TaxTMI 
TaxTMI 
2026 (5) TMI 288
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....n Plastic Industry. He derives income from share in the partnership firm, income from capital gain and income from other sources. The case of the assessee was reopened u/s 147 of the Act by issue of notice u/s 148 of the Act on 25.03.2019 which was duly served on the assessee. The assessee in response to the notice issued u/s 148 of the Act filed his return of income on 11.12.2019 declaring total income of Rs. 3,76,494/-. The Assessing Officer thereafter issued notice u/s 142(1) of the Act. Rejecting the various explanations given by the assessee, the Assessing Officer made addition of Rs. 57,05,787/- on account of long term capital gain and also made addition of Rs. 75,84,125/- being the difference between total fixed deposits declared by the assessee at Rs. 25,68,457/- and information obtained from the bank u/s 133(6) of the Act at Rs. 1,01,52,582/-. 4. Before the Ld. CIT(A) / NFAC the assessee, apart from challenging the addition on merit, challenged the validity of re-assessment proceedings on the ground that no notice u/s 143(2) of the Act was issued to the assessee after filing the return of income on 11.12.2019 in response to notice issued u/s 148 of the Act, therefore, s....
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....icer issued a notice u/s 148 of the Act on 25.03.2019, copy of which is placed at page 1 of the paper book. He submitted that the assessee in response to the same filed his return of income on 11.12.2019, copy of which is placed at page 2 of the paper book. He submitted that after the return was filed no notice u/s 143(2) of the Act was issued by the Assessing Officer. 8. Referring to the decisions of Hon'ble Delhi High Court in the case of PCIT vs. Staunch Marketing (P.) Ltd. reported in (2017) 81 taxmann.com 482 (Del), PCIT vs. Shri Jai Shiv Shankar Traders (P.) Ltd. reported in (2015) 64 taxmann.com 220 (Del), PCIT vs. Draft Infrabuild (P.) Ltd. reported in (2023) 166 taxmann.com 4 (Del) and the decision of Hon'ble Patna High Court in the case of CIT vs. Nagendra Prasad reported in (2023) 156 taxmann.com 19 (Patna), he submitted that the Hon'ble High Courts have held that even where the return was filed belatedly if the Assessing Officer considers such return while framing the assessment, notice u/s 143(2) of the Act is mandatory. 9. Referring to the decisions in the following cases, he submitted that similar view has been taken holding that once the return is filed in res....
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.... sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the Assessing Officer in the instant case issued notice u/s 148 of the Act on 25.03.2019. We find the assessee in the instant case filed his return of income on 11.12.2019 which is after the statutory period of 30 days given by the Assessing Officer. It is also an admitted fact that the assessment order was passed on 20.12.2019 and no notice u/s 143(2) of the Act has been issued and served on the assessee before completion of the assessment. Under these circumstances, we have to see as to whether non-issue of notice u/s 143(2) of the Act renders the assessment proceedings invalid when the assessee filed the return in response to the notice issued u/s 148 of the Act belatedly. 15. We find an identical issue had come up before the Hon'ble Delhi High Court in the case of PCIT vs. Draft Infrabuild (P.) Ltd. (supra). We find the Hon'ble High Court, following its earlier order in the case of PCIT vs. Shri Jai Shiv Shankar Traders (P.) Ltd. (supra) and various other decisions, has held th....
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....bservations made in Principal Commissioner of Income-tax v. Shri Jai Shiv Shankar Traders (P.) Ltd. [2015] 64 taxmann.com 220/383 ITR 448 (Delhi) : "12. The narration of facts as noted above by the court makes it clear that no notice under section 143(2) of the Act was issued to the assessee after December 16,2010, the date on which the assessee informed the Assessing Officer that the return originally filed should be treated as the return filed pursuant to the notice under section 148 of the Act. 13. In DIT v. Society for Worldwide Interbank Financial Telecommunications [2010] 323 ITR 249 (Delhi), this court invalidated a reassessment proceeding after noting that the notice under section 143(2) of the Act was not issued to the assessee pursuant to the filing of the return. In other words, it was held mandatory to serve the notice under section 143(2) of the Act only after the return filed by the assessee is actually scrutinised by the Assessing Officer. 14. The interplay of sections 143(2) and 148 of the Act formed the subject matter of at least two decisions of the Allahabad High Court in CIT v. Rajeev Sharma [2010] 192 Taxman 197/336 ITR 678 (Allahabad....
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....of the Act cannot obviate the requirement or complying with a jurisdictional condition. For the Assessing Officer to make an order of assessment under section 143(3) of the Act, it is necessary to issue a notice under section 143(2) of the Act and in the absence of a notice under section 143(2) of the Act, the assumption of jurisdiction itself would be invalid." 16. In the same decision in Salarpur Cold Storage (P.) Ltd. (supra), the Allahabad High Court noticed that the decision of the Supreme Court in Hotel Blue Moon (supra) where in relation to block assessment, the Supreme Court held that the requirement to issue notice under Section 143(2) was mandatory. It was not "a procedural irregularity and the same is not curable and, therefore, the requirement of notice under Section 143(2) cannot be dispensed with." 17. The Madras High Court held likewise in Sapthagiri Finance & Investments v. ITO [2012] 25 taxmann.com 341/210 Taxman 78 (Madras) (Mag.). The facts of that case were that a notice under Section 148 of the Act was issued to the Assessee seeking to reopen the assessment for AY 2000-01. However, the Assessee did not file a return and therefore a notice was ....
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....(2) of the Act subsequent to 16th December 2010 when the Assessee made a statement before the AO to the effect that the original return filed should be treated as a return pursuant to a notice under Section 148 of the Act, is fatal to the order of re-assessment. " [Emphasis is ours] IV. Conclusion: 16. On both aspects, the Tribunal is right. The Tribunal has returned findings of fact on the two issues adverted to hereinabove. 17. Thus, for the foregoing reasons, which are (i) that notice under Section 148 of the Act was improperly served, and (ii) that notice under Section 143(2) should have been issued before framing of assessment order under Section 147/144 of the Act, we are not inclined to interfere with the impugned order passed by the Tribunal. 18. According to us, no substantial question of law arises for our consideration. 19. The appeal is, accordingly, closed. 16. We find Hon'ble Patna High Court in the case of CIT vs. Nagendra Prasad (supra) has held that where notice was issued by the Assessing Officer under Section 148 requiring the assessee to file a return within thirty days but return was filed after eight and....