Nikita Kapoor Vs ITO (ITAT Delhi)
Reassessment Quashed for Non-Issue of 143(2) – Belated Return in 148 Proceedings Still Requires Mandatory Notice
The Delhi ITAT allowed the assessee’s appeal and quashed the entire reassessment for AY 2016-17 on the sole ground that no notice under Section 143(2) was issued after the assessee filed a return in response to notice under Section 148. The Tribunal held that even though the return was filed belatedly beyond the time mentioned in the 148 notice, once the return was filed before completion of assessment, it could not be treated as “non-est” and the Assessing Officer was statutorily bound to issue notice under Section 143(2).
The Tribunal rejected the AO’s action of proceeding under Section 144 by treating the return as invalid and held that non-issuance of 143(2) goes to the root of jurisdiction, rendering the reassessment void ab initio. Relying on binding precedents including Jai Shiv Shankar Traders (Delhi HC), Alpine Electronics (Delhi HC), Kamla Devi Sharma (Raj HC) and Balbir Singh (ITAT Raipur), it reaffirmed that issuance of 143(2) is mandatory in all cases where a return is filed pursuant to Section 148, whether timely or belated.
Since the reassessment itself was quashed for lack of jurisdiction, all additions relating to bogus LTCG under Section 68 and alleged commission under Section 69C were rendered academic and not adjudicated. The appeal was accordingly allowed in full.
