Issue and service of notice u/s 148 within the time limit of section 149 and other important factors has to be kept in mind while doing so , otherwise , the Income tax Act , 1961 is so scientific that the entire exercise of the revenue is washed in the hands of the asseesee and higher courts and the counsel of the asseesee too . Due care has to be made before issue and service of notice u/s 148 by the revenue.
After issue and service of notice it has to be examined telescopically by the asseesee, his counsel and even courts what benefit can be derived from the technical mistakes done by revenue at the time and before issue of the notice . Following are the few famous judgement of the courts which give the light on this important section of the Act .
| S. NO. | SERVICE OF NOTICE | PARTICULARS | COURT JUDGEMENT |
| 1 | Service of notice under section 148 is mandatory. | Issue and service of notice under section 148 is is a precondition for a valid assessment proceedings . It was held that where Service of notice u/s 148 is mandatory | The asseesee was not served with the notice u/s 148 , the proceedings were void . CIT Vs. Harish Punjabi (2008) 297 ITR 424 (Del) . |
| 2 | Service of notice u/s 148 is not merely a procedural requirement but a condition precedent to the validity of assessment. | inquiries were made by the assessing officer as to the whereabouts of the respondent, and only thereafter, a notice was served by affixing. | CIT V/s Thayaballi mullah jeevaji Kapasi 66 ITR 147 (SC) |
| 3 | Service of the notice on the asseesee is a condition precedent to the validity of any reassessment. | If the notice u/s 148 is served on the asseesee that the ITO would be justified in taking proceedings against the asseesee. If no notice is issued or if the notice issued is shown to be invalid, then the proceedings taken by the ITO would be illegal and void. | CIT V/s Kurabn Hussain Ibrahimji9 Mithiborwal (1971) 82 ITR 821 (SC) |
| 4 | Service of the requisite notice on the asseesee is a condition precedent to the validity of any re-assessment. | The notice prescribed by section 148 of the Income tax act 1961 cannot be regarded as a mere procedural requirement. It is only if the said notice is served on the asseesee as required that the Income Tax Officer would be justified in taking proceedings against him. | Sewlal Daga v. CIT (1965) 55 406 (Cal.) |
| 5 | Service of the notice for the purpose of commencing proceedings for re-assessment , is not a mere procedural requirement. | If no notice is issued or if the notice issued is shown to be invalid, then the proceedings taken by the income tax officer, without a notice or in pursuance of an invalid notice , would be illegal and void. | Y. Narayan Chetty v. ITO (1959) 35 ITR 388 (SC) |
| 6 | Prior to Re-opening of assessment, Notice U/s 148 must be issued and served upon the asseesee. | NO notice u/s 148 having being served on the asseesee prior to reopening of assessment. Assessment made u/s 147 was bad in law, argument based on sec. 292BB was not sustainable on the facts of the case | CIT v. Mani Kakkar (2009) 18 DTR 145 (Del.) |
| 7 | Notice u/s 148 must be issued and served. | Notice u/s 148 is the foundation of jurisdiction. If there is any defect of material nature, any proceedings based on such notice itself would be invalid. U/s 148(1), service of a valid notice requiring the asseesee to furnish the return of income is a condition precedent to the validity of re-assessment. Service of notice prescribed u/s 148 for the purpose of commencing proceedings for re-assessment is not a mere procedural requirement.It is a condition precent for the initiation of proceedings for assessment u/s 147. If no notice is issued and served or if the notice issued and served is shown to be invalid, then the proceedings taken by the assessing officer without a notice issued and served on in pursuance of a invalid notice would be illegal and void. The proceedings of re-assessment are commenced on the issue of a notice u/s 148. This notice is not a mere procedural requirement. Where no notice was served u/s 148 the appearance of a person in response to a notice u/s 142(1) could not be deemed to be the knowledge of proceedings u/s 147 | CIT v.Manta Kalita (2002) 253 ITR 334 : (2001) 117 Taxman 388 (Gauhati) |
| 8 | Participation by an asseesee in assessment proceedings on receipt of copy of notice can be deemed to be service of notice u/s 148(1). | When asseeseee does not raise objection regarding non issue of notice and appears before the Assessing Officer and Assessing officer gives copy of notice u/s 148, Asseeseee participates in the Assessment proceedings . The service of notice even at the old address of the asseesee constitutes service of notice within ambit of section 148. What is contemplated u/s 149 is the issue of notice under section 148 and not the service thereof on the asseesee and the service of the notice u/s 148 is only required before assessment, reassessment or re computation . | CIT v. Three Dee Exim (P) Ltd. (2012) 20 taxman 146: (2011) 55 DTR 147 (del) |
| 9 | Notice issued by non-jurisdictional assessing officer is invalid. | Notice to be issued by the assessing officer having jurisdiction over the asseesee at the time of issue of requisite notice. | CIT v. Shaporji Pallonji Mistry (1962) 44 ITR 891 (sc) |
| 10 | Reassessment order Invalid due to want of notice u/s 143 (2). | It is mandatory for the assessing officer to issue notice u/s 143(2). The issuance and service of notice u/s 143(2) is mandatory and not procedural. If the notice is not served within the prescribed period, the assessment order in invalid. | ACIT & Anr. V. Hotel Blue Moon (2010) 321` ITR 362 (SC) |
| 11 | Reassessment is null and void where notice u/s 148 is not served on ALL legal hiers of the deceased asseesee, but only on some of the legal heirs. | As far as reassessment under section 148 is concerned, service of notice on ONE of the legal representatives is not adequate and is essential for the revenue to serve separate notices on EACH of the legal representatives in order to make a valid reassessment, failing which the action of reassessment would be void. | ACIT v. Late Mangilal through L/H Badri prasad Bhatia (2004) 23 CCH 10 jodh.-Trib |
| 12 | Asseesee cannot waive his right to a notice under section 148. | Where notice is not issued but the asseesee cooperates in the reassessment, the reassessment would still be invalid. The asseesee cannot waive his right to a notice u/s 148 as such notice is a condition precedent for the exercise of the jurisdiction by the Assessing Officer to assess or reassess u/s 147. | Tansukrai Bodulal v. ITO (1962) 46 ITR 325 (Assam) |
| 13 | Procedure when defendant refuses to accept service , or cannot be found. | Where the defendant/ agent/ such other person as aforesaid refuses to sign the acknowledgement, or where the serving officer, after using all due and reasonable diligence, cannot find the defendant, who is absent from his residence at the time when the service is sought to be effected on him on his residence and there is no likelihood of being found at the residence within a reasonable time and there is no agent empowered to accept service of the summons on this behalf, nor any other person on whom the service can be mad, the serving officer shall affix a copy of the summons on the OUTER DOOR or some other conspicious part of the house in which the defendant ordinarily resides or carries on business or personally works for gain, and shall then return the original to the court from which it was issued, with a report endorsed thereon or annexed thereto stating that he has so affixed the copy, the circumstances under which he did so, and the name and address of the person(if any) by whom the house was identified and in whose presence the copy was affixed. | Order V, Rule 17 of Code of Civil Procedure 1908 |
| 14 | Service on notice on COUNSEL authorised to receive all documents is considered as a valid service. | The asseeseee’s counsel who duly authorised to receive all documents on behalf of the asseeseee, received the certified copy of the order of the Tribunal, which was passed it o to another counsel of the asseeseee from whome the asseeseee collected the certified copy of order. On appeal to he High Court with an application of condonation of delay, in filing the appeal, contending that certified copy of the order of the tribunal was not served by the asseeseee by the office of the Tribunal in accordance with the rule 35 of the Income Tax (Appealate Tribunal) Rules, 1963.The court held that the phrase “Received by the asseeseee” means received by the asseeseee either himself or through his authorised agent. The counsel was empowered to accept the copy of the order of the tribunal and hence the service on him was valid service for the purposes of calculation of limitation of filing an appeal.Thus, the appeal filed by asseeseee was barred by limitation.(A.Yr. 1997-98) | Sultanpur Kshetriya Gramin Bank v. JCIT (2011) 336 ITR 156 (All.) |
| 15 | Obligation of asseeseee on receiving notice under section 148. | On receipt of notice u/s 148 the asseeseee is required to file a FRESH RETURN.In case, the asseeseee feels that the earlier return filed by him u/s 139 should be treated as the return for purpose of sections 147 & 148, he may inform the assessing officer of his decision. In that event, the earlier return will be treated as the fresh return submitted in reponse to the notice u/s 148. | Kanhaiya Lal Tiwari v. CIT (1985) 154 ITR |
| 16 | When assessment has been completed by one officer, issue of notice u/s148 by another officer at a different place in absence of order u/s127 would be invalid. | An assessment made by an assessing officer cannot be reopened by another Assessing Officer In the absence of an order of transfer of the case by a competent authority in exercise of jurisdiction under section 127. Assessment concluded by Assessing Officer at Pune reopened by Assessing Officer at Jallandhar is, without jurisdiction in absence of order under section 127 | Paramjeet Singh v. CIT $ Anr. (1996) 220 ITR 446 : 135 CTR 8 (P & H) |
Don’t forget to check section 148 of income tax act.
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Sandeep,
You deserve compliments for bringing all Landmark Judgements on various issues wrt Section 148 of the Income Tax Act at one place. Its really helpfull to all.