Case Law Details
Shyam Sundar Saw Vs Union of India (Jharkhand High Court)
Summary:The Jharkhand High Court considered a petition challenging proceedings initiated under Sections 148 and 148A of the Income Tax Act, including the show-cause notice dated 24 March 2025, order dated 24 June 2025, and notice dated 24 June 2025. The petitioner contended that, after the introduction of the e-Assessment Faceless Scheme under Section 151A through notification dated 29 March 2022, such proceedings conducted otherwise were without jurisdiction. The petition had remained pending because certain High Courts had accepted similar contentions and the issue was pending before the Supreme Court.
During pendency of the matter, Clause 9 of the Finance Act, 2026 inserted Section 147A into the Income Tax Act with retrospective effect from 1 April 2021. Section 147A clarified that, notwithstanding any judgment, order, decree, Section 151A, or any scheme framed thereunder, the “Assessing Officer” for purposes of Sections 148 and 148A would mean an Assessing Officer other than the National Faceless Assessment Centre or any assessment unit referred to in Section 144B(3).
The High Court held that, because of the retrospective insertion of Section 147A, the challenge to the reassessment proceedings and notices on the ground of lack of jurisdiction would no longer survive. Accordingly, the Court disposed of the petition without interfering with the impugned notices and proceedings. However, liberty was granted to the petitioner to raise all permissible objections during reassessment proceedings and also to challenge any adverse reassessment order or the validity and retrospectivity of Section 147A in accordance with law. The interim order, if any, was vacated and no costs were awarded.
FULL TEXT OF THE JUDGMENT/ORDER OF JHARKHAND HIGH COURT
1. Heard learned counsel for the parties.
2. The challenge in this petition is to the proceedings under Sections 148 and 148A of the Income Tax Act including show-cause notice dated 24th March, 2025 (Annexure-1), order dated 24th June, 2025 (Annexure-5) and notice dated 24th June, 2025 (Annexure-5/1) on the ground that such proceedings and notices, after the introduction of the e-Assessment Faceless Scheme under Section 1 151A of the Income Tax Act vide notification dated 29th March, 2022 (Annexure-7) would be without jurisdiction.
3. Since some High Courts had taken the view that supported the petitioner’s contention, and the matter was pending before the Hon’ble Supreme Court, this petition was also kept pending.
4. However, by Clause 9 of the Finance Act, 2026, a new Section 147A has been inserted after Section 147 of the Income Tax Act, and the same was deemed to have been inserted with effect from 1st day of April, 2021.
5. Clause 9 of the Finance Act, 2026 reads as follows:-
“9. After section 147 of the Income-tax Act, the following section shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2021, namely:-
“147A. Notwithstanding anything contained in any judgment, order or decree of any court or in section 151A or in any scheme framed thereunder, for the removal of doubts, it is hereby clarified that the Assessing Officer for the purposes of sections 148 and 148A shall mean and shall always be deemed to have meant to be an Assessing Officer other than the National Faceless Assessment Centre or any assessment unit referred to in sub-section (3) of section 144B.”
6. Section 147A provides that notwithstanding anything contained in any judgment, order or decree of any court or in section 151A or in any scheme framed thereunder, for the removal of doubts, it is hereby clarified that the Assessing Officer for the purposes of sections 148 and 148A shall mean and shall always be deemed to have meant to be an Assessing Officer other than the National Faceless Assessment Centre or any assessment unit referred to under sub-section (3) of section 144B.
7. With the above retrospective insertion of Section 147A in the I.T. Act, the challenge to the entire proceedings and the impugned notices as being without jurisdiction would no longer survive.
8. Accordingly, by taking cognisance of the above amendment/insertion, we dispose of this petition without interfering with the impugned notices and the proceedings based on them. However, we clarify that the petitioner would be at liberty to raise all permissible grounds and objections in the reassessment proceedings pursuant to the impugned notices, and such grounds and objections will be considered in accordance with law and on their own merits.
9. Further, if any adverse orders are made on the conclusion of the re-assessment proceedings and the petitioner, inter alia, desires to challenge such orders or the provisions of Section 147A or the retrospectivity granted thereto, the petitioner will have liberty to do so in accordance with law.
10. With the above liberties, we dispose of this petition.
11. Interim order, if any, is hereby vacated.
12. No costs.
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