No Escape from Reassessment – Faceless or Not, Reassessment Stands- HC Dismisses Challenge on JAO vs FAO- Delhi HC-Jurisdictional AO Can Still Issue Reassessment Notices Despite Faceless Scheme
Summary: The Delhi High Court has ruled that a Jurisdictional Assessing Officer (JAO) can validly initiate reassessment proceedings, despite the introduction of the faceless assessment scheme. In the case of All India Kataria Education Society Vs DCIT, Delhi High Court, the petitioner challenged the reassessment, arguing that only a Faceless Assessing Officer (FAO) had jurisdiction. The court dismissed this argument, citing its own consistent precedents, including TKS Builders Pvt. Ltd. v. ITO and PC Jeweller Ltd. v. ACIT, which have established that the faceless scheme does not completely remove the JAO’s authority. The court acknowledged that a conflict exists among High Courts on this matter, with the Bombay and Madras High Courts holding that only FAOs have jurisdiction, while the Delhi and Calcutta High Courts have supported concurrent jurisdiction. The Delhi High Court upheld its position and allowed the reassessment to proceed, granting the petitioner the right to address other issues during the process. The core legal dispute is now pending before the Supreme Court.
Analysis
Delhi High Court dealt with a challenge to reassessment proceedings initiated u/s 147/148 . The petitioner questioned whether such proceedings could be validly initiated by the Jurisdictional Assessing Officer (JAO) after the CBDT notification of 29.03.2022 mandating faceless reassessments, arguing that only the Faceless Assessing Officer (FAO) had jurisdiction.
The Court noted that the issue was no longer res integra. It had already been decided in TKS Builders Pvt. Ltd. v. ITO, Ward 25(3), New Delhi (NC 2024:DHC:8330-DB), where it was held that reassessment proceedings could still be initiated by the JAO despite the faceless scheme notification. Further, in PC Jeweller Ltd. v. ACIT (W.P.(C) 13229/2024, decided on 23.01.2025), the same argument had been rejected by a coordinate Bench relying on TKS Builders. Though the Supreme Court has entertained an SLP in PC Jeweller Ltd. & stayed the operation of adverse orders, the Delhi High Court reaffirmed its earlier position. Additionally, in Mehak Jagga v. ITO (W.P.(C) 13149/2025, decided on 28.08.2025), the Court had reiterated the same principle & dismissed the challenge.
Relying on these precedents, the Bench dismissed the writ petition of the Society. The Court clarified that while the reassessment could proceed, the petitioner would be free to raise all other legal & factual issues before the Income Tax Authorities during the reassessment process.
Accordingly, the writ petition & pending applications were dismissed as infructuous.
AUTHOR’S VIEWS
The issue of whether reassessment notices u/s 147/148, post the CBDT Notification dt 29.03.2022 & insertion of Section 151A, can be issued by the Jurisdictional AO (JAO) or only by the Faceless AO/NFAC (FAO) has led to conflicting judicial opinions.
On one side, Bombay, Madras, Telangana, Gauhati, Punjab & Haryana, & Karnataka High Court have consistently held that once the Faceless Reassessment Scheme, 2022 was notified, reassessment must be conducted in a faceless manner only. Any notice issued by the JAO is procedurally invalid & without jurisdiction. These Courts have applied the settled principle that when the law mandates a thing to be done in a particular way, it must be done in that way alone.
In contrast, the Delhi High Court in T.K.S. Builders, PC Jeweller, Mehak Jagga & more recently All India Kataria Education Society has upheld the validity of JAO-issued notices, taking the view that JAO & FAO enjoy concurrent jurisdiction. This interpretation, however, arguably undermines the object of Section 151A & the very rationale of eliminating interface through the faceless regime.
The jurisprudential balance has now shifted further with the Supreme Court’s order in *ITO v. Prakash Pandurang Patil (SLP (C) Diary No. 39689/2025, order dated 18.08.2025), where the Apex Court dismissed the Revenue’s challenge to the Bombay HC ruling-not merely on limitation but also on merits. Though brief, this dismissal lends strong persuasive weight to the Bombay HC view that JAO notices post-29.03.2022 are without jurisdiction.
It is significant that most High Court rulings, including the Karnataka HC’s detailed judgment of 28.08.2025, were delivered without reference to this Supreme Court development. Going forward, the SC’s refusal to interfere with the Bombay HC approach will likely embolden other Courts to follow the pro-FAO line.
In the author’s view, the Delhi HC’s concurrent jurisdiction doctrine stands on increasingly shaky ground, both in the face of the statutory scheme & the Supreme Court’s tacit approval of the Bombay HC position. Until an authoritative pronouncement is rendered by the Apex Court in a reasoned judgment, taxpayers outside Delhi & Calcutta jurisdictions have a strong foundation to challenge JAO-issued reassessment notices as being ultra vires.
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