July 2019

Section 143 r.w.s. 148 Failure to issue notice u/s. 143(2) of the Act after the assessee files the return of income renders the re-assessment order illegal and invalid

Jagdish T.Punjabi|Devendra Jain | Tejaswini Ghag
Chartered Accountants

18 [2019] 105 taxmann.com 118 (Pune) ITO (Exemptions) vs. S. M. Batha Education Trust ITA No. 2908/Pun/2016 A.Y.: 2012-13 Date of order: 4th April, 2019

 

Section 143 r.w.s. 148 Failure to issue notice u/s. 143(2) of the Act after the assessee files the return of income renders the re-assessment order illegal and invalid

 

FACTS

The AO issued a notice u/s. 148 of the Act dated 29th September, 2014 to the assessee, a trust engaged in educational activities. The assessee neither replied to the notice nor filed its return of income. Thereafter,
the AO issued two separate notices u/s. 143(2) of the Act on 29th April, 2015 and 1st July, 2015. Subsequently, the assessee filed the return of income on 21st October, 2015.

 

The AO completed the assessment and passed a reassessment order. Aggrieved, the assessee preferred an appeal to the CIT(A).

 

Revenue also preferred an appeal to the Tribunal. The assessee filed cross-objections challenging the re-assessment proceedings to be bad in law since no statutory notice u/s. 143(2) was issued by the AO after the assessee filed the return of income. The Tribunal decided this jurisdictional issue.

HELD

The Tribunal held that the AO is required to issue statutory notice u/s. 143(2) of the Act after the assessee files the return of income in response to notice issued u/s. 148 of the Act. In the absence of such a statutory notice after return of income is filed by the assessee, the re-assessment order made by the AO was held to be invalid and illegal.

 

The Tribunal dismissed the appeal filed by Revenue and allowed this ground raised by the assessee in its cross-objections.

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