Jurisdictional notice defect invalidates scrutiny assessment where the issuing officer lacks authority under the applicable CBDT instruction

A scrutiny assessment is vulnerable where the notice under section 143(2) is issued by an officer lacking the jurisdiction prescribed by CBDT Instruction No. 01/2011. For income falling within the category assigned to an Income-tax Officer, issuance by an Assistant Commissioner or Deputy Commissioner constitutes a jurisdictional defect rather than a curable irregularity. Because jurisdiction to initiate scrutiny is a condition precedent, the resulting assessment cannot be sustained. The assessment was therefore quashed, while the additions were not examined on merits.

---

---

Issues: Whether the assessment was invalid because the notice under section 143(2) was issued by an Assessing Officer who lacked jurisdiction under CBDT Instruction No. 01/2011.

Analysis: The assessee's returned income fell within the category where, under the Board instruction, jurisdiction lay with the Income-tax Officer and not with the Assistant Commissioner/Deputy Commissioner. The notice under section 143(2) was issued by an officer lacking such jurisdiction. Since jurisdiction to initiate scrutiny is a condition precedent, the defect was held to be jurisdictional and not curable. The assessment framed on the basis of that notice was therefore unsustainable.

Conclusion: The notice under section 143(2) was invalid and the assessment order was quashed, in favour of the assessee.

Final Conclusion: The jurisdictional challenge succeeded and the additions were not examined on merits.

Ratio Decidendi: A scrutiny assessment initiated by a notice issued by an officer lacking the jurisdiction prescribed by the applicable CBDT instruction is void for want of jurisdiction, and the resulting assessment cannot be sustained.

---