Section 143(1) demand requires proof of intimation and service; portal entries alone cannot justify refund adjustment.

A demand reflected on the tax portal could not be enforced where the Revenue failed to produce the Section 143(1) intimation or prove its service on the assessee. The Bombay HC applied its prior view that, when an intimation under Section 143(1) creates a demand, that intimation must be served and cannot be replaced by a bare portal entry or unsupported demand record. As the respondents could not substantiate either the existence or service of the demand, the Court drew an adverse inference and held the demand unsustainable. Adjustment of a later-year refund against that unenforceable demand was therefore invalid.

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Issues: Whether, in the absence of a produced and duly served intimation under Section 143(1), the demand reflected on the portal could be treated as enforceable and whether the refund for a later assessment year could be adjusted against such demand.

Analysis: The material on record did not include the actual intimation under Section 143(1) or proof of its service on the petitioner. The Court relied on its earlier view that an intimation under Section 143(1), when it results in a demand, has to be served on the assessee and that a demand cannot be enforced in the absence of the underlying intimation or any independent notice of demand. Since the respondents were unable to substantiate the existence and service of the alleged demand, the Court drew an adverse inference and held that the demand could not be sustained. On that basis, the adjustment of refund against such demand was also unsustainable.

Conclusion: The demand shown on the portal was not enforceable and the adjustment of refund against it was invalid, hence the petitioner succeeded.

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