TaxTMI 
TaxTMI 
2026 (8) TMI 1177
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....ourt in the case of Collector Land Acquisition V Mst Katij & othrs (1987) 167 ITR 471(SC), we condone the delay. 3. Brief facts of the case are that the assessee is an individual and had not filed his return of income for A.Y. 2017-18 u/s 139(1) of the Act. The Jurisdictional Assessing Officer (JAO) received an information available on AIR, that the assessee has made cash payments for goods and services amounting to Rs. 9,31,600/- and has received rent amounting to Rs. 69,30,841/-. The JAO, after following the due procedure and obtaining prior approval, issued notice under section 148 of the Act dated 30.03.2021 which was duly served upon the assessee. The AO notes that the assessee did not file ITR In response the notice u/s 148 of the Act. Instead, the assessee filed his ITR for AY 2017-18 u/s 139(4) r.w.s 119(2)(b) declaring income of Rs 4,36,510/- on 15.04.2021. The return filed u/s 139(4) r.w.s. 119(2)(b) was ignored by the FAO while passing the assessment order u/s 147 r.w.s 144 r.w.s. 144B of the Act. 4. During the course of assessment proceedings, the JAO has issued notice under section 142(1) of the Act dated 15.11.2021 along with detailed show-cause notice. In respo....
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.... It is imperative to mention here that the assessment proceedings concluded under section 147 r.w.s 144 r.w.s 144B of the Income Tax Act, 1961 is invalid and beyond jurisdiction, as such proceeding along with assessment order passed u/s 147 r.w.s 144 r.w.s 144B of the Act in itself suffers from fundamental legal infirmities. The said proceedings were conducted beyond jurisdiction and without authority of law in absence of notification giving power for faceless assessments which was notified only on 29.03.2022 vide CBDT Notification No. 18/2022 [F. No. 370142/16/2022-TPL (Part 1)]. Further, it is to be submitted that section 151A of the Act, introduced by the Finance Act, 2020 with effect from 01.11.2020, lays down the framework for faceless assessment, reassessment, re-computation, issuance of notice under Section 148, and sanction under Section 151 of the Act where section 151A of the Act stating that: 151A. (1) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of assessment, reassessment or re-computation under section 147 or issuance of notice under section 148 or sanction for issue of such notice under secti....
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....ional Faceless Assessment Centre, Delhi 13.03.2022 SCN National Faceless Assessment Centre, Delhi 21.03.2022 147 r.w.s 144 r.w.s 144B of the Act National Faceless Assessment Centre, Delhi As can be seen from the above table, that the entire assessment proceedings was conducted under the scheme provided in Section 151A(1) of Income Tax Act, 1961 before issuance of notification dated 29.03.2022 which means such an assessment has been conducted in a manner which is beyond authority of law. It is a settled principle that a notification becomes operative only from the date of its issuance and is not retrospective unless expressly stated. Accordingly, the CBDT's notification dated 29.03.2022 applies only to proceedings initiated on or after 29.03.2022. Any proceedings prior to 29.03.2022 continue under the earlier regime, wherein NFAC had no jurisdiction to conduct reassessment proceedings under Section 147 of the Act. Thus, the reassessment framed by NFAC in the present proceeding is initiated, conducted and concluded before the operative date of the said notification, therefore, the assessment framed in the present case is prior....
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....axation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA), whereby Section 144B of the Act was introduced w.e.f 01.04.2021. The ld DR referred to CBDT's order u/s 119 of the Act dated 06.09.2021 and its amendment vide order dated 22.09.2021 wherein all assessment was directed to be conducted under the Faceless scheme. The ld DR also referred to the Finance Act, 2022 which amended section 144B to include assessments, reassessments or recomputation under Sections 143(3), 144 and 147 of the Act w.e.f. 01.04.2022. 8. We have heard the rival submissions and perused the material available on record. The legal challenge that is posed before us for adjudication of the validity of assessment order passed under section 147 r.w.s 144 r.w.s 144B of the Act dated 21.03.2022 by FAO, before the faceless scheme for reassessment became operational vide CBDT Notification No. 18/2022 dated 29.03.2022. The argument propounded is that since the impugned assessment proceeding u/s 147 in the instant case, was initiated under the scheme specified in sub-section (1) of section 151A of Income Tax Act, 1961 i.e in faceless manner much prior to the said notification dated 29.....
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....ion 144B w.e.f. 01.04.2022 is as under: Faceless Assessment. 144B. (1) Notwithstanding anything to the contrary contained in any other provision of this Act, the assessment, reassessment or recomputation under subsection (3) of section 143 or under section 144 or under section 147, as the case may be, with respect to the cases referred to in sub-section (2), shall be made in a faceless manner as per the following procedure, namely:- ********** 10. The hon'ble Delhi High Court in TKS Builders (supra), notes that the CBDT, post the commencement of the Faceless Assessment Scheme in 2019 issued one of its first instructions on 08.04.2021, followed by an order u/s 119 of the Act dated 06.09.2021 and amending order dated 22.09.2021 which chronicled various categories of cases which would stand excluded from faceless assessment. The CBDT's order u/s 119 of the Act dated 06.09.2021 is reproduced as under: F No. 187/3/2020-ITA-I Ministry of Finance Department of Revenue (Central Board of Direct Taxes) North Block, New Delhi Dated, the 6th September, 2021 ORDER Subject:- Order under section 119 of the Income-tax Act, 1961 (the Act) providing ex....
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....he Act vide the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. Section 144B of the Act pertaining to Faceless Assessment has been inserted by the said amendment w.e.f. 1-4-2021. 2. The Central Board of Direct Taxes vide Order F.No. 187/3/2020-ITA-I dated 13th August, 2020 (the Order) read with order under section 119 of the Act regarding mutatis mutandis application of Orders, Circulars etc. issued in order to implement the Scheme to Faceless Assessment under section 144B of the Act, F.No. 187/3/2020- ITA-I dated 31st March, 2021 directed that all the Assessment Orders shall be passed by the National Faceless Assessment Centre (NaFAC) under section 144B of the Act except as under:- i) Assessment orders in cases assigned to Central Charges ii) Assessment orders in cases assigned to International Tax Charges iii) assessment order in cases where pendency could not be created on ITBA portal because of technical reasons or cases not having a PAN, as the case may be. iv) Assessment orders in cases a) set aside to be done de novo or b) to be done u/s 147 of the act for which the time limit ....
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....aceless assessment itself conferred "concurrent" jurisdiction upon JAO as well as FAO to take up assessment proceedings. 14. Further, the legislature carried out the amendment vide Finance Act, 2026 which introduced a new Section 147A into the Income-tax Act, 1961, legally validating reassessment notices issued by JAOs instead of solely through the faceless mechanism with retrospective Effect from April 1, 2021 as follows: 147A. Notwithstanding anything contained in any judgment, order or decree of any court or in section 151A or in any scheme framed thereunder, for the removal of doubts, it is hereby clarified that the Assessing Officer for the purposes of sections 148 and 148A shall mean and shall always be deemed to have meant to be an Assessing Officer other than the National Faceless Assessment Centre or any assessment unit referred to in sub-section (3) of section 144B. 15. In such facts and circumstances, we are therefore of the considered view that a harmonious and constructive reading of the statute u/s 144B of the Act as on 01.04.2021; the Circulars dated 22.09.2021 issued by the CBDT u/s 119 of the Act as referred herein above; the decision of the hon'ble ....