Arkk Builders and Developers (2021 22) vs The Income Tax Officer… — Income Tax | Bombay HC (2025)

Arkk Builders and Developers (2021 22) vs The Income Tax Officer… — Income Tax | Bombay HC (2025)

What the court decided

AI extract

Outcome

Rule made absolute; impugned Notice under Section 148 and all other proceedings/orders emanating therefrom set aside; Writ Petition disposed of in terms thereof with no order as to costs; liberty to the Revenue to revive the petition by Praecipe if Hexaware Technologies Ltd is set aside by the Hon'ble Supreme Court, with an automatic stay on the notice upon revival.

Issue for consideration

Whether the Notice under Section 148 of the Income Tax Act, 1961, issued by the Jurisdictional Assessing Officer when the law mandates issuance by the Faceless Assessing Officer, is vitiated by a fatal defect and liable to be quashed. +1 more

Court's answer

Being fully covered by, and bound to follow, the decision in Hexaware Technologies Ltd (supra), the Court did not keep the matter pending and set aside the impugned Notice issued under Section 148 together with all other proceedings/orders emanating therefrom.

Ratio / Principle

Liberty was granted to the Revenue to revive the writ petition if the decision in Hexaware Technologies Ltd (supra) is set aside by the Hon'ble Supreme Court on this issue, without filing a separate Interim Application (a Praecipe suffices), and upon revival there will be a stay on the operation and implementation of the impugned Section 148 notice until further orders; dismissal of the SLP would leave no question of revival.

Key takeaways

If the petition is revived and restored, it will be decided on its own merits, considering that several other issues challenging the Section 148 Notice remain.ratio¶¶28

Detailed headnote1 paragraphs

Writ Petition allowed and disposed of: Notice under Section 148 of the Income Tax Act, 1961, issued by the Jurisdictional Assessing Officer contrary to the mandate that it be issued by the Faceless Assessing Officer, was set aside along with all proceedings/orders emanating therefrom, the Court holding itself bound to follow its Division Bench decision in Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2), (2024) 162 taxmann.com 225 (Bombay). Although that decision is under challenge before the Hon'ble Supreme Court, the Revenue conceded there is no stay on it; the Court therefore declined to keep the matter pending. Liberty was granted to the Revenue to revive the petition by merely moving a Praecipe (no separate Interim Application required) if Hexaware is set aside by the Supreme Court, with an automatic stay on the notice upon revival; if the SLP is dismissed, no revival arises. Any restored petition is to be decided afresh on its own merits on all remaining issues. No order as to costs.

30.os.wp.1916.2025.doc

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

WRIT PETITION NO. 1916 OF 2025

VINA ARVIND KHADPE

Digitally signed by VINAARVIND KHADPE Date: 2025.12.16 16:10:14 +0530

Arkk Builders and Developers .. Petitioner

Versus

The Income Tax Officer, Ward 27(1)(1), Mumbai & Ors. .. Respondents

Mr. Dharan Gandhi a/w Ms. Aanchal Vyas Advocates for the Petitioner.

Mr. Arjun Gupta, Advocate for the Respondents/Revenue.

CORAM: B. P. COLABAWALLA & AMIT S. JAMSANDEKAR, JJ. DATE: DECEMBER 8, 2025

P. C.

In the above Petition Rule was issued on 18^th November 2024 and interim relief was also granted interalia staying the Notice issued under Section 148 of the Income Tax Act, 1961. Today, though the matter has come up under the caption “for directions”, we have, with the consent of parties, heard it finally.

The above Writ Petition interalia challenges the Notice issued under

Section 148 of the Income Tax Act, 1961 on various grounds. One of the

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grounds is that the Notice has been issued by the Jurisdictional Assessing Officer when the law mandates that it has to be issued by the Faceless Assessing Officer. This is a fatal defect and therefore the Notice has to be quashed, is the argument of the Petitioner.

It is the Petitioners’ contention that this issue is squarely covered by a decision of a Division Bench of this Court in the case of Hexaware Technologies Ltd. V/S Assistant Commissioner of Income-tax, Circle 15(1)(2) [(2024) 162 taxmann.com 225 (Bombay)].

On the other hand, the learned advocate appearing on behalf of the Revenue stated that though it is true that this issue is concluded by the decision in Hexaware Technologies Ltd (supra), the said decision has been challenged before the Hon’ble Supreme Court, and the Hon’ble Supreme Court is likely to take up the matter shortly. The learned Counsel for the Revenue has fairly stated that there is no stay to the judgment in Hexaware Technologies Ltd (supra).

Considering these facts, we do not propose to keep the matter pending in this Court. Once it is fully covered by the decision in Hexaware Technologies Ltd (supra) we are bound to follow it.

Rohit Ghuge (PA)13 pt

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We accordingly set aside the impugned Notice issued under Section 148 and all other proceedings/orders emanating therefrom.

We however grant liberty to the Revenue to revive the above Writ Petition in the event the decision in Hexaware Technologies Ltd (supra) is set aside by the Hon’ble Supreme Court on this issue. We make it clear that it will not be necessary for the Revenue to file a separate Interim Application to seek a revival of this Petition and the same can be done simply by moving a Praecipe before this Court. It is further ordered that in the event the above Petition is revived, there will be a stay to the operation and implementation of the impugned notice issued under Section 148 until further orders. It is needless to clarify that if the Hon’ble Supreme Court dismisses the SLP challenging the decision in Hexaware Technologies Ltd (supra), there would be no question of any revival.

We also make it clear that once the Petition is revived and restored, the same would have to be decided on its own merits considering that several other issues are also raised challenging the Notice issued under Section 148.

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Rule is accordingly made absolute and the Writ Petition is also disposed of in terms thereof. However, there shall be no order as to costs.

This order will be digitally signed by the Private Secretary/ Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order.

[ AMIT S. JAMSANDEKAR , J.] [B. P. COLABAWALLA, J.]

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