2020 (8) TMI 586 - AT - Income Tax

Tribunal invalidates re-assessment due to defective notice, emphasizes procedural compliance

The Tribunal upheld the decision to quash the re-assessment proceedings initiated under section 147/148 of the I.T. Act, 1961, due to the defective notice ... Reopening of assessment u/s 147 - invalid notice - unsigned notice - HELD THAT:- Copy of the notice u/s 148 is unsigned as well as did not mention any assessment year. Since unsigned notice have been sent to the assessee, therefore, it vitiate the entire re-assessment proceedings because it was the jurisdictional notice to initiate proceedings u/s 147 . Since the notice itself was illegal and bad in Law, therefore, entire re-assessment proceedings have been vitiated and as such A.O. could not have assume the jurisdiction under section 148 to frame the assessment against the assessee. The Ld. CIT(A) was justified in holding the assessment order to be null and void. The Departmental Appeal has no merit and the same is accordingly dismissed. - Decided in favour of assessee. Issues:Quashing of re-assessment proceedings under section 147/148 of the I.T. Act, 1961.Analysis:1. Quashing of Re-assessment Proceedings:The Departmental appeal and Cross Objection by the Assessee were directed against the Order of the Ld. CIT(A)-3 for the A.Y. 2000-2001. The assessee objected to the re-assessment proceedings initiated under section 147/148 of the I.T. Act, 1961, contending that the notice received was unsigned and did not mention the assessment year. The Ld. CIT(A) found that the unsigned notice was indeed received by the assessee, and as it was a jurisdictional notice, the reopening of the assessment was deemed null and void. The Tribunal upheld this decision, emphasizing that the entire re-assessment proceedings were vitiated due to the illegal and defective notice, rendering the assessment order invalid.2. Cross Objection by the Assessee:The assessee raised additional grounds in the cross objection challenging the reopening of the assessment, which were not addressed by the Ld. CIT(A). However, since the Departmental Appeal was dismissed based on the defective notice issue, the Tribunal considered the cross objection as academic and infructuous, ultimately dismissing it. Therefore, the cross objection by the assessee was also rejected.In conclusion, the Tribunal dismissed both the Departmental Appeal and the Cross Objection by the Assessee, upholding the decision to quash the re-assessment proceedings due to the defective notice received by the assessee. The assessment order was deemed null and void, emphasizing the importance of complying with procedural requirements under the I.T. Act, 1961 for initiating re-assessment proceedings.