SAGAR BAHUBALI JOLAPURE,DAVOROLIM, SALCETE, GOA vs. INCOME TAX OFFICER, WARD 1, THE OFFICE OF ITO, MARGAO GOA

PER VINAY BHAMORE, JM: This appeal filed by the assessee is directed against the order dated 01.08.2025 passed by Ld. CIT(A)/NFAC for the assessment year 2018-19. 2. The appellant has raised the following grounds of appeal :-

“1) The order of the CIT(A) is bad in law and is void-ab-initio.

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2) The Assessment Order passed by the ld AO u/s 147 r.w.s 144 r.w.s 144B of the Income Tax Act, 1961, and sustained by the CIT(A) is without jurisdiction, misconceived and without following the principles of natural justice. 3) The order passed by the ld AO is without jurisdiction as the notice issued u/s 148 of the Income Tax Act, was issued by the jurisdictional assessing officer (JAO) and not by the faceless assessing officer (FAO) who has passed the order. 4) The re-opening of the assessment u/s 147 of the IT Act, is bad in law, as the AO has not considered section 139 return filed by the appellant while deciding on the re-opening of the case. 5) The ld AO has erred in considering Rs.17,21,292/- as income from other sources without looking into the facts of the case. 6) With these and such other grounds that may be urged at the time of hearing the appellant prays for relief sought for.”

“That the Order of Assessment passed u/s 147 r.w.s. 144B of the Income-tax Act, 1961 is invalid, as no Notice under Section 143(2) of the Income-tax Act, 1961 was issued to the assessee, although the assessee had duly filed their Return of Income in response to the Notice issued under Section 148 of the Income-tax Act, 1961.”

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On the basis of information that the assessee has earned interest income of Rs.16,97,482/- on fixed deposits and also earned savings bank account interest from HDFC Bank and ICICI Bank of Rs.14,331/- and Rs.7,502/- respectively, however, failed to disclose above interest income for taxation since only income of Rs.2,98,685/- was disclosed under the head ‘Income from other sources’, therefore, the case of the assessee was reopened u/s 147 and notice u/s 148 of the IT Act was issued to the assessee. The assessee filed return in response to above notice on 25-09-2021. Subsequently, notices u/s 142(1) of the IT Act and show cause notices u/s 144 respectively were issued to the assessee. The assessee did not comply with any of the above notices, therefore, the Assessing Officer vide order dated 28.09.2021 completed the assessment proceedings u/s 147 r.w.s. 144 r.w.s. 144B of the IT Act by determining the income of the assessee at Rs.20,19,980/- as against income of Rs.2,98,690/- returned by the assessee in original return of income. The above assessed income includes

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addition of Rs.17,21,292/- being undisclosed bank interest income. 5. Being aggrieved with the above assessment order, the assessee preferred an appeal before Ld. CIT(A)/NFAC. Not being satisfied with the reply and submissions of the assessee, Ld. CIT(A)/NFAC dismissed the appeal filed by the assessee. 6. It is the above order against which the assessee is in appeal before this Tribunal. 7. We have heard Ld. Counsels from both the sides and perused the material available on record including the copy of case laws & paper book furnished by the assessee. In this regard, we find that it is the sole contention of the counsel of the assessee that the mandatory notice required u/s 143(2) of the IT Act was not issued by the Assessing Officer, therefore, the reassessment order passed by the Assessing Officer is without jurisdiction & deserves to declared as bad in law. In this regard, it is the contention of the counsel of the assessee that the return in

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response to notice u/s 148 of the IT Act was furnished by the assessee on 25-09-2021, however the Assessing Officer failed to take cognizance of this return of income & consequently by treating that no return is filed in response to notice u/s 148 of the IT Act did not issue notice u/s 143(2) of the IT Act. In this regard, we find that the assessee has produced copy of ITR-V duly e-verified, along with that the assessee has also furnished screen shot of income tax e-filing portal, from the perusal of which it is evident that notices u/s 142(1) and show cause notices u/s 144 of the IT Act were only issued and no notice u/s 143(2) of the IT Act was issued on the income tax portal. Ld. DR also could not bring any adverse fact on record to rebut the contention of the assessee in this regard. 8. We find that under identical facts similar issue has already been decided by a coordinate bench of this Tribunal in the case of Kamlesh Pramod Gandhi vs. ITO in ITA No.1567/PUN/2026 order dated 07.07.2025 wherein the Tribunal followed the

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judgement of Hon’ble High Court of Patna in the case of Commissioner of Income-tax - 11 vs. Nagendra Prasad [2023] 156 taxmann.com 19 (Patna) [02-08-2023] and held the assessment order invalid which was passed without issue of notice u/s 143(2) of the IT Act by observing as under :-

“6. So far as the validity of the order in absence of issue of notice u/s 143(2) is concerned, he held that the return in response to the notice u/s 148 has been treated as invalid return by the system. Therefore, once the return itself is treated as invalid, the Assessing Officer was justified in proceeding with the re-assessment by issuing notice u/s 142(1) of the Act. He held that the issuance of notice u/s 143(2) pre-supposes a valid return which was absent in the present case. Therefore, non-issue of notice u/s 143(2) of the Act does not vitiate the re-assessment proceedings. 7. So far as the merit of the case is concerned, he held that the assessee was unable to discharge the burden cast on him. The assessee in the instant case failed to produce the primary evidences such as sale bills, vouchers, stock registers or VAT returns to substantiate the sales corresponding to the specific dates and amounts of the cash deposits. Without a verifiable trail linking the cash deposits to specific commercial transactions, the claim of business sales remains a bald assertion. He accordingly upheld the addition on merit also. 8. Aggrieved with such order of the Ld. CIT(A) / NFAC the assessee is in appeal before the Tribunal. 9. The Ld. Counsel for the assessee at the outset submitted that the assessee in response to the notice u/s 148 of the Act dated 31.03.2021 filed its return of income on 27.01.2022 which was subsequently e-verified on 02.03.2022 which is evident from the screenshot of the return filed on income tax portal, copy of which is placed at pages 5 to 8 of the paper book. Therefore, the finding of

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the Ld. CIT(A) / NFAC that the return was treated as invalid by the system is incorrect. He submitted that a return which has been e- verified and is appearing as filed return on the income tax portal cannot be characterized as invalid return. He submitted that it is an undisputed fact that no notice u/s 143(2) of the Act was ever issued by the Assessing Officer after filing of the return in response to the notice u/s 148 of the Act. He has only issued notice u/s 142(1) of the Act. Relying on the decision of the Hon’ble Patna High Court in the case of CIT vs. Nagendra Prasad reported in (2023) 156 taxmann.com 19 (Patna), he submitted that the Hon’ble High Court in the said decision has held that where notice was issued by the Assessing Officer under section 148 requiring the assessee to file a return within thirty days but return was filed after eight and a half months, since return was filed by the assessee in response to the said notice though delayed, there should have been a notice issued under section 143(2) as requirement to issue notice could not be dispensed with. 10. Referring to the decision of the Co-ordinate Bench of the Tribunal in the case of Bababhai Sadarbhai Shaikh vs. ITO vide ITA No.144/PUN/2025 order dated 23.10.2025 for assessment year 2015-16, he submitted that in that case also notice u/s 148 of the Act was issued on 31.03.2021 and the assessee vide letter dated 14.03.2022 requested the Assessing Officer to consider the original return as return filed in response to notice u/s 148. Since no notice u/s 143(2) of the Act was issued, the Tribunal, following the decision of the Hon’ble Patna High Court in the case of CIT vs. Nagendra Prasad (supra), held that there should have been a notice issued u/s 143(2) which is a requirement and which cannot be dispensed with. 11. Referring to the decision of the Co-ordinate Bench of the Tribunal in the case of Bharat Kantilal Chengede vs. ITO vide ITA No.1902/PUN/2025 order dated 13.01.2026 for assessment year 2012-13, he submitted that in that case also notice u/s 148 was issued on 25.03.2019 and the assessee filed his return in response to the said notice on 11.12.2019 which is after the statutory period of 30 days given by the Assessing Officer. The notice u/s 143(2) was not issued and the assessment order was passed on 20.12.2019. When the assessee challenged the assessment in absence of notice u/s 143(2), the Tribunal, following various decisions held that the

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failure by the Assessing Officer to issue notice to the assessee u/s 143(2) after the assessee filed his return in response to the notice u/s 148 is fatal to the order of re-assessment. Relying on various other decisions, he submitted that since admittedly the Assessing Officer has not issued notice u/s 143(2) after the assessee filed return in response to the notice u/s 148, though, belatedly, such assessment order is invalid being not in accordance with law. 12. The Ld. DR on the other hand submitted that the assessment record and assessment order clearly indicate that the return filed in response to the notice u/s 148 was not accepted by the system as a valid return and was reflected as an invalid return. The Assessing Officer has specified this fact in the assessment order. Therefore, there is no requirement of issue of notice u/s 143(2). 13. So far as the contention of the assessee that the return subsequently stood e-verified on 02.03.2022 is concerned, he submitted that the matter requirs verification from the assessment record. He submitted that mere production of a screenshot at the appellate stage cannot automatically displace the contemporaneous record relied upon by the Assessing Officer while framing the assessment. He submitted that this screenshot or the fact that the return subsequently stood e-verified was not on the record of the file of the Ld. DR. 14. So far as the various decisions relied on by the Ld. Counsel for the assessee are concerned, he submitted that these decisions are distinguishable and not applicable to the facts of the present case. In all these cases, there existed a valid return on record and the Hon’ble Courts found complete absence of notice u/s 143(2) despite such valid return. However, in the present case, the assessment order itself records that the return filed in response to notice u/s 148 was treated as invalid by the system and the re-assessment proceedings were continued through statutory notices u/s 142(1). 15. Without prejudice to the above, the Ld. DR submitted that the matter may be restored to the file of the Assessing Officer for examination of the assessment records and portal records regarding the exact status, date of validation and processing of the return purportedly filed in response to the notice u/s 148 of the Act. Further, the assessee has not challenged the validity of reopening on merits before the Tribunal. He submitted that the reopening was

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based on specific information relating to substantial cash deposits and therefore, re-assessment proceedings were initiated on a valid foundation. He accordingly submitted that the order of the Ld. CIT(A) / NFAC be upheld and the grounds raised by the assessee be dismissed. 16. We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. The only issue to be decided in the instant appeal is regarding the validity of assessment in absence of issue of notice u/s 143(2) of the Act. It is an admitted fact that the Assessing Officer in the instant case issued notice u/s 148 on 31.03.2021. It is also an admitted fact that the assessee filed its return of income in response to the notice u/s 148 of the Act on 27.01.2022. It is also an admitted fact that no notice u/s 143(2) was issued to the assessee. It is also an admitted fact that the Assessing Officer passed the order on 25.03.2022 u/s 147 r.w.s. 144B of the Act. Under these circumstances, we have to see as to whether the assessment order can be held as null and void in absence of any notice u/s 143(2). 17. It is the submission of the Ld. DR that since the return was treated as invalid by the system, therefore, there was no valid return filed and therefore, there was no requirement of issuing any notice u/s 143(2). However, a perusal of the assessment order shows that the Assessing Officer has proceeded to compute the income on the basis of the return filed in response to the notice u/s 148 by observing as under:

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“14. We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the Assessing Officer in the instant case issued notice u/s 148 of the Act on 25.03.2019. We find the assessee in the instant case filed his return of income on 11.12.2019 which is after the statutory period of 30 days given by the Assessing Officer. It is also an admitted fact that the assessment order was passed on 20.12.2019 and no notice u/s 143(2) of the Act has been issued and served on the assessee before completion of the assessment. Under these circumstances, we have to see as to whether non-issue of notice u/s 143(2) of the Act renders the assessment proceedings invalid when the assessee filed the return in response to the notice issued u/s 148 of the Act belatedly. 15. We find an identical issue had come up before the Hon’ble Delhi High Court in the case of PCIT vs. Draft Infrabuild (P.) Ltd. (supra). We find the Hon’ble High Court, following its earlier order in the case of PCIT vs. Shri Jai Shiv Shankar Traders (P.) Ltd. (supra) and various other decisions, has held that the failure by the Assessing Officer to issue a notice to the assessee u/s 143(2) of the Act after the assessee files his return of income in response to the notice u/s 148 of the Act is fatal to the order of re-assessment proceedings. The relevant observations of Hon’ble High Court read as under:

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“4. The only question of law arising in the facts and circumstances of the case is whether notice should have been issued under section 143(2) of the Income-tax Act?

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adopted. Since the Assessing Officer in the instant case has admittedly not issued any notice u/s 143(2) of the Act after the assessee filed the return in response to the notice u/s 148 of the Act, though, belatedly, therefore, respectfully following the decisions cited (supra), we hold that the order passed by the Assessing Officer without following the mandatory requirement of issue of notice u/s 143(2) of the Act makes such re-assessment order a nullity. Since the assessee succeeds on this legal ground, the grounds challenging the addition on merit are not being adjudicated.” 22. Since the facts of the in the instant case are identical to the facts of the case already decided by the Co-ordinate Bench of the Tribunal cited (supra), therefore, we hold that the order passed by the Assessing Officer without following the mandatory requirement of issue of notice u/s 143(2) makes the re-assessment order an invalid assessment. We, therefore, set aside the order of the Ld. CIT(A) / NFAC and the grounds raised by the assessee on this issue are allowed. 23. In the result, the appeal filed by the assessee is allowed.”

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appropriate to set-aside the order passed by Ld. CIT(A)/NFAC and declare the impugned assessment order dated 28.09.2021 as bad in law. Thus, the additional ground raised by the assessee on this issue is allowed.

Sd/- Sd/- (MANISH BORAD) (VINAY BHAMORE) ACCOUNTANT MEMBER JUDICIAL MEMBER Panaji / Dated : 14th August, 2026. Sujeet/DOC Digitally signed by Sujeet Kumar Sujeet Kumar Sharma Sharma Date: 2026.08.17 11:13:15 +05'30'

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आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The Pr. CIT concerned. 4. DR, ITAT, Panaji. गाड� फ़ाइल / Guard File. 5. आदेशानुसार / BY ORDER, // True Copy // Assistant Registrar/Sr.PS ITAT, Panaji.