Assessment order invalid when no Section 143(2) notice issued, Section 292BB cannot cure complete absence of notice

The Delhi HC ruled that an assessment order under Section 153C read with Section 143(3) is invalid when no notice under Section 143(2) is issued. The court held that Section 292BB cannot cure the complete absence of notice, only defects in service of an existing notice. Following the SC precedent in Laxman Das Khandelwal, the court distinguished between deficient notice service and complete absence of notice, ruling that Section 292BB applies only to remedy infirmities in service, not to validate assessments where no notice was issued at all. Decision favored the assessee.

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Issues Involved:
The judgment involves condonation of delay in re-filing the appeal and the challenge to an order passed by the Income Tax Appellate Tribunal regarding the Assessment Year 2013-14.

Condonation of Delay:
The appellant sought condonation of a 430-day delay in re-filing the appeal, which was considered substantial. The court decided to condone the delay and proceed with hearing the appeal on merits.

Appeal Concerning Assessment Year 2013-14:
The appellant/revenue aimed to challenge the order passed by the Income Tax Appellate Tribunal related to the Assessment Year 2013-14. The Commissioner of Income Tax (Appeals) had quashed the assessment order due to the absence of a notice under Section 143(2) of the Income-tax Act before it was framed.

Factual Background:
The respondent/assessee had filed the original Return of Income for the Assessment Year in question, declaring a loss. Following a search and seizure operation regarding a sister concern of the respondent/assessee, the respondent's case was taken up for scrutiny. Notices were issued under Section 142(1) of the Act, and proceedings were initiated concerning unsecured loans received by the respondent/assessee.

Legal Arguments:
The appellant contended that the absence of a notice under Section 143(2) did not render the assessment order defective, relying on Section 292BB of the Act. However, both the CIT(A) and the Tribunal confirmed that no such notice was issued, leading to a discussion on the impact of Section 292BB.

Decision and Conclusion:
The court held that the absence of a notice under Section 143(2) before framing the assessment order rendered it defective, despite arguments to the contrary. Citing relevant legal precedents, the court dismissed the appeal, stating that no substantial question of law arose for consideration. The appeal was closed, and the order was to be dispatched to the respondent/assessee via all modes, including email, for further action.

Separate Judgement Highlight:
The judgment was delivered by Hon'ble Mr. Justice Rajiv Shakdher and Hon'ble Mr. Justice Girish Kathpalia.

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