issued a notification bearing no.18 / 2022 / F.No.370142 / 16 / 2022 -TPL dated 29.03.2022 wherein it has been clarified that assessment/reassessment / re-computation u/s.147 of the Income Tax Act and issuance of notice u/s.148 of the Act shall be through automated allocation, in accordance with Risk Management Strategy formulated by the Board and in a faceless manner. It appears clear through the notification that the notice u/s.148 itself is to be issued only by the faceless Assessing Officer (AO) and not by the Jurisdictional Assessing Officer (JAO). The issue of whether a notice u/s.148 issued by the JAO is valid or not has come up for consideration before the Telangana High Court in Kankanala Ravindra Reddy v ITO [2023] 295 Taxman 652 (Telangana)
In this case, the impugned proceedings u/s.148A as well as the consequential notice u/s.148 were issued by the JAO and not in the prescribed faceless manner. The Telangana High Court after considering the notification of the Board as also the provisions of section 130 which gives the power to the CBDT to frame the scheme called a “Faceless Jurisdiction of Income Tax Authorities Scheme 2022” has come to the conclusion that the notice issued by the JAO u/s.148 is not a valid notice. The Telangana High Court in this case also referred to the provisions of section 151A(1) inserted with effect from 01.11.2020 which refers to faceless assessment of income escaping assessment to arrive at the aforesaid conclusion.
Thus, it can be seen that the Telangana High Court in categorical terms holds that the notice issued by a JAO u/s.148 and the procedure followed u/s.148A by the JAO will invalidate the proceedings of reassessment and that no reassessment can be proceeded on the basis of such notice
This decision it may be noticed is of a decision of the Division Bench of the Telangana High Court. It may also be noted that a Single Judge of the Calcutta High Court in Sanghi Steel Udyog Pvt Ltd v UOI TS-693-HC-2023 (Cal) and Triton Overseas (P) Ltd v UOI [2023] 156 Taxmann.com 318 (Cal) has however held that the notices issued u/s.148 by the JAO instead of NaFAC does not invalidate the proceedings and that the JAO is not bereft of jurisdiction over the assessee, but continues to have jurisdiction over the assessee.
# Income Tax, # section 148, # reopening, # JAO, # NaFAC, # CBDT Notification, # Notice, # Validity
