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2026 Supreme(Online)(ITAT) 7656
INCOME TAX APPELLATE TRIBUNAL (LUCKNOW BENCH)
Kul Bharat, Vice-President, Anadee Nath Misshra, Accountant Member
Arun Kumar Maurya – Appellant
Versus
Addl. Commissioner of Income Tax – Respondent
I.T.A. No.415/LKW/2023
Important Points
Subject
Taxation - Income Tax - Reassessment
Act Referred
Finance Act
Headnote
(B) Income Tax Act, 1961 - Section 292BB - Scope - Deeming provision cures only infirmities in service of notice where notice has emanated from department, not complete non-issuance of mandatory notice under section 143(2) which goes to root of jurisdiction. (Paras E.1.2, E.1)
Facts of the case:
Reassessment proceedings initiated under section 147 by notice dated 30.03.2021 under section 148 requiring return within 30 days. Return filed belatedly on 16.03.2022, intimated to AO on 17.03.2022. Assessment order passed on 19.03.2022 determining income without issuing notice under section 143(2). CIT(A) dismissed appeal. Additional ground raised before Tribunal regarding non-issuance of notice under section 143(2).
Findings of Court:
Assessment order annulled for failure to issue mandatory notice under section 143(2) after return filed and intimated; other grounds rendered academic.
Issues: Whether issuance and service of notice under section 143(2) is mandatory in reassessment proceedings post belated return filing under section 148, and whether section 292BB cures non-issuance.
Ratio Decidendi: Notice under section 143(2) mandatory to put assessee on notice for scrutiny; once return filed in response to section 148 (even belatedly), AO cannot disturb returned income without such notice; section 292BB inapplicable to absence of notice issuance.
Result: Appeal allowed; assessment order annulled.
For the Appellants/Petitioners: Samrat Chandra, C.A.
For the Respondents: R. K. Agarwal, CIT (D.R.)
ORDER
(A) This appeal vide I.T.A. No.415/LKW/2023 has been filed by the assessee for assessment year 2014-15 against impugned appellate order dated 28.11.2023 (DIN & Order No.ITBA/NFAC/S/250/2023- 24/1058283376(1) of Commissioner of Income Tax (Appeals) [“CIT(A)” for short].
(B) In this case, assessment order dated 19.03.2022 was passed by the Assessing Officer (“AO”, for short) proceedings u/s 147 of I.T. Act were initiated by issue of notice dated 30.03.2021; and whereby the assessee’s income was determined at Rs.4,40,89,200/-. The assessee’s appeal against the aforesaid assessment order was dismissed by the Ld. CIT(A) vide impugned appellate order dated 28.11.2023. The present appeal has been filed by the assessee against the aforesaid impugned appellate order dated 28.11.2023 of the Ld. CIT(A). The grounds of appeal are as under: -
“1. Because on the facts and in the circumstances of the case the order of Ld. CIT(A) as also Assessment is bad in law and deserves to be quashed being illegal.
2. Because on the facts and in the circumstances of the case the order of Ld. CTT(A) is bad in law in making addition U/s 69 without considering the submission of the assessee hence liable to be deleted.
3. Because on the facts and in the circumstances of the case the order of Ld. CIT(A) is bad in law since the Ld. AO illegally applied provisions of the amended section 56(2) (vii)(b) even before the amendment by The Finance Act 2013 to the assessee as section 56(2)(vii)(b) is not applicable to the assessee at the time of purchase of property in the FY 2013-14.
4. Because on the facts and in the circumstances of the case the order of Ld. CTT(A) is bad in law as the Assessing Officer has wrongly invoke the provision of Section 56(2)(vii) (b) of the Act and in sustaining the addition to the returned income of the Assessee and has further failed to mandatorily refer the valuation of the property as provided in the proviso to Section 56(vi) to the Valuation Officer as contemplated under Section 50C of the Act. Thus, the addition so sustained is wholly untenable in law and deserves to be deleted. An order of assessment without mandatorily referring the case to DVO is bad in law.
5. Because on the facts and in the circumstances of the case the order of Ld. CIT(A) has further erred in sustaining addition under Section 69 of the Act as unexplained investment, by arbitrarily rejecting an exhaustive, valid and legitimate explanation tendered by the assessee. The money invested by the assessee in purchase of property is recorded in its books of account and is evidenced through banking transactions, the money is sourced out of persons and entities. Thus, the addition has been sustained on material and whimsically.
6. Because, on the facts and in the circumstances of the case, the non-consideration of material available on record as also failure to refer the matter to DVO results in the assessment order being declared non-est being completely illegal the same deserves to be quashed.
7. Because, on the facts and in the circumstances of the case, without prejudice to the aforementioned grounds of appeal, the addition results in double taxation, as the same concern and are arising out of deeming fiction under law and accordingly it deserves to be telescoped.
8. Because on the facts and in the circumstance of the case, the order of Assessment has been passed in absolute violation of the principles of Natural Justice, without providing adequate opportunity of being heard and therefore deserves to be declared a nullity.
9. The appellant craves for leave to add, modify, amend or delete any other and further grounds of appeal with permission.”
(B.1) Further, a letter was filed from the assessee’s side on 25.07.2025 containing an additional ground of appeal. The relevant part of the aforesaid letter, containing additional ground of appeal is reproduced as under: -
“Because on the facts and in the circumstances of the case, the assessment order is illegal and bad in law, as
