Reassessment Quashed: J.A.O. Lacked Jurisdiction Post-Faceless Scheme

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Telangana High Court Strikes Down Reassessment Initiated by Jurisdictional A.O. under Section 148.

The transition to the **Faceless Assessment** regime continues to generate rulings that define the proper jurisdiction under the new scheme. A recent judgment by the Telangana High Court confirms a critical legal issue: the Jurisdictional Assessing Officer (JAO) loses the authority to initiate reassessment proceedings under Sections 148A and 148 after the implementation of the centralized **e-Assessment of Income Escaping Assessment Scheme, 2022**.

Background: The Core Jurisdictional Dispute

The assessees filed writ petitions challenging the initiation of reassessment proceedings under Sections 148A and 148 by the **Jurisdictional Assessing Officer (JAO)**. The challenge was premised on the fact that the proceedings were initiated after the **e-Assessment of Income Escaping Assessment Scheme, 2022** was notified:

Faceless Scheme Implementation:

  • **Scheme:** e-Assessment of Income Escaping Assessment Scheme, 2022.
  • **Governing Section:** Notified under Section 151A of the Income-tax Act, 1961.
  • **Effective Date:** With effect from 29.03.2022 (Notification No. 18/2022).

The assessees argued that once the faceless scheme took effect, the JAO ceased to be the competent authority to initiate these proceedings.

The High Court’s Decisive Ruling

The Telangana High Court ruled that the legal issue concerning the lack of jurisdiction on the part of the Jurisdictional Assessing Officer to initiate proceedings post-implementation of the Faceless Scheme is **no longer res integra** (a matter unsettled by legal precedent).

Judgment Confirmation:

The Court followed its own precedent set in the case of Kankanala Ravindra Reddy v. Income Tax Officer [2023], and the consistent view of other jurisdictional High Courts. This legal stance dictates that reassessment under Sections 148A and 148 must be conducted centrally under the Faceless Scheme and not locally by the JAO.

**Conclusion:** The impugned proceedings initiated under Sections 148A and 148 were declared to be without jurisdiction and were accordingly **set aside**.

Professional Insight: Key Takeaway 💡

This ruling provides a powerful tool for taxpayers challenging reassessment notices issued by their local JAO after March 29, 2022. It reinforces that the method of assessment is procedural and mandatory. If the notice under **Section 148/148A** lacks the jurisdiction specified under the **Faceless Scheme (Section 151A)**, the entire proceeding is fatally flawed and must be challenged on the procedural ground of **lack of jurisdiction**.

Case Citation: Yashnu Yasasvi Polucherla vs. Income-tax Officer [2025] 179 taxmann.com 470 (Telangana).

Statutory Reference: Sections 148A, 148, and 151A of the Income-tax Act, 1961.

Circular/Notification: Notification No. 18 of 2022, Dated 29-3-2022.

Location: Vijayawada, Andhra Pradesh, India

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