Theo Connect Pvt. Ltd. vs Assistant Commissioner of Income… — Income Tax | Bombay HC (2025)

Theo Connect Pvt. Ltd. vs Assistant Commissioner of Income… — Income Tax | Bombay HC (2025)

What the court decided

AI extract

Outcome

Impugned Section 148 Notice and all proceedings/orders emanating therefrom set aside; Rule made absolute and Writ Petition disposed of; liberty reserved to the Revenue to revive the Petition by Praecipe if the Hexaware decision is set aside by the Hon'ble Supreme Court; no order as to costs.

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 that it be issued by the Faceless Assessing Officer, is vitiated by this fatal defect and must be quashed.

Court's answer

The Petitioner's ground that the Section 148 Notice was issued by the Jurisdictional Assessing Officer when the law mandates issuance by the Faceless Assessing Officer is fully covered by the Division Bench decision of this Court in Hexaware Technologies Ltd (supra), and this Court is bound to follow it.

Ratio / Principle

The impugned Notice issued under Section 148 and all other proceedings/orders emanating therefrom are set aside.

Key takeaways

Liberty is granted to the Revenue to revive the Writ Petition in the event the decision in Hexaware Technologies Ltd (supra) is set aside by the Hon'ble Supreme Court on this issue; no separate Interim Application is necessary and revival can be sought simply by moving a Praecipe.ratio¶¶24
If the Petition is revived and restored, it would have to be decided on its own merits, since several other issues challenging the Section 148 Notice were also raised.ratio¶¶25

Detailed headnote1 paragraphs

Bombay High Court (Ordinary Original Civil Jurisdiction), Writ Petition No. 2068 of 2025 — Theo Connect Pvt. Ltd. v. Asst. Commissioner of Income Tax, Central Circle 5(3), Mumbai & Ors. (Coram: B. P. Colabawalla & Firdosh P. Pooniwalla, JJ.; decided 14 July 2025). The petition challenged a Notice under Section 148 of the Income Tax Act, 1961, on the ground that it was issued by the Jurisdictional Assessing Officer whereas the law mandates issuance by the Faceless Assessing Officer — a contended fatal defect requiring quashing. Holding the point squarely covered by its own Division Bench decision in Hexaware Technologies Ltd. v. Assistant Commissioner of Income-tax, Circle 15(1)(2), (2024) 162 taxmann.com 225 (Bombay) — which the Revenue acknowledged is under challenge before the Hon'ble Supreme Court but unstayed — the Court, being bound to follow it, set aside the impugned Notice and all proceedings/orders emanating therefrom, made Rule absolute and disposed of the petition with no order as to costs. Liberty was reserved to the Revenue to revive the petition by merely moving a Praecipe (no separate Interim Application needed) if the Supreme Court sets aside the Hexaware decision; a revived petition is to be decided afresh on its own merits, several other issues against the Notice remaining.

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Digitally signed by TRUSHA TRUSHA TUSHAR TUSHAR MOHITE MOHITE Date: 2025.07.17 15:14:49 +0530

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

WRIT PETITION NO.2068 OF 2025

Theo Connect Pvt.Ltd. .. Petitioner

Versus

Asst.Commissioner of Income Tax, Central Circle 5(3), Mumbai and Ors. .. Respondents

Mr.Devendra Jain a/w Mr.Shashank Mehta i/b Ms.Radha Halbe, Advocate for the Petitioner.

Ms.Swapna Gokhale, Advocate for the Respondents.

CORAM: B. P. COLABAWALLA & FIRDOSH P. POONIWALLA, JJ. DATE: JULY 14, 2025

P. C.

In the above Petition Rule was issued on 23^rd September 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 Page 1 of 4 JULY 14, 2025

Mohite

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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 immediately on re-opening. She 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.

Mohite

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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.

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.

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.

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Mohite

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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.

[FIRDOSH P. POONIWALLA, J.] [B. P. COLABAWALLA, J.]

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Mohite