Baba Hi-Tech Pvt. Ltd. Vs ACIT (ITAT Kolkata)
Facts
- Assessee filed appeal against order of CIT(A).
- At ITAT stage, assessee raised an additional legal ground that the notice issued u/s 143(2) dated 27.06.2022 was invalid as it did not comply with CBDT Instruction F.No.225/157/2017/ITA-II dated 23.06.2017.
- The impugned notice merely mentioned “computer aided scrutiny” but failed to specify whether it was limited, complete, or compulsory manual scrutiny.
Assessee’s Arguments
- Defect in notice goes to root of jurisdiction; assessment framed u/s 143(3) on 27.12.2022 is void ab initio.
- Legal ground can be raised for first time before appellate authority (SC rulings in Jute Corporation of India & NTPC; Cal HC in Britannia Industries Ltd.).
- Relied on ITAT Kolkata in Tapas Kumar Das Vs ITO (11.03.2025) & Shib Nath Ghosh Vs ITO (29.11.2024) where similar invalid notices u/s 143(2) were held void.
Revenue’s Stand
- Non-mention of limited/complete scrutiny in a computer-generated notice is a minor defect; notice should not be invalidated.
- Issue was not raised before lower authorities.
Tribunal’s Observations/Decision
- CBDT instruction requires notices u/s 143(2) to be in one of three prescribed formats (limited, complete, or compulsory manual scrutiny).
- The present notice did not conform; it only stated “computer aided scrutiny”.
- Instructions issued u/s 119 are binding on tax authorities (SC in UCO Bank).
- Following coordinate bench rulings (Tapas Kumar Das, Shib Nath Ghosh), such defective notice is invalid & renders consequential assessment invalid.
- ITAT held the notice u/s 143(2) dated 27.06.2022 invalid.
- Consequently, assessment order u/s 143(3) dated 27.12.2022 was quashed.
- Assessee’s appeal allowed on legal ground; other grounds left open.
If notice u/s 143(2) is not issued in prescribed format as per CBDT instruction, entire assessment becomes void. Legal ground can be raised even for first time before ITAT.
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