The Madras High Court has ruled that both the Jurisdictional Assessing Officer (JAO) and the Faceless Assessment Officer (FAO) possess concurrent jurisdiction to conduct assessments, reassessments, and re-computations under the Income Tax Act, 1961.

The Single Bench of Justice Krishnan Ramasamy, in an order dated December 20, 2024, dismissed a petition filed by a Chennai-based film equipment rental company, Mark Studio India, challenging assessment and re-assessment notices issued by the JAO under Section 148A(d) of the Income Tax Act.

Relying on the Delhi High Court's judgment in TKS Builders vs. ITO (October 2024), the Single Judge observed, “As far as the assessment, re-assessment or re-computation is concerned, this Court is of the considered view that both the Faceless Assessment Officer as well as the Jurisdictional Assessment Officer will have concurrent jurisdiction.”

The Court clarified that while the JAO exclusively holds jurisdiction to issue notices under Section 148 of the IT Act, both the JAO and FAO share jurisdiction in matters of assessment, re-assessment, and re-computation under Section 147.

The petitioner argued that under the faceless assessment scheme introduced in 2022, only the FAO could conduct proceedings under Sections 147 and 148. Represented by Advocate G. Vardhini Karthik, the petitioner contended that the JAO’s involvement undermined the faceless scheme’s objectives.

However, Senior Standing Counsel Dr. B. Ramaswamy, appearing for the Income Tax Department and National Faceless Assessment Unit, countered that the faceless scheme explicitly allows the JAO to issue notices under Sections 148 and 148A, provided they comply with Section 151A by obtaining higher authority approval.

The Court agreed, emphasizing that “While the FAO performs duties in a faceless manner, the JAO is also equally performing his duties in a faceless manner while issuing notices under Section 148A/148 of the IT Act.”

The petitioner highlighted a procedural lapse wherein the JAO's name appeared on the faceless notices, arguing it violated the faceless assessment scheme. However, the Court deemed this a minor procedural error that did not invalidate the notice, as the process adhered to the scheme’s essence.

Cause Title: Mark Studio India Private Limited v. Income Tax Officer & Anr. [W.P.Nos. 25223 of 2024, etc]

Appearance:-

Petitioner: Advocate G. Vandhini Karthik

Respondent: Senior Standing Counsels Dr.B.Ramaswamy, V. Mahalingam, and Junior Standing Counsel S.Premalatha

Click here to read/download the Judgment


Justice Krishnan RamasamyMadras High CourtIncome Tax Act

Sukriti Mishra

    Sukriti Mishra was a Legal Correspondent at Verdictum. She covered the Supreme Court. She completed her graduation with BA. LL.B (Hons.) from The ICFAI University, Dehradun. Sukriti started covering courts in March 2022. She had previously worked with another legal news portal, where she covered the Delhi High Court and Trial Courts.