Jurisdictional defect in reassessment notice cannot be cured by service provisions or deemed participation

A reassessment notice issued under section 148 by an officer lacking territorial jurisdiction over the assessee is invalid, because the belief that income has escaped assessment must be formed and acted on by the jurisdictional Assessing Officer who records the requisite reasons under section 147. Where the assessee's jurisdiction lay elsewhere and no fresh notice was issued by the proper officer, the reassessment could not be sustained. The defect was not cured by section 124(3)(b), since the objection was raised before completion of assessment and valid service was not shown, and section 292BB could not validate a notice issued without jurisdiction.

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Issues: Whether the reassessment proceedings were valid when the notice under section 148 was issued by an officer lacking jurisdiction over the assessee, and whether the defect could be cured by section 124(3)(b) or section 292BB of the Income-tax Act, 1961.

Analysis: The assessee's jurisdiction lay with the New Delhi ward, but the notice under section 148 was issued by the Gurgaon officer who did not have territorial jurisdiction. The jurisdictional officer at New Delhi never issued a fresh notice under section 148 nor recorded reasons as required for reopening under section 147. A notice for reassessment must be issued by the Assessing Officer having jurisdiction, since the belief that income has escaped assessment must be that of that officer alone. Section 124(3)(b) did not bar the objection because the record did not show valid service of the jurisdictional notice and the assessee objected before completion of assessment. Section 292BB also could not cure a notice issued without jurisdiction.

Conclusion: The reassessment notice was invalid, the reassessment order was without jurisdiction, and the Revenue's appeal failed.

Ratio Decidendi: A notice under section 148 for reopening must be issued by the Assessing Officer who has jurisdiction over the assessee and has recorded the requisite reasons under section 147; a notice issued by a non-jurisdictional officer is an incurable jurisdictional defect and cannot be validated by section 124(3)(b) or section 292BB.

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