Tribunal quashes reassessment order for lack of notice under Income-tax Act

The Tribunal allowed the appeal, quashing the reassessment order due to the absence of the mandatory notice under section 143(2) of the Income-tax Act, 1961. The Tribunal emphasized the necessity of such notice for reassessment cases, citing legal provisions and precedents. The order was deemed void for lacking jurisdiction without the requisite notice. The appeal was allowed, and the assessee's position was upheld, with the order pronounced on 4th March, 2022.

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Issues:
1. Validity of reassessment order passed without issuing notice u/s. 143(2) of the Income-tax Act, 1961.

Analysis:
The appeal was filed against the order of the Ld. CIT(A) regarding the reassessment for AY 2011-12. The original assessment was conducted under section 143(3) of the Act in 2014, and later, a notice u/s. 148 was issued in 2018 to reopen the assessment. The assessee requested the AO to treat the original return filed u/s. 139 as the return for the notice u/s. 148, but the AO proceeded with reassessment u/s. 144/147 without issuing notice u/s. 143(2). The Ld. AR contended that the reassessment order was bad in law due to the absence of the mandatory notice u/s. 143(2), citing a Tribunal decision. The Ld. DR argued that the AO correctly framed the assessment as the assessee did not file the return as directed.

The Tribunal noted the crucial dates and contentions. The Ld. AR emphasized that the absence of notice u/s. 143(2) rendered the reassessment order invalid. On the contrary, the Ld. Addl. CIT, DR argued that the notice should have been served within six months of the original return filing. The Tribunal referred to legal provisions and precedents, including the Supreme Court and High Court decisions, to support the necessity of notice u/s. 143(2) for reassessment cases. It was highlighted that the AO's action lacked jurisdiction without issuing the mandatory notice, rendering the reassessment order void.

The Tribunal found merit in the appeal, quashing the AO's order dated 26.12.2018 passed u/s. 144/147 due to the absence of the mandatory notice u/s. 143(2). Other grounds were considered academic and not adjudicated. Consequently, the appeal of the assessee was allowed, and the order was pronounced on 4th March, 2022.

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