Ramesh Sistla Vs ITO (ITAT Hyderabad)
Reassessment Proceedings Collapse as ITAT Emphasizes Mandatory Faceless Regime – Jurisdictional AO Has No Power After CBDT Notification
Hyderabad ITAT delivered a detailed & significant ruling on the legality of reassessment proceedings post-29.03.2022.
Assessee had not filed a return u/s 139. Based on information about substantial bank deposits, AO issued a notice u/s 148A(b) on 23.03.2022 (pre-notification). However, on 07.04.2022, the order u/s 148A(d) & subsequently the notice u/s 148 were both issued by the Jurisdictional Assessing Officer (JAO). After partial compliance, AO completed reassessment u/s 147 r.w.s. 144B on 20.12.2023, making massive additions: ₹92,75,690 u/s 69A (cash deposits), & ₹12,08,10,000 u/s 68 (bank credits), & taxed the same u/s 115BBE.
Assessee appealed before CIT(A), but due to repeated adjournments, the appeal was dismissed ex-parte for non-prosecution. In the Tribunal, Assessee pressed only one pure legal ground: that the notice u/s 148 was invalid since, after CBDT Notification No.18/2022 dated B issued u/s 151A, only the Faceless Assessing Officer (FAO) could issue notices u/s 148. The JAO had no jurisdiction after that date.
Assessee supported this with:
- The actual notices showing the name/designation of JAO
- Telangana High Court judgments holding such notices invalid
- Coordinate Bench (ITAT Hyderabad) decision in Kotha Kanthaiah, quashing identical notices, including in Assessee’s own earlier AY 2016-17.
Department argued that the issue was pending before the Supreme Court in Hexaware Technologies (SLP) & requested the ITAT to keep it open.
