Srikanth Kakati Vs ITO (ITAT Hyderabad)
ITAT Hyderabad Quashes Reassessment: 148/148A Notices Issued by JAO Void for Breach of Faceless Regime
The Hyderabad ‘B’ Bench of the ITAT, in Srikanth Kakati vs. ITO, Ward-1, Kothagudem (ITA No. 1341/Hyd/2025, AY 2018-19), vide order dated 24-12-2025, allowed the assessee’s appeal by quashing the entire reassessment proceedings on jurisdictional grounds.
The Tribunal condoned a 25-day delay in filing the appeal, taking a liberal view in the interest of substantial justice. It also admitted an additional legal ground challenging the very assumption of jurisdiction by the Jurisdictional Assessing Officer (JAO) in issuing notice u/s 148A(b), order u/s 148A(d) and notice u/s 148.
On merits of the legal issue, the Tribunal held that the reassessment proceedings initiated by the JAO, instead of the National Faceless Assessment Centre (NFAC), were contrary to Section 144B read with Section 151A and CBDT Notification No. 18/2022 dated 29-03-2022. Relying heavily on the binding judgment of the Telangana High Court in Kankanala Ravindra Reddy and a catena of High Court decisions (including Hexaware Technologies Ltd.), the Tribunal held that notices issued outside the faceless framework are invalid and void ab initio.
Since the very jurisdiction to reopen was defective, the notice u/s 148A(b), the order u/s 148A(d), and the consequential notice u/s 148 dated 29-04-2022 were quashed, which in turn vitiated the reassessment order passed u/s 147 r/w 148 r/w 144B. All additions made towards unexplained money, unexplained investment and other income were therefore not adjudicated on merits and kept open.
Considering that the issue is pending before the Supreme Court in the Department’s SLP in Hexaware Technologies, the Tribunal granted liberty to both parties to seek revival of the appeal depending on the outcome of the Supreme Court’s decision.
Accordingly, the appeal of the assessee was allowed on jurisdictional grounds
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
