Pecuniary jurisdiction defect invalidates reassessment notice and quashes assessment when notice is issued by unauthorised officer.

A reassessment notice under section 148 issued by an Income-tax Officer lacking the prescribed pecuniary jurisdiction was invalid because, under CBDT Instruction No. 1/2011, jurisdiction for a case above the metro-city threshold vested in the Assistant/Deputy Commissioner. The jurisdictional defect was treated as going to the root of the matter and not capable of cure, so the reassessment founded on that notice could not be sustained. The notice and consequential reassessment order were therefore quashed as without jurisdiction.

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Issues: Whether the notice issued under section 148 of the Income-tax Act, 1961 by an Income-tax Officer lacking pecuniary jurisdiction, in view of CBDT Instruction No. 1/2011, was invalid and whether the reassessment order based on such notice was liable to be quashed.

Analysis: The returned income being above the monetary threshold prescribed for metro cities, jurisdiction lay with the Assistant/Deputy Commissioner and not with the Income-tax Officer. The notice under section 148 was therefore issued by an officer not authorised in law. The defect went to the root of the reassessment and was not curable. Relying on the binding CBDT instruction and the consistent view taken in prior decisions, the reassessment initiated on the strength of the defective jurisdictional notice could not stand.

Conclusion: The notice under section 148 and the consequential reassessment order were held to be without jurisdiction and were quashed, in favour of the assessee.

Ratio Decidendi: A reassessment notice issued by an officer lacking the prescribed pecuniary jurisdiction is void ab initio, and any assessment founded on such notice is liable to be annulled.

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