Reassessment proceedings invalid if officer issuing notice & recording reasons are different

Pankajbhai Jaysukhlal Shah C/O. Meena Agency Ltd. Vs ACIT (Gujarat High Court)

It is the officer who records the reasons who has to issue the notice under section 148(1) of the Act whereas in the present case the reasons have been recorded by the jurisdictional Assessing Officer, whereas the notice under section 148(1) of the Act has been issued by an officer who did not have jurisdiction over the petitioner. Since the notice under section 148 of the Act is a jurisdictional notice, any inherent defect therein cannot be cured under section 292B of the Act. A notice under section 148(1) of the Act would be a valid notice if the jurisdictional Assessing Officer records the reasons for reopening the assessment as contemplated under sub-section (2) of section 148 and thereafter the same officer namely the jurisdictional Assessing Officer issues the notice under section 148(1) of the Act. In the facts of the present case, while the reasons for reopening the assessment have been recorded by the jurisdictional Assessing Officer viz. the Deputy Commissioner of Income­ tax, Circle­ 2, Jamnagar, the impugned notice under section 148(1) of the Act has been issued by the Income Tax Officer, Ward 2(2), Jamnagar who had no jurisdiction over the petitioner, and hence, such notice was bad on the count of having been issued by an officer who had not authority in law to issue such notice. As a necessary corollary it follows that no proceedings could have been taken under section 147 of the Act in pursuance of such invalid notice. In the aforesaid premises, the impugned notice under section 148(1) of the Act as well as all the proceedings taken pursuant thereto cannot be sustained.

FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT

1. Rule Mrs. Mauna Bhatt, learned senior standing counsel waives service of notice of rule on behalf of the respondents.

2. Having regard to the controversy involved in the present case, which lies in a narrow compass and with the consent of the learned advocates for the respective parties, the matter was taken up for final hearing today.

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