Shilpi Sardana Vs DCIT (ITAT Delhi)
ITAT Delhi quashed the assessment framed for AY 2021-22, holding that the notice issued u/s 143(2) was not in the CBDT-mandated format & hence invalid.
Assessee had challenged the validity of assessment on multiple grounds, including limitation, non-existence of DIN & additions based only on WhatsApp chats. An additional legal ground was also sought: that the scrutiny notice dated 30.06.2022 was issued in violation of CBDT Instruction F.No.225/157/2017/ITA-II dated 23.06.2017, which prescribes mandatory formats for limited, complete & manual scrutiny.
Assessee’s argued that Notice u/s 143(2) was not in prescribed format, failing to specify whether scrutiny was limited, complete, or compulsory manual. CBDT instructions issued u/s 119 are binding on all tax authorities. Reliance placed on UCO Bank (237 ITR 889, SC) & Back Office IT Solutions (Del HC 2021). Multiple ITAT benches (Delhi, Kolkata) had already quashed assessments on identical defects – including Anita Garg (ITA 4053/Del/2024), Ankur Dealcom Pvt Ltd (ITA 197/Kol/2025), Hind Ceramics Pvt Ltd (ITA 608 & 610/Kol/2024), Tapas Kumar Das (ITA 1660/Kol/2024), & Sajal Biswas (ITA 1244/Kol/2023).
Tribunal noted that the defect was not disputed by Revenue – notice indeed was not in prescribed format. Following consistent judicial precedent, ITAT held that a notice u/s 143(2) issued contrary to CBDT instruction is jurisdictionally defective, rendering the entire assessment void ab initio. Once assessment itself is quashed, other grounds including cash addition of ₹1.77 crore based on WhatsApp chats became academic.
