Pending Rectification Appeal Does Not Bar Reassessment Under

Pending Rectification Appeal Does Not Bar Reassessment Under Section 148 Based On Fresh Section 135A Information

Issue

Whether the issuance of a reassessment notice under Section 148 based on independent information received under Section 135A is jurisdictionally barred or constitutes invalid parallel proceedings when an appeal against a Section 154 rectification order arising from Section 143(1) processing is pending before the Commissioner (Appeals).

Facts

The assessee filed its return of income for Assessment Year 2022-23, which was processed under Section 143(1) with certain adjustments relating to interest income and TDS credit.
The assessee filed a rectification application under Section 154 regarding these adjustments, which was rejected by the Assessing Officer (AO).
The assessee then filed an appeal against the rejection of the Section 154 rectification order before the Commissioner (Appeals), which remained pending.
Meanwhile, the AO obtained approval under Section 151 and issued a reassessment notice under Section 148 based on independent information received under the scheme notified under Section 135A.
The assessee challenged the Section 148 reassessment notice before the High Court, contending that it lacked inherent jurisdiction and resulted in illegal parallel proceedings on the same assessment year.

Decision

The Court held that invoking jurisdiction under Section 148 does not suffer from any inherent lack of jurisdiction merely because an appeal arising out of Section 143(1) summary processing read with Section 154 is pending before the appellate authority.
The Court observed that proceedings under Section 143(1) are strictly confined to mechanical adjustments while processing the return, whereas the Section 148 reassessment notice was founded on distinct “information” received under Section 135A.
The Court clarified that the adequacy or correctness of the information forming the basis of a Section 148 notice cannot be mini-adjudicated or examined at the threshold stage under writ jurisdiction.
The Court concluded that the impugned Section 148 notice did not result in impermissible parallel proceedings because the issues and amounts involved in the Section 143(1) summary adjustments were completely distinct from the subject matter of the Section 148 reassessment.
The writ petition was dismissed in favor of the Revenue.

Key Takeaways

No Doctrine of Merger for Section 143(1) Summaries: Summary processing or rectification proceedings under Sections 143(1)/154 do not preclude or bar the Revenue from reopening an assessment under Section 148 based on separate, tangible information.
Distinct Scope of Proceedings: Reassessment under Section 148 and summary adjustments under Section 143(1) operate in separate legal domains; pendency of an appeal against a Section 154 rejection does not oust Section 148 jurisdiction.
Threshold Challenge to Information Scope Restricted: High Courts will not evaluate the adequacy or factual accuracy of Section 135A information at the initial stage of challenging a Section 148 notice.

HIGH COURT OF RAJASTHAN

Dhanwanti Jain

Income-tax Officer

MUNNURI LAXMAN and Anuroop Singhi, JJ.

D.B. Civil Writ Petition No. 12513 of 2026^†

JULY 7, 2026

Sharad Kothari and Chirag Soni for the Petitioner. Sunil Bhandari for the Respondent.

ORDER

1. In impugnment are the reassessment notice dated 19.03.2026 issued under Section 148 of the Income Tax Act, 1961 (for short ‘the Act of 1961’) (Annexure-2) and sanction note dated 18.03.2026 (Annexure-3) on the ground that the reassessment proceedings are without jurisdiction and have been initiated in defiance of the applicable provisions of the Act of 1961.

2. Perusal of the record reveals that the reassessment notice dated 19.03.2026 was issued to the assessee, the basis of which was the information received under the scheme notified under Section 135A of the Act of 1961 regarding an alleged mismatch in the interest income of the petitioner.

3. The case of the petitioner is that she filed her income tax return for the assessment year 2022-23 declaring her total income under different heads. While processing the return under Section 143(1) of the Act of 1961, the Centralised Processing Centre (CPC) made certain adjustments relating to petitioner’s interest income and the consequential TDS credit. Aggrieved by such adjustments, the petitioner filed rectification application under Section 154 of the Act of 1961 which came to be rejected, aggrieved by which the petitioner preferred an appeal before the Commissioner (Appeals) at National Faceless Appeal Centre (NFAC) which as per the petitioner is still pending consideration.

4. During the pendency of the said appeal, the Assessing Officer issued a notice under Section 148 of the Act of 1961 dated 19.03.2026 after obtaining approval/sanction dated 18.03.2026 from the competent authority specified under Section 151 of the Act of 1961, proposing to reopen the assessment alleging escapement of income and mismatch in the interest income of the petitioner on the basis of information received under the scheme notified under Section 135A of the Act of 1961.

5. Learned counsel for the petitioner submits that no such mismatch as alleged in the notice issued under Section 148 of the Act of 1961 exists, as the entire income including the interest income had already been duly disclosed by the petitioner in the income tax return.

6. Learned counsel submits that the impugned notice has been issued on a mechanical basis without any independent application of mind or recording any objective satisfaction with respect to the allegations made about escapement of income and mismatch of interest income.

7. Learned counsel further submits that an appeal has already been filed by the petitioner on the very same issue which is pending consideration before the appellate authority and the initiation of the reassessment proceedings on the same issue based on identical facts amounts to parallel proceedings by the respondent – Authorities.

An objection/representation dated 13.04.2026 in this regard was also submitted by the petitioner pointing out that the issue of mismatch of income is already pending consideration before the Commissioner (Appeals), NFAC, in the statutory appeal filed by the petitioner and thus, the issuance of the impugned notice under Section 148 of the Act of 1961 and the consequent initiation of proceedings amounts to parallel proceedings, however, vide communication dated 16.04.2026, the said objection/ representation has been rejected by the respondents.

8. Hence, aggrieved by the issuance of the impugned notice under Section 148 of the Act of 1961 dated 19.03.2026 read with the sanction note dated 18.03.2026, the present writ petition has been filed.

9. Per contra, learned counsel appearing for the respondents submits that the present writ petition is wholly misconceived and is not maintainable inasmuch as the petitioner seeks to invoke the extraordinary writ jurisdiction of this Court at the stage of issuance of notice under Section 148 of the Act of 1961, which has been issued in accordance with law by the competent authority having jurisdiction. It is submitted that the petitioner has ample opportunity to file a reply to the impugned notice, produce the relevant documents and evidence, and raise all factual and legal objections before the Assessing Officer, who would be duly considering the same in accordance with law.

Further, in the event of any assessment order being passed with which if the petitioner feels aggrieved, the Act of 1961 provides a mechanism of statutory remedies and thus, there is no ground to entertain the present writ petition.

10. Learned counsel further submits that the reassessment proceedings have been initiated strictly in accordance with the provisions of the Act of 1961 after receipt of information under the Scheme notified under Section 135A of the Act of 1961 and upon obtaining the requisite approval from the authority specified under Section 151 of the Act of 1961. It is submitted that the validity or correctness of such information cannot be examined in writ jurisdiction at this preliminary stage.

11. Learned counsel also submits that the pendency of the appeal before the Commissioner (Appeals), NFAC, does not preclude the Assessing Officer from initiating reassessment proceedings under Section 148 of the Act of 1961, where there exists information suggesting escapement of income. It is submitted that the proceedings arising out of the intimation issued under Section 143(1) of the Act of 1961 and the reassessment proceedings initiated under Section 148 of the Act of 1961 operate in distinct fields on different statutory considerations.

Learned counsel also submits that the petitioner has failed to demonstrate that issue and amount involved in both these proceedings are identical and thus, under no circumstances the said proceedings can be termed as parallel proceedings.

12. Learned counsel finally submits that no case of inherent lack of jurisdiction or violation of any statutory provision has been made out by the petitioner so as to warrant interference by this Court at the threshold and thus, prayed that the writ petition be dismissed.

13. Heard learned counsel for the parties and perused the material available on record.

14. The primary challenge by the petitioner is on the ground that the impugned notice issued under Section 148 of the Act of 1961 is without jurisdiction as the very issue is already pending before the Commissioner (Appeals), NFAC. The jurisdiction invoked by the Assessing Officer under Section 148 of the Act of 1961 cannot be said to suffer from any inherent lack of jurisdiction merely because an appeal arising out of the proceedings under Section 143(1) read with Section 154 of the Act of 1961 is pending before the appellate authority. The proceedings under Section 143(1) are confined to the adjustments made while processing the return, whereas the impugned notice under Section 148 has been issued on the basis of ‘information’ received under the scheme notified under Section 135A of the Act of 1961.

15. Whether such information ultimately results into an addition or not is a matter to be examined by the Assessing Officer during the reassessment proceedings and, if necessary, by the statutory appellate authorities thereafter. At this stage, no case of inherent lack of jurisdiction is made out warranting interference under Article 226 of the Constitution.

16. The further contention of the petitioner that the reassessment proceedings are contrary to the Scheme notified under Section 135A also does not merit acceptance at this stage. Such issue pertains to the merits of the reassessment and are matters which can appropriately be urged before the Assessing Officer in the course of reassessment proceedings and thereafter before the statutory appellate forums. The writ court, at the stage of issuance of notice under Section 148 of the Act of 1961, would not ordinarily undertake an adjudication on the adequacy or correctness of the information forming the basis of such notice.

17. The contention of the petitioner that the impugned notice results in parallel proceedings on the very same issue also does not merit acceptance. A simultaneous perusal of the proceedings arising from the intimation under Section 143(1), the memo of appeal filed by the petitioner before the Commissioner of Income Tax (Appeals), the reasons recorded for issuance of the notice under Section 148, the objections submitted by the petitioner to the reassessment proceedings and so also the communication dated 16.04.2026 made by the Assessing Officer, to which admittedly no challenge has been made by the petitioner, fails to demonstrate that the proceedings initiated under Section 143(1) and Section 148 of the Act of 1961 are identical, as the issues raised and the amounts involved are distinct.

The proceedings under Section 143(1) and the consequential appeal relate to adjustments made while processing the return, whereas the reassessment proceedings have been initiated on the basis of information received by the Assessing Officer by invoking the provisions of Section 135A of the Act of 1961, which as per Section 148 of the Act of 1961 duly constitues an information.

Merely because certain factual aspects may incidentally relate to the same return of income does not render both proceedings identical in law or establish that the reassessment proceedings are wholly without jurisdiction.

Also, no fault can be found in the sanction note dated 18.03.2026 which has been issued after duly considering the relevant aspects.

18. It is well settled that the writ jurisdiction of this Court is not intended to interdict statutory proceedings at the threshold unless the notice ex facie suffers from a patent lack of jurisdiction, is barred by law, have been issued in violation of the principles of natural justice or is vitiated by mala fides. None of these exceptional circumstances could be demonstrated in the present case. The petitioner has adequate statutory remedies available under the Act of 1961 to participate and raise all objections, both factual and legal, before the Assessing Officer as well as before the appellate authorities, if need so arises.

19. Accordingly, the present writ petition is dismissed.

20. Pending application(s), if any, also stands dismissed.