Gautam Kumar Sadhu Vs ACIT (ITAT Kolkata)
This case goes to the root of jurisdiction & demonstrates how an invalid or improper notice u/s 143(2) renders the entire assessment void. Assessee’s appeal reached Tribunal with a delay of 352 days, which he explained by stating that CIT(A) never issued notices to his registered e-mail, & he only discovered the order after inquiring with AO. Tribunal found the cause bona fide condoned the delay in the interest of justice.
Assessee then challenged the assessment on two strong legal grounds:
No valid notice under Section 143(2)
The only 143(2) notice issued (dated 14.09.2018) merely stated “Computer Aided Scrutiny Selection”, but did not specify whether the scrutiny was Limited, Complete, or Manual, as mandated by CBDT Instruction F.No.225/157/2017/ITA-II dated 23.06.2017. ITAT noted that CBDT instructions issued u/s 119 are binding on tax authorities (as held by the Supreme Court in UCO Bank). Therefore, the 143(2) notice was invalid, & all consequential proceedings were void ab initio.
Notice issued by wrong officer – violates pecuniary jurisdiction
The notice u/s 143(2) was issued by ITO Ward 24(3), but the assessment was completed by ACIT Circle 24(1). As per CBDT Instruction No.1/2011 (31.01.2011):
- ITOs can assess cases up to ₹15 lakhs (in mofussil areas)
- ACIT/DCIT can assess above ₹15 lakhs
Assessee’s returned income was only ₹10.41 lakh, so only ITO had jurisdiction, not ACIT.
