Ashok Kumar Tewari Vs ITO (ITAT Delhi)
Delhi ITAT Quashes Reassessment for Failure to Issue Mandatory Notice under Section 143(2)
The Delhi Bench of the ITAT quashed a reassessment order passed under sections 147 read with 144 for AY 2016-17, holding that the failure to issue a mandatory notice under section 143(2) rendered the reassessment void for want of jurisdiction.
The assessee contended that after issuance of notice under section 148, the Assessing Officer issued only notices under section 142(1) and never issued a notice under section 143(2). The Revenue argued that the assessment had been completed under section 144 due to non-compliance by the assessee and that this objection had not been specifically raised before the CIT(A).
The Tribunal examined the e-proceedings record and found that while notice under section 148 had been served, only notices u/s 142(1) were thereafter issued. There was no evidence that a notice u/s 143(2) had ever been issued. It held that the assessee’s general ground challenging the legality of the reassessment was sufficient to encompass this jurisdictional issue.
The ITAT further observed that the Assessing Officer had taken cognizance of the original return filed by the assessee and processed u/s 143(1). Since the reassessment involved making additions over and above the returned income, issuance of notice u/s 143(2) was mandatory. The fact that the assessment was ultimately completed u/s 144 did not dispense with this statutory requirement, as the defect went to the very assumption of jurisdiction.
Relying on the Supreme Court’s decision in ACIT v. Hotel Blue Moon, the Tribunal held that the absence of a notice u/s 143(2) vitiated the reassessment proceedings. Consequently, it allowed the appeal and quashed the reassessment order.
Cases Discussed
- ACIT v. Hotel Blue Moon (SC), 321 ITR 362
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal is preferred by the assessee against the order dated 14.11.2025 of the Ld. National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in DIN & Order No: ITBA/NFAC/S/250/2025-26/1082627880(1) arising out of the assessment order dated 24.03.2023 u/s 147 r.w.s 144 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by National Faceless Assessment Centre, for AY: 2016-17.
2. On hearing both sides we find that primary contention of ld. Counsel for the assesse is that without serving a mandatory notice u/s 143(2) of the Act the assessment has been completed. This has been countered by ld. DR by submitting that this ground was not raised before ld. CIT(A) and before the Tribunal also this ground is not taken specifically. It was also submitted that assessment has been completed u/s 144 of the Act and there was complete non-compliance on part of assesse. Written submissions were also filed by ld. DR, however, with regard to this issue there is no factual assertion that notice u/s 143(2) of the Act, was actually issued.
3. After taking into consideration the submissions and the material on record we find that at page Nos. 30-32 assessee has provided screen shots of the e-proceedings and the same reflect that notice u/s 148 was served on 29.07.2022 and thereafter notice u/s 142(1) were only issued, thus non issuance of notice u/s 143(2) is established. We are of the considered view that ground No. 1 being a general ground wherein initiation of proceedings passing of order u/s 147 of the Act has been alleged to be illegal and voidab-initio sufficiently covers the contentions as raised.
4. Now from the assessment order it is very clear that ld. AO has considered the return filed by the assessee and processed u/s 143(1) of the Act, to make the computation of income. Thus ld. AO was very much aware of the return of assessee filed on 17.10.2016 being there. In, the reopening proceedings took, ld. AO has taken cognizance of same return. Thus it was essential for ld. AO to have issued the notice u.s 143(2) of the Act, to sustain the additions, over and above the returned income, on the basis of material relied during the assessment proceedings. It hardly make difference that assessment was concluded u/s 144 of the Act, as the challenge is of the assumption ofjurisdiction, for re-assessment, without there being notice u/s 143(2) of the Act. Reliance placed by assessee on the decision of Hon’ble Supreme Court in ACIT Versus Blue Moon 321 ITR 362 (SC) is squarely applicable.
5. Thus the ground no. 1 is sustained and appeal is allowed. The impugned order is quashed.
Order pronounced in the open court on 05.08.2026.
