Rajasthan High Court – Jaipur
Shree Cement Limited vs Assistant Commissioner Of Income Tax … on 5 August, 2025
Author: Anand Sharma
Bench: Anand Sharma
[2025:RJ-JP:29991-DB]
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
D. B. Civil Writ Petition No. 10540/2024
Shree Cement Limited, Having its office at Bangur Nagur,
Andheri Deori, Masuda Road, Beawar, Ajmer- 305901, Rajasthan
through its Joint President Shri Arvind Khicha, S/o Shri Indermal
Khicha, Aged About 60 Years R/o 5-6, Nanesh Nagar, Near
Jawahar Bhawan, Vinod Nagar, Beawar, Rajasthan- 305901.
----Petitioner
Versus
1. Assistant Commissioner of Income Tax, Central Circle, Cr
Building, Opp. Sessions Court, Jaipur Road, Ajmer,
Rajasthan- 305001
2. Additional Commissioner of Income Tax, Central Circle,
Aaykar Bhawan, Subcity Centre, Savina, Udaipur,
Rajasthan- 313001
3. Principal Commissioner of Income Tax, Central Circle, 4Th
Floor, Jeevan Nidhi- II, LIC Building, Bhawani Singh Road,
Jaipur, Rajasthan- 302005
4. Director General of Income Tax (Investigation), New
Central Revenue Building, Statue Circle, Jaipur,
Rajasthan- 302005
5. Union of India, through The Secretary, Department of
Revenue, Government of India, North Block, New Delhi-
110001
----Respondents
For Petitioner : Mr. Percy Pardiwala, Sr. Adv.
Mr. Anant Kasliwal, Sr. Adv. assisted
by Mr. Niraj Sheth Advocate,
Mr. Shashank Kasliwal Advocate,
Mr. Raghav Krishnatri Advocate,
Mr. Diwakar Khaldwa Advocate &
Ms. Divisha Misra Advocate.
For Respondents No. : Mr. Siddharth Bapna Advocate with
1 and 2 Mr. Sarvesh Jain Advocate,
Mr. Meyhul Miittal Advocate &
Mr. Rahul Kumar Advocate.
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HON'BLE THE CHIEF JUSTICE MR. K.R. SHRIRAM
HON'BLE MR. JUSTICE ANAND SHARMA
JUDGMENT
REPORTABLE
05/08/2025
(Per: Chief Justice)
1. Petitioner impugns the legality and validity of notice dated
31st March 2024 issued under Section 148A(b) of the Income Tax
Act, 1961 (for short, 'the Act'), reassessment notice dated 1 st May
2024 issued under Section 148 of the Act and order dated 1 st May,
2024 passed under Section 148A(d) of the Act. According to
petitioner, these are all invalid, illegal, barred by limitation and
issued wholly without jurisdiction.
2. Petitioner is engaged in the business of manufacturing and
sale of cement. Petitioner, (hereinafter referred to as assessee),
filed its return of income on 31st November 2017 for Assessment
Year 2017-18 declaring total income of Rs. 4,53,70,36,160/-.
Assessee declared gross total income of Rs. 17,00,70,85,867/-
and after claiming deduction of Rs. 12,47,00,49,710/- arrived at
declared total income of Rs. 4,53,70,36,160/-. This return was
later revised on 31st March 2019 with a returned income of Rs.
2,87,91,24,160/- by declaring gross total income of Rs.
16,33,35,78,814/-, in which a deduction of Rs. 13,45,44,54,657/-
was claimed.
3. An assessment under Section 143(3) of the Act was
completed on 12th August 2021 by making various additions.
Against the said assessment order, assessee preferred an appeal
before the Commissioner of Income Tax (Appeals) [for short
'CIT(A)'], who vide order dated 8th June 2023 partially allowed
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assessee's appeal. This order was challenged by assessee before
Income Tax Appellate Tribunal, Jaipur Bench, Jaipur (for short
'ITAT'), which allowed the appeal. It is petitioner's case and
rightly so, that orders passed by Assessing Officer, CIT(A) as also
ITAT confirms the fact that petitioner was entitled to deduction
under Section 80IA of the Act. Quantum was the only issue.
4. In the meanwhile, before the appeal was heard by the ITAT,
between 21st June 2023 to 26th June 2023, a survey action under
Section 133A of the Act was conducted in the case of assessee.
According to Revenue, during the course of survey proceedings,
new facts and information came to notice of the department,
which established that deduction under Section 80IA of the Act
claimed by assessee on account of profit from Solid Waste
Management System (SWM), profit from Water Treatment System
(WTS) and profit from Power Generated by New India Power
Undertaking (NIPU) are not admissible for various reasons. What
are the reasons, according to the department, can be found in the
impugned order dated 1st May 2024 passed under Section
148A(d) of the Act.
5. During the course of original assessment proceedings,
various queries were raised under Section 143(2) of the Act and
reply was given by assessee. Details of the notices as also the
replies can be found in Paragraph No. 4.3 and 4.4 of the petition.
One thing is clear from the queries raised as also the replies
given, was that the Assessing Officer was considering deduction
claimed by petitioner under Section 80IA of the Act.
6. Based on the observations of the survey team, Respondent
No. 1, namely Assistant Commissioner of Income Tax (ACIT),
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issued impugned notice dated 31st March 2024. In the notice, it
was alleged that new facts came to light during the survey
proceedings which established that deduction of Rs.
8,41,25,44,299/- claimed by petitioner under Section 80IA on
profits of SWM, WTS and NIPU was not admissible as no SWM,
WTS and NIPU, as envisaged under Section 80IA of the Act, were
in existence in petitioner's premises and the claim was
unsustainable on facts and in law.
Based on such survey proceedings, Respondent No. 1
alleged that he was in possession of information suggesting that
income chargeable to tax had escaped assessment.
7. By a communication dated 25th April 2024, petitioner filed a
detailed response to impugned notice dated 31 st March 2024 and
showed cause as to why petitioner was entitled to deduction
claimed under Section 80IA of the Act. In the reply, petitioner
submitted, inter alia, that
(a) impugned notice seeking to invoke provisions under Section
148 of the Act was barred by limitation;
(b) deduction claimed under Section 80IA of the Act had been
subjected to detailed scrutiny during original assessment
proceedings and thus, proceedings were based on change of
opinion;
(c) since the notice was issued beyond the period of three years
from the end of relevant assessment year, satisfaction of the
conditions of Section 149(1)(b) of the Act was necessary and
mere information was not sufficient;
(d) deduction under Section 80IA of the Act would not fall within
any of the terms prescribed in Section 149(1)(b) of the Act, i.e.,
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possession of books of accounts or other documents or evidence
which revealed that income chargeable to tax had escaped
assessment and such income should be represented in the form of
(i) asset (ii) expenditure in relation to an event/occasion and (iii)
entries in the books of accounts. The claim of deduction under
Section 80IA of the Act cannot satisfy all three criteria prescribed
under Section 149(1)(b) etc.
8. Notwithstanding this reply, Respondent No. 1 passed
impugned order dated 1st May 2024 under Section 148A(d) of the
Act rejecting petitioner's objections to reopen. Respondent No. 1
reiterated and repeated the allegations made in impugned notice
and came to a conclusion that petitioner had claimed wrong
deduction to the extent of Rs. 8,41,25,44,299/- under Section
80IA of the Act. Along with impugned order, Respondent No. 1
also issued impugned assessment notice dated 1 st May 2024
under Section 148 of the Act.
9. Being aggrieved by this notice as also order passed and
referred to hereinabove, petitioner has filed this petition on
various grounds. The issues that arise are:
(A) Whether the notice dated 1st May 2024 issued under Section
148 of the Act is barred by limitation as per first proviso to
Section 149 of the Act?
(B) Whether impugned notice dated 1st May 2024 is invalid and
bad in law being issued by Jurisdictional Assessing Officer (JAO)
and not Faceless Assessing Officer (FAO)?
(C) Whether the issues raised in impugned order show an alleged
escapement of income represented in the form of an asset or
expenditure in respect of transaction in relation to an event or an
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entry in the books of accounts as required under Section 149(1)
(b) of the Act?
(D) Whether Respondent No. 1 has proposed to reopen on the
basis of change of opinion? and
(E) When the claim of deduction under Section 80IA of the Act
has been consistently allowed in favour of petitioner by Assessing
Officer and the Appellate Authority in the earlier years can the
Assessing Officer carry a belief that there is escapement of
income.
10. Identical issues have been considered by a Division Bench of
High Court of Bombay, authored by one of us (the Chief Justice),
in Hexaware Technologies Ltd. v. Assistant Commissioner
of Income-tax, Circle 15(1)(2)1.
Issue 'A':
11. In Hexaware Technologies Ltd. (supra) also, the issue
under consideration was whether notice issued under Section 148
of the Act was barred by limitation. That question came to be
answered by the Court in Paragraph Nos. 24 to 30 thereof. It is
also settled law that validity of notice under Section 148 of the
Act must be judged on the basis of law existing on the date on
which such notice is issued. Paragraph Nos. 24 to 30 of the
decision of Hexaware Technologies Ltd. (supra) read as under:
"24. As regards issue no. 2, Section 149 of the Act reads as under:
149. Time limit for notice.--(1) No notice under section 148
shall be issued for the relevant assessment year,--
(a) if three years have elapsed from the end of the relevant
assessment year, unless the case falls under clause (b);
[(b) if three years, but not more than ten years, have elapsed
from the end of the relevant assessment year unless the Assessing
1 [2024] 162 taxmann.com 225 (Bombay)
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Officer has in his possession books of account or other documents or
evidence which reveal that the income chargeable to tax, represented
in the form of--
(i) an asset;
ii) expenditure in respect of a transaction or in relation to an event or
occasion; or
(iii) an entry or entries in the books of account,
which has escaped assessment amounts to or is likely to amount to
fifty lakh rupees or more:]
Provided that no notice under section 148 shall be issued at any time
in a case for the relevant assessment year beginning on or before 1st
day of April, 2021, if 28[a notice under section 148 or section 153A or
section 153C could not have been issued at that time on account of
being beyond the time limit specified under the provisions of clause
(b) of sub-section (1) of this section or section 153A or section 153C,
as the case may be], as they stood immediately before the
commencement of the Finance Act, 2021:
Provided further that the provisions of this sub-section shall not apply
in a case, where a notice under section 153A, or section 153C read
with section 153A, is required to be issued in relation to a search
initiated under section 132 or books of account, other documents or
any assets requisitioned under section 132A, on or before the 31st
day of March, 2021:
[Provided also that for cases referred to in clauses (i), (iii) and (iv) of
Explanation 2 to section 148, where,-
(a) a search is initiated under section 132; or
(b) a search under section 132 for which the last of authorisations is
executed; or
(c) requisition is made under section 132A,
after the 15th day of March of any financial year and the period for
issue of notice under section 148 expires on the 31st day of March of
such financial year, a period of fifteen days shall be excluded for the
purpose of computing the period of limitation as per this section and
the notice issued under section 148 in such case shall be deemed to
have been issued on the 31st day of March of such financial year:
Provided also that where the information as referred to in Explanation
1 to section 148 emanates from a statement recorded or documents
impounded under section 131 or section 133A, as the case may be, on
or before the 31st day of March of a financial year, in consequence of,
--
(a) a search under section 132 which is initiated; or
(b) a search under section 132 for which the last of authorisations is
executed; or
(c) a requisition made under section 132A,
after the 15th day of March of such financial year, a period of fifteen
days shall be excluded for the purpose of computing the period of
limitation as per this section and the notice issued under clause (b) of
section 148A in such case shall be deemed to have been issued on the
31st day of March of such financial year:]
Provided also that for the purposes of computing the period of
limitation as per this section, the time or extended time allowed to the
assessee, as per show-cause notice issued under clause (b) of section
148A or the period during which the proceeding under section 148A is
stayed by an order or injunction of any court, shall be excluded:
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Provided also that where immediately after the exclusion of the period
referred to in the immediately preceding proviso, the period of
limitation available to the Assessing Officer for passing an order under
clause (d) of section 148A 30[does not exceed seven days], such
remaining period shall be extended to seven days and the period of
limitation under this sub-section shall be deemed to be extended
accordingly.
Explanation.-For the purposes of clause (b) of this sub-section,
“asset” shall include immovable property, being land or building or
both, shares and securities, loans and advances, deposits in bank
account.
[(1A) Notwithstanding anything contained in sub-section (1), where
the income chargeable to tax represented in the form of an asset or
expenditure in relation to an event or occasion of the value referred to
in clause (b) of sub-section (1), has escaped the assessment and the
investment in such asset or expenditure in relation to such event or
occasion has been made or incurred, in more than one previous years
relevant to the assessment years within the period referred to in
clause (b) of sub-section (1), a notice under section 148 shall be
issued for every such assessment year for assessment, reassessment
or recomputation, as the case may be.]
(2) The provisions of sub-section (1) as to the issue of notice shall be
subject to the provisions of section 151.]The first proviso to Section 149 of the Act provides that no notice
under section 148 shall be issued at any point of time in a case for a
relevant assessment year beginning on or before the 1st day of April
2021, if a notice under section 148 could not have been issued at that
time on account of being beyond the time limit specified under the
provision of clause (b) of sub-section (1) of this Section, as it stood
immediately before the commencement of the Finance Act, 2021. The
term ‘at that time’ in the first proviso refers to the date on which
notice under section 148 is to be issued by the Assessing Officer. The
term ‘at that time’ has to refer to the term ‘at any time’ used earlier in
the said proviso. The reference to ‘at any time’ is to the date of the
notice to be issued by the Assessing Officer and, therefore, the term
‘at that time’ would also refer to the said date. On the said date, if a
notice could not have been issued under the erstwhile provision of
Section 149(1)(b) of the Act, for any assessment year beginning on or
before the 1st day of April 2021, the notice cannot be issued even
under the new provisions.
25. Section 149(1)(b) of the erstwhile provisions provided a time limit
of six years from the end of the relevant assessment year for issuing
notice under section 148 of the Act. For the relevant assessment year,
being Assessment Year 2015-2016, 6th year expired on 31st March
2022. The notice under section 148 of the Act, in the present case, is
issued on 27th August 2022, i.e., clearly beyond the period of
limitation prescribed in Section 149 read with the first proviso to the
said section. This is squarely covered by paragraphs 36 and 37 of New
India Assurance (supra) which has been reproduced above in
paragraph 23.
26. The purpose of the first proviso to Section 149 of the Act is
consistent with the stated object of the government to make
prospective amendments in the Act. Accordingly, the proviso provides
that up to Assessment Year 2021-2022 (period before the
amendment), the period of limitation as prescribed in the erstwhile
provisions of Section 149(1)(b) of the Act would be applicable and
only from Assessment Year 2022-2023, the period of ten years as
provided in Section 149(1)(b) of the Act, would be applicable. The
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submission of the Revenue to interpret the first proviso to Section 149
of the Act to be applicable only for Assessment Years 2013-2014 and
2014-2015, i.e., for assessment years where the period of limitation
had already expired on 1st April 2021 is not sustainable. The
interpretation canvassed by the Revenue is clearly contrary to the
plain language of the proviso. When the language in the statute is
clear, it has to be so interpreted and there is no scope for interpreting
the provision on any other basis. The taxing statue should be strictly
construed. [Godrej & Boyce Mfg. Co. Ltd. v. Dy. CIT [2017] 81
taxmann.com 111/247 Taxman 361/394 ITR 449 (SC).
27. The interpretation as canvassed by the Revenue would render the
first proviso to Section 149 of the Act redundant and otiose. The time
limit to issue notice under section 148 of the Act had already expired
on 1st April 2021 for Assessment Year 2013-2014 and 2014-2015,
when Section 149 of the Act was amended. Therefore, reopening for
Assessment Years 2013-2014 and 2014-2015 had already been
barred by limitation on 1st April 2021. Accordingly, the extended
period of ten years as provided in Section 149(1)(b) of the Act would
not have been applicable to Assessment Years 2013-2014 and 2014-
2015, de hors the proviso. It is a settled principle of law that when
limitation has already expired, it cannot be revived by way of a
subsequent amendment and, hence, for Assessment Years 2013-2014
and 2014-2015 proviso to Section 149 of the Act was not required.
Hence, to give meaning to the proviso it has to be interpreted to be
applicable for’ Assessment Years upto 2021-2022. In CIT v. Onkarmal
Meghraj (H.U.F.) [1974] 93 ITR 233 (SC), the Hon’ble Apex Court was
dealing with the question whether a proviso could be applied without
reference to any period of limitation. It held that “it is a well-settled
principle that no action can be commenced where the period within
which it can be commenced has expired. It is unnecessary to cite
authorities in support of this position. Does the fact that the second
proviso says that there is no period of limitation make a difference?”
The interpretation canvassed by the Revenue would render the
following parts of the proviso redundant –
(i) ‘at any time’ in the first line of the proviso.
(ii) ‘beginning on or before 1st day of April, 2021,’ in the second
line of the proviso.
(iii) ‘at that time’ in the fourth line of the proviso.
If we have to give effect to the interpretation suggested by the
Revenue, then the proviso would have read as under :
“Provided that no notice under section 148 shall be issued at any
time in a case for the relevant assessment year beginning on or
before 1st day of April, 2021, if a notice under section 148 or
Section 153A or Section 153C could not have been issued at that
time [on 1st day of April, 2021] on account of being beyond the
time limit specified under the provisions of clause (b) of sub-
section (1) of this Section or Section 153A or Section 153C, as the
case may be, as they stood immediately before the
commencement of the Finance Act, 2021; OR
Provided that no notice under section 148 shall be issued at any
time in a case for the relevant assessment year beginning on or
before 1st day of April, 2021, if a notice under section 148 or
Section 153A or Section 153C could not have been issued at that
time [on 1st day of April, 2021] on account of being beyond the
time limit specified under the provisions of clause (b) of sub-
section (1) of this Section or Section 153A or Section 153C, as the
case may be, as they stood immediately before the
commencement of the Finance Act, 2021“.
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28. Section has to be interpreted so as to give meaning to all the
words/phrases used in the Section and it should not be interpreted in
such a way so as to render any part or phrase in the Section otiose.
As stated aforesaid, if the interpretation canvassed by the Revenue is
to be accepted then, not only various parts of the Section would be
rendered otiose, one would have to also substitute one phrase with
another phrase in the said Section, which is clearly not permissible in
law. Reliance in this regard is placed on the decision of the Hon’ble
Apex Court in the case of CIT v. Sham L. Chellaram [2015] 54
taxmann.com 348/373 ITR 292 (Bom.).
29. It was submitted on behalf of Revenue that the period of
limitation for the purposes of Section 149 of the Act has to be seen
with respect to the original notice under section 148 of the Act, which
was issued to petitioner on 8th April 2021 and as the said notice was
issued within the period of six years from the end of the relevant
assessment year, which was expiring on 31st March 2022, the
reassessment proceedings are within the period of limitation
prescribed in Section 149 of the Act. It is not acceptable.
Section 149 of the Act sets out, inter alia, the time limit for issuing
notice under section 148 of the Act. Apart from the period of limitation
set out in the said Section, the first proviso lays down a further
restriction on the issue of a notice under section 148 of the Act. The
period of limitation as well as the said further restriction is
framed/provided in respect of a notice under 148 of the Act, and not
for a notice under section 148A of the Act. The notice dated 8th April
2021, which though originally issued as a notice under section 148 of
the Act, (under the provisions of the Act prior to the amendments
made by the Finance Act, 2021), has now been treated as a notice
issued under section 148A(b) of the Act in accordance with the
decision of the Hon’ble Apex Court in Ashish Agarwal (supra). Once
the notice dated 8th April 2021 has been treated as having been
issued under section 148A(b) of the Act, the said notice is no longer
relevant for the purpose of determining the period of limitation
prescribed under section 149 or the restriction as per the first proviso
below Section 149 of the Act. Therefore, for considering the restriction
on issue of a notice under section 148 of the Act prescribed in the first
proviso to Section 149 of the Act, the fresh/presently impugned notice
dated 27th August 2022 issued under section 148 of the Act is
required to be considered. The said notice is admittedly beyond the
erstwhile period of limitation of six years prescribed by the Act prior to
its amendment by the Finance Act, 2021. For the Assessment Year
2015-2016, the erstwhile time limit of six years expired on 31st March
2022 and, the impugned notice under section 148 of the Act has been
issued on 27th August 2022 and, therefore, the impugned notice
dated 27th August 2022 is barred by the restriction of the first proviso
to Section 149 of the Act.
30. With respect to applicability of the fifth proviso and the sixth
proviso to Section 149(1)(b) of the Act for extension of limitation for
issuing the notice under section 148 of the Act, fifth and sixth provisos
are only applicable with respect to the period of limitation prescribed
in Section 149(1) of the Act, i.e., three years or ten years, as the case
may be. Fifth proviso or sixth proviso extend limitation for issuing
notice under section 149 of the Act, however, the first proviso is an
exception to the period of limitation and provides for a restriction on
the notices under section 148 being issued for Assessment Years upto
2021-22 beyond a certain date. Therefore, the way the Section would
operate, is first to decide whether a notice issued under section 148 of
the Act is within the period of limitation in terms of Section 149(1)(a)
or (b) of the Act. To decide whether the notice is within the period of
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limitation under section 149(1)(a) or (b) of the Act, the extension of
time as per the fifth and/or sixth proviso would be considered. Once,
the notice is otherwise within the period of limitation, thereafter one
has to see whether the said time limit is within the restriction
provided in the first proviso or not. If the notice is beyond the
restriction period, the notice is invalid. The fifth and/or the sixth
proviso cannot apply at this stage to extend the period of restriction
as per the first proviso. Hence, if a notice is not within the time
prescribed under the first proviso to Section 149(1) of the Act, then
such period cannot be extended by fifth proviso and sixth proviso. In
Godrej Industries Ltd. (supra) paragraph 15 reads as under :
15. Based on petitioner’s facts, the show cause notice
under section 148A(b) of the Act was issued on 24th May
2022 asking petitioner to furnish a reply by 8th June 2022.
Petitioner filed a detailed reply in response to the show
cause notice on 8th June 2022 and, therefore, only the
period from 24th May 2022 to 8th June 2022 could be
excluded by virtue of the first limb of the fifth proviso to
Section 149 of the Act. Subsequently, petitioner received
another letter dated 28th June 2022 which annexed certain
details and provided further time for making detailed
submissions upto 8th July 2022. Petitioner replied to the
letter and made detailed submissions on 2nd July 2022.
Therefore, even assuming this period is to be excluded, the
period which could be excluded is only from 24 th May 2022
to 8th June 2022. Even after considering the letter dated
28th June 2022 and the reply dated 2nd July 2022, at the
highest a further period from 28th June 2022 to 8th July
2022 could be excluded but the period of time from 8th
June 2022 to 28th June 2022 cannot be excluded as per
the fifth proviso. This is because petitioner on 8th June
2022 did not request for any further time and furnished its
response to the show cause notice under section 148A(b)
of the Act. It is the Assessing Officer who has suo moto
issued another letter on 28th June 2022 asking petitioner
to furnish further details by 8th July 2022. Therefore, even
assuming a period of 27 days (i.e., 16 days from 24th May
to 8th June and 11 days from 28th June to 8th July) are
excluded from the date of the impugned notice under
section 148 of the Act issued on 31st July 2022, the
impugned notice would yet be barred by limitation and
could not have been issued by virtue of the first proviso to
Section 149 of the Act.
Even if the fifth and sixth provisos are held to be
applicable, the impugned notice would still be beyond the
period of limitation. The fifth proviso extends limitation
with respect to the time or extended time allowed to an
assessee as per the show cause notice issued under
section 148A(b) of the Act or the period, during which the
proceeding under section 148A of the Act are stayed by an
order of injunction by any Court. Hence, in the present
case, in view of the fifth proviso, the period to be excluded
would be counted from 25th May 2022, i.e., the date on
which the show cause notice was issued under section
148A(b) of the Act by respondent no. 1 subsequent to the
decision of the Hon’ble Apex Court in the case of Ashish
Agarwal (supra) and upto 10th June 2022, which is a
period of 16 days. Further, the time period from 29th June
2022 upto 4th July 2022 cannot be excluded as the same
was not based on any extension sought by petitioner, but
at the behest of respondent no. 1. Even if the same was to
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be excluded, still it will mean further exclusion of 5 days.
Considering the said excluded period as well, the impugned
notice dated 27th August 2022 is still beyond limitation.
The fact that the original notice dated 8th April, 2021
issued under section 148 of the Act, was stayed by this
Court on 3rd August 2021, and its stay came to an end on
29th March 2022 on account of the decision of this Court,
will not be relevant for providing extension as per the fifth
proviso. The fifth proviso provides for extension for the
period during which the proceeding under section 148A of
the Act is stayed. The original stay granted by this Court
was not with respect to the proceeding under section 148A
of the Act, but with respect to the proceeding initiated as
per the erstwhile provision of Section 148 of the Act and,
hence, such stay would not extend the period of limitation
as per the fifth proviso to Section 149 of the Act. The
question of applicability of the sixth proviso does not arise
on the facts of the present case. We find support for this in
Godrej Industries Ltd. (supra).
In view of the aforesaid, the impugned notice dated 27th
August 2022 is clearly barred by the law of limitation.”
12. In this case, as it pertains to Assessment Year 2017-18, six
years period would have expired on 31 st March 2024 whereas
notice under Section 148 of the Act itself came to be issued on 1 st
May 2024. Mr. Siddharth Bapna, counsel for Revenue, made an
attempt to argue that fifth and sixth provisos to Section 149 (1)
(b) of the Act would save the period of limitation for issuing notice
under Section 148 of the Act. We are afraid we do not agree with
him. Same argument was raised in Hexaware Technologies
Ltd. (supra) and was rejected. The Court held, with respect to
applicability of fifth and sixth provisos to Section 149(1)(b) of the
Act for extension of limitation for issuing notice under Section 148
of the Act, fifth and sixth provisos are only applicable with respect
to the period of limitation prescribed under Section 149(1) of the
Act, i.e., three years or ten years, as the case may be. The Court
also held that fifth and sixth provisos extend limitation for issuing
notice under Section 149 of the Act, however, first proviso is an
exception to the period of limitation and provides for a restriction
on the notices under Section 148 of the Act being issued for
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[2025:RJ-JP:29991-DB] (13 of 22) [CW-10540/2024]
assessment years up to 2021-22 (in this case, it is Assessment
Year 2017-18) beyond a certain date. Therefore, the way the
section would operate, is to first decide whether a notice issued
under Section 148 of the Act is within the period of limitation
under Section 149(1)(a) or (b) of the Act. To decide whether the
notice is within the period of limitation under Section 149(1)(a) or
(b) of the Act, the extension of time as prescribed in fifth and/or
sixth proviso would be considered. The Court further held once,
the notice is otherwise within the period of limitation, thereafter
one has to see whether the said limit is within the prescribed
restriction provided in first proviso or not. If the notice is beyond
the restriction period, the notice is invalid, and the fifth and/or the
sixth proviso cannot apply at this stage to extend the period of
restriction as per first proviso. Hence, if a notice is not within the
time prescribed under first proviso to Section 149(1) of the Act,
then such period cannot be extended by fifth or sixth proviso. In
Hexaware Technologies Ltd. (supra), the Court had relied upon
another judgment of Bombay High Court in Godrej Industries
Ltd. vs. Assistant Commissioner of Income Tax & Others 2,
which was also authored by one of us (the Chief Justice), where
Paragraph No. 15 reads as under:
“15. The validity of a notice must be judged on the basis of the law
existing as on the date on which the notice is issued under s. 148 of
the Act, which in the present case is 31st July, 2022, by which time
the Finance Act, 2021 is already on the statute and in terms thereof,
no notice under s. 148 of the Act for asst. yr. 2014-15 could be issued
on or after 1st April, 2021 based on the first proviso to s. 149 of the
Act. Therefore, the fifth proviso cannot apply in a case where the first
proviso applies because, if a notice under s. 148 of the Act could not
be issued beyond the time period provided in the first proviso, then
the fifth proviso could not save such notices. The fifth proviso can only
apply where one has to determine whether the time-limit of three
years and ten years in s. 149(1) of the Act are breached.”
2 (2024) 338 CTR (Bom) 25
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[2025:RJ-JP:29991-DB] (14 of 22) [CW-10540/2024]
13. In fact, Mr. Pardiwala, Senior Advocate brought to notice of
the Court that what has been quoted in Paragraph No. 30 in
Hexaware Technologies Ltd. (supra) is actually Paragraph No.
12 in Godrej Industries Ltd. (supra) and correct quotation
should have been Paragraph No. 15 which is quoted above.
14. In the circumstances, since the case at hand pertains to
Assessment Year 2017-18, the law as laid down by High Court of
Bombay will squarely apply and the notice issued under Section
148 of the Act on 1st May 2024 will be barred by limitation.
Issue ‘B’:
15. Admittedly notice under Section 148 of the Act was issued
by JAO and not FAO. This issue also came up to be discussed and
considered in Hexaware Technologies Ltd. (supra), where the
Court in Paragraphs No. 32 to 39 held as under:
“32. As regards issue no. 4, Section 151A reads as under:
151A. Faceless assessment of income escaping assessment.–(1)
The Central Government may make a scheme, by notification in
the Official Gazette, for the purposes of assessment, reassessment
or recomputation under section 147 or issuance of notice under
section 148 [or conducting of enquiries or issuance of show-cause
notice or passing of order under section 148A] or sanction for issue
of such notice under section 151, so as to impart greater efficiency,
transparency and accountability by–
(a) eliminating the interface between the income-tax
authority and the assessee or any other person to the extent
technologically feasible;
(b) optimising utilisation of the resources through economies of
scale and functional specialisation;
(c) introducing a team-based assessment, reassessment,
recomputation or issuance or sanction of notice with dynamic
jurisdiction.
(2) The Central Government may, for the purpose of giving effect
to the scheme made under sub-section (1), by notification in the
Official Gazette, direct that any of the provisions of this Act shall
not apply or shall apply with such exceptions, modifications and
adaptations as may be specified in the notification:
Provided that no direction shall be issued after the 31st day of
March, 2022.
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[2025:RJ-JP:29991-DB] (15 of 22) [CW-10540/2024]
(3) Every notification issued under sub-section (1) and sub-section
(2) shall, as soon as may be after the notification is issued, be laid
before each House of Parliament.
Section 151A of the Act gives the power to the Central Board of
Direct Taxes (“CBDT”) to notify the Scheme for:
(i) the purpose of assessment, reassessment or recomputation
under section 147; or
(ii) issuance of notice under section 148; or
(iii) conducting of inquiry or issuance of show cause notice or
passing of order under section 148A; or
(iv) sanction for issuance of notice under section 151;
so as to impart greater efficiency, transparency and accountability
by inter alia eliminating the interface between the Income-tax
Authorities and assessee. Sub-section 3 of Section 151A of the Act
also provides that every notification issued under sub-section (1)
and (2) of Section 151A of the Act shall be laid before each House
of Parliament.
In exercise of the powers conferred by sub-sections (1) and (2) of
Section 151A of the Act, CBDT issued a notification dated 29th
March, 2022 [Notification No. 18/2022/F.No.370142/16/2022-TPL
and formulated a Scheme. The Scheme provides that –
(a) the assessment, reassessment or recomputation under
section 147 of the Act,
(b) and the issuance of notice under section 148 of the Act,
shall be through automated allocation, in accordance with risk
management strategy formulated by the Board as referred to in
Section 148 of the Act for issuance of notice and in a faceless
manner, to the extent provided in Section 144B of the Act with
reference to making assessment or reassessment of total
income or loss of assessee. The impugned notice dated 27th
August, 2022 has been issued by respondent no. 1 (JAO) and
not by the NFAC, which is not in accordance with the aforesaid
Scheme.
33. The guideline dated 1st August 2022 relied upon by the Revenue
is not applicable because these guidelines are internal guidelines as is
clear from the endorsement on the first page of the guideline –
“Confidential For Departmental Circulation Only”. The said guidelines
are not issued under section 119 of the Act. Any such guideline issued
by the CBDT is not binding on petitioner. Further the said guideline is
also not binding on respondent no. 1 as they are contrary to the
provisions of the Act and the Scheme framed under section 151A of
the Act. The effect of a guideline came up for discussion in Sofitel
Realty LLP v. ITO (TDS) [2023] 153 taxmann.com 496/294 Taxman
766/457 ITR 18 (Bom.) wherein this Court has held that the
guidelines which are contrary to the provisions of the Act cannot be
relied upon by the Revenue to reject an application for compounding
filed by an assessee. The Court held that guidelines are subordinate to
the principal Act or Rules, it cannot restrict or override the application
of specific provisions enacted by legislature. The guidelines cannot
travel beyond the scope of the powers conferred by the Act or the
Rules.
The guidelines do not deal with or even refer to the Scheme dated
29th March 2022 framed by the Government under section 151A of
the Act. Section 151A(3) of the Act provides that the Scheme so(Downloaded on 11/08/2025 at 07:03:16 PM)
[2025:RJ-JP:29991-DB] (16 of 22) [CW-10540/2024]framed is required to be laid before each House of the Parliament.
Therefore, the Scheme dated 29th March 2022 under section 151A of
the Act, which has also been laid before the Parliament, would be
binding on the Revenue and the guideline dated 1st August 2022
cannot supersede the Scheme and if it provides anything to the
contrary to the said Scheme, then the same is required to be treated
as invalid and bad in law.
34. As regards ITBA step-by-step Document No. 2 regarding issuance
of notice under section 148 of the Act, relied upon by Revenue, an
internal document cannot depart from the explicit statutory provisions
of, or supersede the Scheme framed by the Government under
section 151A of the Act which Scheme is also placed before both the
Houses of Parliament as per Section 151A(3) of the Act. This is
specially the case when the document does not even consider or even
refer to the Scheme. Further the said document is clearly intended to
be a manual/guide as to how to use the Income-tax Department’s
portal, and does not even claim to be a statement of the Revenue’s
position/stand on the issue in question. Our observations with respect
to the guidelines dated 1st August 2022 relied upon by the Revenue
will equally be applicable here.
35. Further, in our view, there is no question of concurrent
jurisdiction of the JAO and the FAO for issuance of notice under
section 148 of the Act or even for passing assessment or
reassessment order. When specific jurisdiction has been assigned to
either the JAO or the FAO in the Scheme dated 29th March, 2022,
then it is to the exclusion of the other. To take any other view in the
matter, would not only result in chaos but also render the whole
faceless proceedings redundant. If the argument of Revenue is to be
accepted, then even when notices are issued by the FAO, it would be
open to an assessee to make submission before the JAO and vice
versa, which is clearly not contemplated in the Act. Therefore, there is
no question of concurrent jurisdiction of both FAO or the JAO with
respect to the issuance of notice under section 148 of the Act. The
Scheme dated 29th March 2022 in paragraph 3 clearly provides that
the issuance of notice “shall be through automated allocation” which
means that the same is mandatory and is required to be followed by
the Department and does not give any discretion to the Department
to choose whether to follow it or not. That automated allocation is
defined in paragraph 2(b) of the Scheme to mean an algorithm for
randomised allocation of cases by using suitable technological tools
including artificial intelligence and machine learning with a view to
optimise the use of resources. Therefore, it means that the case can
be allocated randomly to any officer who would then have jurisdiction
to issue the notice under section 148 of the Act. It is not the case of
respondent no. 1 that respondent no. 1 was the random officer who
had been allocated jurisdiction.
36. With respect to the arguments of the Revenue, i.e., the
notification dated 29th March 2022 provides that the Scheme so
framed is applicable only ‘to the extent’ provided in Section 144B of
the Act and Section 144B of the Act does not refer to issuance of
notice under section 148 of the Act and hence, the notice cannot be
issued by the FAO as per the said Scheme, we express our view as
follows:-
Section 151A of the Act itself contemplates formulation of Scheme for
both assessment, reassessment or recomputation under section 147
as well as for issuance of notice under section 148 of the Act.
Therefore, the Scheme framed by the CBDT, which covers both the
aforesaid aspect of the provisions of Section 151A of the Act cannot
be said to be applicable only for one aspect, i.e., proceedings post the
issue of notice under section 148 of the Act being assessment,(Downloaded on 11/08/2025 at 07:03:16 PM)
[2025:RJ-JP:29991-DB] (17 of 22) [CW-10540/2024]reassessment or recomputation under section 147 of the Act and
inapplicable to the issuance of notice under section 148 of the Act.
The Scheme is clearly applicable for issuance of notice under section
148 of the Act and accordingly, it is only the FAO which can issue the
notice under section 148 of the Act and not the JAO. The argument
advanced by respondent would render clause 3(b) of the Scheme
otiose and to be ignored or contravened, as according to respondent,
even though the Scheme specifically provides for issuance of notice
under section 148 of the Act in a faceless manner, no notice is
required to be issued under section 148 of the Act in a faceless
manner. In such a situation, not only clause 3(b) but also the first two
lines below clause 3(b) would be otiose, as it deals with the aspect of
issuance of notice under section 148 of the Act. Respondents, being
an authority subordinate to the CBDT, cannot argue that the Scheme
framed by the CBDT, and which has been laid before both House of
Parliament is partly otiose and inapplicable. The argument advanced
by respondent expressly makes clause 3(b) otiose and impliedly
makes the whole Scheme otiose. If clause 3(b) of the Scheme is not
applicable, then only clause 3(a) of the Scheme remains. What is
covered in clause 3(a) of the Scheme is already provided in Section
144B(1) of the Act, which Section provides for faceless assessment,
and covers assessment, reassessment or recomputation under section
147 of the Act. Therefore, if Revenue’s arguments are to be accepted,
there is no purpose of framing a Scheme only for clause 3(a) which is
in any event already covered under faceless assessment regime in
Section 144B of the Act. The argument of respondent, therefore,
renders the whole Scheme redundant. An argument which renders the
whole Scheme otiose cannot be accepted as correct interpretation of
the Scheme. The phrase “to the extent provided in Section 144B of
the Act” in the Scheme is with reference to only making assessment
or reassessment or total income or loss of assessee. Therefore, for the
purposes of making assessment or reassessment, the provisions of
Section 144B of the Act would be applicable as no such manner for
reassessment is separately provided in the Scheme. For issuing
notice, the term “to the extent provided in Section 144B of the Act” is
not relevant. The Scheme provides that the notice under section 148
of the Act, shall be issued through automated allocation, in
accordance with risk management strategy formulated by the Board
as referred to in Section 148 of the Act and in a faceless manner.
Therefore, “to the extent provided in Section 144B of the Act” does
not go with issuance of notice and is applicable only with reference to
assessment or reassessment. The phrase “to the extent provided in
Section 144B of the Act” would mean that the restriction provided in
Section 144B of the Act, such as keeping the International Tax
Jurisdiction or Central Circle Jurisdiction out of the ambit of Section
144B of the Act would also apply under the Scheme. Further the
exceptions provided in sub-section (7) and (8) of Section 144B of the
Act would also be applicable to the Scheme.
37. When an authority acts contrary to law, the said act of the
Authority is required to be quashed and set aside as invalid and bad in
law and the person seeking to quash such an action is not required to
establish prejudice from the said Act. An act which is done by an
authority contrary to the provisions of the statue, itself causes
prejudice to assessee. All assessees are entitled to be assessed as per
law and by following the procedure prescribed by law. Therefore,
when the Income-tax Authority proposes to take action against an
assessee without following the due process of law, the said action
itself results in a prejudice to assessee. Therefore, there is no
question of petitioner having to prove further prejudice before arguing
the invalidity of the notice.
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38. With respect to the Office Memorandum dated 20th February
2023, the said Office Memorandum merely contains the comments of
the Revenue issued with the approval of Member (L&S) CBDT and the
said Office Memorandum is not in the nature of a guideline or
instruction issued under section 119 of the Act so as to have any
binding effect on the Revenue. Moreover, the arguments advanced by
the Revenue on the said Office Memorandum dated 20th February
2023 is clearly contrary to the provisions of the Act as well as the
Scheme dated 29th March 2022 and the same are dealt with as
under –
(i) It is erroneously stated in paragraph 3 of the Office
Memorandum that “The scheme clearly lays down that the
issuance of notice under section 148 of the Act has to be
through automation in accordance with the risk
management strategy referred to in section 148 of the Act.”
The issuance of notice is not through automation but
through “automated allocation”. The term “automated
allocation” is defined in clause 2(1)(b) of the said Scheme to
mean random allocation of cases to Assessing Officers.
Therefore, it is clear that the Assessing Officer are randomly
selected to handle a case and it is not merely a case where
notice is sought to be issued through automation.
(ii) It is further erroneously stated in paragraph 3 of the
Office Memorandum that “To this end, as provided in the
section 148 of the Act, the Directorate of Systems randomly
selects a number of cases based on the criteria of Risk
Management Strategy.” The term ‘randomly’ is further used
at numerous other places in the Office Memorandum with
respect to selection of cases for consideration/issuance of
notice under section 148 of the Act. Respondent is clearly
incorrect in its understanding of the said Scheme as the
reference to random in the said Scheme is reference to
selection of Assessing Officer at random and not selection of
Section 148 cases as random. If the cases for issuance of
notice under section 148 of the Act are selected based on
criteria of the risk management strategy, then, obviously,
the same are not randomly selected. The term ‘randomly’ by
definition mean something which is chosen by chance rather
than according to a plan. Therefore, if the cases are chosen
based on risk management strategy, they certainly cannot
be said to be random. The Computer/System cannot select
cases on random but selection can be based on certain well-
defined criteria. Hence, the argument of respondents is
clearly unsustainable. If the case of respondent is that the
applicability of Section 148 of the Act is on random basis,
then the provision of Section 148 itself would become
contrary to Article 14 of the Constitution of India as being
arbitrary and unreasonable. Randomly selecting cases for
reopening without there being any basis or criteria would
mean that the section is applied by the Revenue in an
arbitrary and unreasonable manner. The word ‘random’ is
used in clause 2(1)(b) of the said Scheme in the definition of
“automated allocation”. “Automated allocation” is defined in
the said clause to mean “an algorithm for randomised
allocation of cases….”. The term ‘random’, in our view, has
been used in the context of assigning the case to a random
Assessing Officer, i.e., an Assessing Officer would be
randomly chosen by the system to handle a particular case.
The term ‘random’ is not used for selection of case for
issuance of notice under section 148 as has been alleged by
the Revenue in the Office Memorandum. Further, in
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[2025:RJ-JP:29991-DB] (19 of 22) [CW-10540/2024]
paragraph 3.2 of the Office Memorandum, with respect to
the reassessment proceedings, the reference to ‘random
allocation’ has correctly been made as random allocation of
cases to the Assessment Units by the National Faceless
Assessment Centre. When random allocation is with
reference to officer for reassessment then the same would
equally apply for issuance of notice under section 148 of the
Act.
(iii) The conclusion at the bottom of page 2 in paragraph 3
of the Office Memorandum that “Therefore, as provided in
the scheme the notice under section 148 of the Act is issued
on automated allocation of cases to the Assessing Officer
based on the risk management criteria” is also factually
incorrect and on the basis of incorrect interpretation of the
Scheme. Clause 2(1)(b) of the Scheme defined ‘automated
allocation’ to mean ‘an algorithm for randomised allocation
of cases by using suitable technological tools, including
artificial intelligence and machine learning, with a view to
optimise the use of resources’. The said definition does not
provide that the automated allocation of case to the
Assessing Officer is based on the risk management criteria.
The reference to risk management criteria in clause 3 of the
Scheme is to the effect that the notice under section 148 of
the Act should be in accordance with the risk management
strategy formulated by the board which is in accordance
with Explanation 1 to Section 148 of the Act. In our view,
the Revenue is misinterpreting the Scheme, perhaps to
cover its deficiency of not following the Scheme for issuing
notice under section 148 of the Act.
(iv) In paragraph 3.1 of the Office Memorandum, it is stated
that the case is selected prior to issuance of notice are
decided on the basis of an algorithm as per risk
management strategy and are, therefore, randomly
selected. It is further stated that these cases are ‘flagged’ to
the JAO by the Directorate of Systems and the JAO does not
have any control over the process. It is further stated that
the JAO has no way of predicting or determining beforehand
whether the case will be ‘flagged’ by the system. The
contention of the Revenue is that only cases which are
‘flagged’ by the system as per the risk management strategy
formulated by CBDT can be considered by the Assessing
Officer for reopening, however, in clause (i) in the
Explanation 1 to Section 148 of the Act, the term “flagged”
has been deleted by the Finance Act, 2022, with effect from
1st April 2022. In any case, whether only cases which are
flagged can be reopened or not is not relevant to decide the
scope of the Scheme framed under section 151A of the Act,
which required the notice under section 148 of the Act to be
issued on the basis of random allocation and in a faceless
manner.
(v) The Revenue has wrongly contended in paragraph 3.1
of the Office Memorandum that “Therefore, whether JAO or
NFAC should issue such notice is decided by administration
keeping in mind the end result of natural justice to the
assessees as well as completion of required procedure in a
reasonable time.” In our opinion, there is no such power
given to the administration under either Section 151A of the
Act or under the said Scheme. The Scheme is clear and
categorical that notice under section 148 of the Act shall be
issued through automated allocation and in a faceless
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[2025:RJ-JP:29991-DB] (20 of 22) [CW-10540/2024]
manner. Therefore, the argument of the Revenue is clearly
contrary to the provisions of the Scheme.
(vi) In paragraph 3.3 of the Office Memorandum, it is again
erroneously stated that “Here it is pertinent to note that the
said notification does not state whether the notices to be
issued by the NFAC or the Jurisdictional Assessing Officer
(“JAO”)…… It states that issuance of notice under section
148 of the Act shall be through automated allocation in
accordance with the risk management strategy and that the
assessment shall be in faceless manner to the extent
provided in section 144B of the Act.” The Scheme is
categoric as stated aforesaid that the notice under section
148 of the Act shall be issued through automated allocation
and in a faceless manner. The Scheme clearly provides that
the notice under section 148 of the Act is required to be
issued by NFAC and not the JAO. Further, unlike as
canvassed by Revenue that only the assessment shall be in
faceless manner, the Scheme is very clear that both the
issuance of notice and assessment shall be in faceless
manner.
(vii) In paragraph 5 of the Office Memorandum, a
completely unsustainable and illogical submission has been
made that Section 151A of the Act takes into account that
procedures may be modified under the Act or laid out taking
into account the technological feasibility at the time.
Reading the said Scheme along with Section 151A of the Act
makes it clear that neither the Section or the Scheme speak
about the detailed specifics of the procedure to be followed
therein. This argument of the Revenue is clearly contrary to
the Scheme as the Scheme is very specific to provide, inter
alia, that the issuance of notice under section 148 of the Act
shall be through automated location and in a faceless
manner. Therefore, the Scheme is mandatory and provides
the specification as to how the notice has to be issued.
Further the argument of the Revenue that Section 151A of
the Act takes into account that the procedure may be
modified under the Act is without appreciating that if the
procedure is required to be modified then the same would
require modification of the notified Scheme. It is not open to
the Revenue to refuse to follow the Scheme as the Scheme
is clearly mandatory and is required to be followed by all
Assessing Officers.
(viii) The argument of the Revenue in paragraph 5.1 of the
Office Memorandum that the Section and Scheme have left
it to the administration to device and modify procedures
with time while remaining confined to the principles laid
down in the said Section and Scheme, is without
appreciating that one of the main principles laid down in the
Scheme is that the notice under section 148 of the Act is
required to be issued through automated allocation and in a
faceless manner. There is no leeway given on the said
aspect and, therefore, there is no question of the
administration to device and modify procedures with respect
to the issuance of notice.
39. With reference to the decision of the Hon’ble Calcutta High Court
in Triton Overseas (P.) Ltd. (supra), the Hon’ble Calcutta High Court
has passed the order without considering the Scheme dated 29th
March 2022 as the said Scheme is not referred to in the order.
Therefore, the said judgment cannot be treated as a precedent or
relied upon to decide the jurisdiction of the Assessing Officer to issue
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[2025:RJ-JP:29991-DB] (21 of 22) [CW-10540/2024]
notice under section 148 of the Act. The Hon’ble Calcutta High Court
has referred to an Office Memorandum dated 20th February 2023
being F No. 370153/7/2023 TPL which has been dealt with above.
Therefore, no reliance can be placed on the said Office Memorandum
to justify that the JAO has jurisdiction to issue notice under section
148 of the Act. Further the Hon’ble Telangana High Court in the case
of Kankanala Ravindra Reddy v. ITO [2023] 156 taxmann.com
178/295 Taxman 652 (Telangana) has held that in view of the
provisions of Section 151A of the Act read with the Scheme dated
29th March 2022 the notices issued by the JAOs are invalid and bad in
law. We are also of the same view.”
16. In fact, Mr. Bapna’s submissions on this aspect were similar
to the submissions made by the Revenue in Hexaware
Technologies Ltd. (supra).
17. Therefore, on this ground also, we will have to hold that
notice dated 1st May 2024 is invalid and bad in law being issued
by JAO as the same was not in accordance with Section 151A of
the Act.
18. We should also note that the decision in Hexaware
Technologies Ltd. (supra) has been followed by Division Bench
of this Court in the case of Sharda Devi Chhajer Vs. The
Income Tax Officer & Another3.
19. In fact, Bombay High Court in the cases of Abhin
Anilkumar Shah Vs. Income Tax Officer 4 as also Bmc
Software India (P) Ltd. v. Deputy Commissioner of
Income-tax5 has followed the decision in Hexaware
Technologies Ltd. (supra) and held that notice under Section
148 of the Act issued by JAO and not FAO will not be in
accordance with Section 151A of the Act and hence invalid.
20. In view of above, we do not think that at this stage, it is
necessary to answer other points raised by petitioner and
opposed by respondents. On two issues dealt with above, i.e.,
3 2025 SCC OnLine Raj 3386
4 2024 SCC OnLine Bom 2835
5 [2024] 167 taxmann.com 39 (Bombay)
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[2025:RJ-JP:29991-DB] (22 of 22) [CW-10540/2024]
limitation and issuance of notice by JAO itself being held against
the Revenue, we, hereby, quash and set aside notice dated 1st
May 2024. Order dated 1st May 2024 is also quashed and set
aside.
21. At this stage, Mr. Siddharth Bapna, counsel states that
judgment of the Bombay High in Hexaware Technologies Ltd.
(supra) is challenged by Revenue before the Hon’ble Apex Court
and notice has been issued. Mr. Siddharth Bapna states that if the
Hon’ble Apex Court sets aside the law as laid down in Hexaware
Technologies Ltd. (supra), Revenue should be allowed to revive
the notice. Certainly, Revenue can make that request to the
Hon’ble Apex Court.
22. Petition allowed.
(ANAND SHARMA),J (K.R. SHRIRAM),CJ
MANOJ NARWANI-DAKSH /1(F)
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