Income Tax

Notice under section 143(2) is mandatory even if re-assessment proceeding is initiated under section 148

The ITAT Bangalore in the case of Shri GN. Mohan Raju vs. the Income tax Officer, 2014 (11) TMI 283, on 10Th November, 2014 dealt with the issue of requirement to issue notice under section 143(2) of the Income Tax Act in case of a notice under section 148 of the Act.
It was held that any issue of notice under section 143(3) of the Income Tax Act prior to that date cannot be considered as a notice on an income tax return filed by the assessee pursuant to a notice under section 148 of the Act.
It was further held that issue of a notice under section 143(2) of the Act is mandatory even if re-assessment proceeding is initiated as per 148 of the Act.
It has been laid down in Alpine Electronics Asia Ltd. vs. The Director General of income Tax, & others [2012 (1) TMI 100 –Delhi High Court] that Section 143(2) of the Act can also be applied to proceedings under section 148 of the Acct due to the reason that proviso to section 148 provides some particular liberties to the revenue regarding the extension of time for serving such notices.
It was been clearly stated that issue of notice under section 143(2) of the Act is not merely procedural in nature. On the contrary it is a mandatory requirement.

Facts of the case:

In the aforesaid case, a notice under section 143(2) of the Act was issued to the assessee. However on the date when it was issued that is on 23.9.2010 the assessee did not file any return pursuant to the reopening notice under section 148 of the Act.
In the judgment the Tribunal held that when the original income tax return filed by the assessee was subject to a processing under section 143(1), the assessment procedure pursuant to filing of the said return comes to an end, as the Assessing Officer did not issue any notice within a period of six months as has been mentioned in proviso to section 143(2) of the Act.
The Income Tax Act provides that if an assessee understates his income or in other words any income has escaped assessment, an assessing Officer has the power to issue notice under section 148 of the Act. When such notice is issued to the assessee, he is required it to file his return within 30 days from the date of receipt of the said notice. Issue of notice prior to that date is not considered as a notice on a return filed by the assessee pursuant a notice under section 148 of the Act. If no valid issue of notice is there under section 143(2) of the Act, the subsequent proceedings shall be all invalid.

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