Reassessment proceedings without service of notice u/s 148 is void ab initio

The issue in this appeal of the assessee is regard to the non-service of notice issued u/s 148 of the Income Tax Act, 1961 (the Act).

In this matter, notice u/s 148 was said to have been issued on 28.03.2018. Similarly notice u/s 142(1) was said to have been issued on 9.10.2018 fixing the date of compliance as 15.10.2018 and again on 22.11.2018 fixing the date of compliance as 28.11.2018 along with questionnaire. The AO recorded a finding that assessee has failed to make any compliance and, therefore, proceeded to complete the assessment under Section 147 read with section 144 of the Act on 11.12.2018 determining the income of the assessee at Rs.12,58,253/-.

On appeal the Ld. CIT(A) sustained the same. Before the ld. CIT(A) the assessee contended that notice u/s 148 was not served. However, the Ld. CIT(A) simply rejected the objections raised by the assessee stating that assumption of jurisdiction u/s 147 and issue of notice u/s 148 has no force as the AO has very specifically mentioned in the assessment order that the said notice was served on the assessee. The Ld. CIT(A) proceeded to adjudicate the appeal on merits and decided against the assessee. It is the contention of the Ld. Counsel for the assessee that no notice u/s 148 has been served which submission has not been controverted by the Ld. DR with evidences.

ITAT in its order relied on the order given by the Hon’ble Delhi High Court in the case of CIT Vs. Chetan Gupta (382 ITR 613), wherein the Hon’ble High Court held that where notice u/s 148 was not served on the assessee in accordance with law the reassessment made consequent thereto was without jurisdiction and liable to be quashed. In the case on hand as the Revenue could not prove the service of notice u/s 148 on the assessee in accordance with law the re-assessment made u/s 147 read with section 144 pursuant to such notice is void ab initio and bad in law. Hence, the reassessment order dated 11.12.2018 made u/s 144 read with section 147 is quashed.

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