PCIT Vs Tayal Sons Private Limited (Punjab and Haryana High Court)
Summary: The Punjab and Haryana High Court dismissed Revenue’s appeal against the ITAT’s decision quashing the notice dated 27.03.2023 issued under Section 148 by the Jurisdictional Assessing Officer (JAO). Revenue raised ten proposed substantial questions of law concerning the distinction between issuance of notices in a “faceless manner” under the e-Assessment of Income Escaping Assessment Scheme, 2022 and the faceless assessment procedure under Section 144B. It contended that Section 144B operated after issuance of the Section 148 notice and filing of the return, that the JAO retained the power to issue reassessment notices, and that automated allocation and the Faceless Jurisdiction of Income-tax Authorities Scheme, 2022 supported the JAO’s jurisdiction. Revenue also invoked the Calcutta High Court’s decision in Triton Overseas Pvt. Ltd. to support its contention that the JAO and units under NaFAC possessed concurrent jurisdiction. The appeal further questioned whether Section 151A, read with Section 144B and CBDT Notification No. 18/2022 dated 29.03.2022, required notices under Section 148 to be issued exclusively through the faceless mechanism. The High Court recorded that it was undisputed that all these questions had already been answered against Revenue in Jyoti Sareen Vs Union of India and others, CWP No. 15791 of 2024, decided on 10.09.2026. Accordingly, it dismissed the appeal by following that decision, leaving the Tribunal’s quashing of the notice undisturbed.
Cases Discussed
- Jyoti Sareen Vs Union of India and others, CWP No. 15791 of 2024, judgment dated 10.09.2026 (Punjab and Haryana High Court). Followed because all the questions raised by Revenue had already been answered against it in this decision.
- Triton Overseas Pvt. Ltd. Vs Union of India and others, WPO No. 1566 of 2023, order dated 13.09.2023 (Calcutta High Court). Cited by Revenue in its proposed substantial question of law to support concurrent jurisdiction of the JAO and units under NaFAC. The supplied order does not separately examine this decision; it dismisses the appeal by following Jyoti Sareen.
FULL TEXT OF THE JUDGMENT/ORDER OF PUNJAB AND HARYANA HIGH COURT
1. Through this appeal, the revenue raises the following substantial questions of law:-
“(a) Whether the Hon’ble ITAT has misinterpreted the term ‘Faceless Manner’ in Assessment of Income Escaping Assessment Scheme, 2022 with ‘Faceless Assessment’ procedure whose application is advent upon filing of return of income upon notice under Section 148 as provided in sub-section (1)(iii) (b) of Section144B w.r.t issuance of notice of Section 148 by Faceless Assessing Officer(FAO)?
(b) Whether the Hon’ble ITAT has misinterpreted the term ‘Faceless Manner in E-Assessment of Income Escaping Assessment Scheme, 2022 solely without considering to the extent provided in Section 144B of the Act in relation to the Explanation of Section 144B of the Act?
(c) Whether the Hon’ble ITAT has wrong interrelated the intention of the legislature w.r.t. the term ‘Faceless Manner’ in E- Assessment of Income Escaping Assessment Scheme, 2022 vis-a- vis ‘Faceless Assessment’ procedure whose application is advent upon filing of return of income upon notice under Section 148 as (iii)(b) of Section 144B w.r.t. issuance of notice of Section 148 by Faceless Assessing Officer (FAO)?
(d) Whether the Hon’ble ITAT has taken into the consideration the automatic allocation of Assessee to the Jurisdictional Assessing Officers in accordance with and to the extent provided of the schemes as defined in Faceless Jurisdiction of Income tax Authorities Scheme, 2022, which confers jurisdiction to the Jurisdictional Assessing Officer and hence the Jurisdictional Assessing Officer issued notice in the case as per E-Assessment of Income Assessment Scheme, 2022?
(e) Whether on the facts and circumstances of the case and in law the Hon’ble ITAT is justified in setting aside set aside notice under Section148 dated 27.03.2023 issued/ passed by the Jurisdictional Officer (JAO), given that the Finance Act, 2021 introduced provisions for faceless assessment and the automated allocation of cases, and does not explicitly prohibit the JAO from issuing such notices?
(f) Whether the Hon’ble ITAT, while quashing the notice issued under Section 148 by the Jurisdictional Assessing Officer JAO), failed to appreciate that the same is consistent with the legislative intent. when the powers to issue the notice under Section 148 remained intact with the JAO even after bringing the ‘Faceless Assessment Scheme?
(g) Whether on the facts and circumstances of the case and in law, the Hon’ble ITAT is correct in holding that JAO cannot issue notice under Section 148 of the Act, when both the JAO as well as units under NaFAC have concurrent jurisdiction under the Income Tax Act as has been held by the Hon’ble Kolkata High Court in its order in W.P. No. WPO/ 1566/2023 dated 13.09.2023 in the case of Triton Overseas Pvt. Ltd.?
(h) Whether the Hon’ble ITAT’s decision to quash the notice issued under Section 148 by the Jurisdictional Assessing Officer (JAO) is in alignment with the provisions of Section 144B which comes into picture only after the process of issuance of notice under Section 148 of the Act has been completed?
(i) Whether on the facts and circumstances of the case and in law, the Hon’ble ITAT is justified in quashing the notice issued under Section 148 by the JAO as per automated management allocation and risk strategies as per provisions of Section 151A read with Section 144B of the Income Tax Act?
(j) Whether the Hon’ble ITAT is correct in law in holding that the Section 144B, 151A of the Income Act, r/w CBDT Notification No.18/2022 dated 29.03.2022 mandate that the notice under Section 148 shall only by Faceless, when the provisions of 148 of the Act require issue of notices by Assessing Officers?”
2. It is not disputed that through a recent judgment of this Court dated 10.09.2026 in CWP No.15791 of 2024 – Jyoti Sareen Vs. Union of India and others, all the afore questions have been answered against the revenue.
3. In the light of the above consensus, this appeal is dismissed in the light of the law laid down in Jyoti Sareen’s case (supra).
