Best judgment reassessment can be remanded under amended appellate powers when the assessment falls within section 144.

A best judgment reassessment framed after repeated non-compliance with notices under section 142(1) and a show-cause notice under section 144 retained the character of an order under section 144, even though the faceless assessment procedure under section 144B applied. The amended proviso to section 251(1)(a), inserted by the Finance Act, 2024, empowers the first appellate authority to set aside and restore such section 144 matters for fresh assessment. On that basis, and in light of additional material before the appellate authority, the remand was treated as within jurisdiction and the Revenue's challenge failed.

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Issues: Whether the first appellate authority could, in an appeal against a best judgment reassessment made under the faceless assessment regime, set aside the matter and remand it for fresh assessment instead of deciding the appeal on merits.

Analysis: The reassessment had been framed after repeated non-compliance by the assessee with notices issued under section 142(1) and the subsequent show-cause notice under section 144, and the assessment was thus in the nature of a best judgment assessment. The faceless procedure under section 144B governed the reassessment process, but it did not take away the character of the order as one passed under section 144. The proviso inserted to section 251(1)(a) by the Finance Act, 2024, with effect from 01.10.2024, empowers the first appellate authority to set aside and restore matters arising from an assessment under section 144 for fresh assessment. In view of that amended appellate power, and considering the additional material placed before the appellate authority, the remand was held to be within jurisdiction.

Conclusion: The first appellate authority was competent to set aside the best judgment reassessment and remand the matter for fresh assessment; the Revenue's challenge failed.

Ratio Decidendi: Where an appeal arises from a best judgment assessment under section 144, the first appellate authority may exercise the amended power under section 251(1)(a) to set aside and remand the matter for fresh assessment.

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