Procedural non-compliance: Reassessment notices issued under sections 148 and 148A declared invalid by Bombay HC
High Court of Bombay in its recent ruling has held that the faceless Reassessment Notices are invalid due to procedural non-compliance. It was held in the case of Sahib Singh Agencies (Bombay) (P.) Ltd. v. Deputy Commissioner of Income-tax.
Let us have a short overview of the overall case & observation thereto:
1. Non-Compliance with Faceless Assessment:
Notices were issued by the Jurisdictional Assessing Officer (JAO) instead of the required Faceless Assessing Officer (FAO), violating Section 151A and the faceless mechanism. This procedural error rendered the notices invalid.
2. Strict Adherence to Section 151A:
All reassessment procedures must follow the faceless assessment framework to ensure transparency and procedural integrity. Deviations from this process undermine the intended reforms.
3. Resolution of Condonation Requests:
The court ordered that the pending application for condonation of delay in filing the return and tax audit report for the assessment year 2020-2021 be decided promptly, as it had been unduly delayed.
4. Consistency with Legal Precedents:
This decision aligns with earlier rulings, such as Hexaware Technologies Limited v. Assistant Commissioner of Income Tax and Nainraj Enterprises Pvt. Ltd. v. The Deputy Commissioner of Income Tax, reinforcing the need for compliance with faceless assessment guidelines.
The ruling carries high relevance for the taxpayers and professionals. It must be ensured that the reassessment notices are issued by the correct Faceless Assessing Officer to avoid invalidation and procedural issues.
The copy of the order is as under:
