Jain Shewatmber Sansthan Vs ITO (Exemption) (ITAT Jaipur)
Assessee is a society registered u/s 12A, running charitable activities including a free homeopathic clinic. No return was filed originally, but cash deposits of ₹12.33 lakh triggered reopening u/s 147. AO issued notice u/s 148, Assessee filed return belatedly, & assessment was completed u/s 147 r.w.s. 144 denying exemption u/s 11 by invoking s.13(1)(b). Additions of ₹9,04,499 were made towards Dev Dravya & Aradhana Bhawan receipts, & income was assessed at ₹10,50,970. CIT(A), NFAC sustained the additions.
Before Tribunal, the sole legal plea was that no notice u/s 143(2) was ever issued, rendering the assessment void. Although this ground was raised later by way of additional grounds before CIT(A), CIT(A) failed to consider or decide the request to admit the additional ground.
ITAT examined the record & found:
- There is no mention or evidence of any notice u/s 143(2) in the assessment order.
- CIT(A) ought to have adjudicated the legal ground or called for a Remand Report.
- Departmental DR also admitted that CIT(A) did not deal with the ground.
Tribunal relied on:
- PCIT v. Kamla Devi Sharma (Raj HC, 10.07.2018)
- Major Suresh Yadav (Del ITAT, 31.07.2023)
- Pr. CIT v. Jain Shiv Shankar Travels (Delhi HC) – failure to issue notice u/s 143(2) is fatal & not a curable defect.
Since issuance of notice u/s 143(2) is mandatory even in reopened assessments, Tribunal held the assessment as illegal & void ab initio.
