The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed the reassessment order on the grounds that the notice was not served on the assessee.
The bench of Challa Nagendra Prasad (Judicial Member) found that the department failed to prove proper service of the reassessment notice on the assessee.
The assessee/appellant challenged the order of the CIT (Appeals) on the ground of non-service of a notice issued under Section 148 of the Income Tax Act, 1961.
The assessee submitted that no notice under Section 148 of the Income Tax Act was served on the assessee and, therefore, in the absence of service of notice under Section 148, the reopening of the assessment is void ab initio and bad in law.
The assessee contended that there was no proof of service of notice under Section 148 of the Act on the record. During the course of first appellate proceedings, the CIT (A) sought a remand report from the Assessing Officer, but no report was submitted by the Assessing Officer. In the absence of service of mandatory notice, the whole assessment proceedings are vitiated in law and, consequently, the reassessment order passed under Section 144 read with Section 147 of the Act is bad in law.
The AO recorded a finding that the assessee had failed to make any compliance and, therefore, proceeded to complete the assessment under Section 147 read with Section 144 of the Act on December 11, 2018, determining the income of the assessee at Rs.12,58,253.
The assessee contended before the CIT (A) that notice under section 148 was not served. However, the CIT (A) simply rejected the objections raised by the assessee, stating that the assumption of jurisdiction under section 147 and the issue of notice under section 148 have no force as the AO has very specifically mentioned in the assessment order that the notice was served on the assessee. The CIT (A) proceeded to adjudicate the appeal on merits and decided against the assessee.
The ITAT allowed the appeal of the assessee and quashed the reassessment order.
Case Title: Abhinav Sehgal Versus ITO
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