Invalid Jurisdiction Assumption: Notice Required for Assessment

The High Court held that the assumption of jurisdiction under section 147 without serving the notice under section 148 was invalid, rendering the assessment order illegal and bad in law. The appellant's appeal was allowed due to the lack of proper service of notice under section 148, leading to the rejection of the assessment order regarding the addition of alleged unexplained investment under section 69 of the Act.

---

---

Issues Involved:
1. Validity of assumption of jurisdiction in absence of non-service of notice under section 148 and 142(1) of the act.
2. Confirmation of addition of alleged unexplained investment under section 69 of the Act.

Analysis:
Issue 1: Validity of assumption of jurisdiction in absence of non-service of notice under section 148 and 142(1) of the act.
The appellant challenged the order passed by the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, arguing that the assessing officer assumed jurisdiction without serving notices under section 148 and 142(1) of the Act. The appellant supported their argument with an affidavit and case laws. The CIT(A) dismissed the challenge stating that the notices were served, but the appellant contended that the rejection was unjustified. The High Court held that the statutory notice under section 148 was never served on the appellant, and there was no evidence to refute the appellant's claim. Consequently, the assumption of jurisdiction under section 147 without serving the notice under section 148 was deemed invalid, rendering the assessment order illegal and bad in law.

Issue 2: Confirmation of addition of alleged unexplained investment under section 69 of the Act.
The appellant contested the addition of Rs. 11,44,800 as unexplained investment under section 69 of the Act. They argued that the addition was based on assumptions and presumptions, which are not permitted under the law. The appellant claimed that Rs. 10,00,000 was paid as an advance in the previous year, supported by an agreement to sell. However, the CIT(A) upheld the addition. Since the appellant succeeded on the legal ground of non-service of notice under section 148, other grounds on merits were not adjudicated. Consequently, the appeal of the assessee was allowed, and the assessment order was deemed invalid due to the lack of proper service of notice under section 148.

In conclusion, the judgment focused on the legal issue of the validity of assumption of jurisdiction based on the non-service of notice under section 148, ultimately leading to the allowance of the appellant's appeal and the rejection of the assessment order.

---