SUCCESS VYAPAAR PVT. LTD.,,KOLKATA vs. ITO, WARD 8(4),, KOLKATA

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ITA 2359/KOL/2025Status: DisposedITAT Kolkata22 July 2026AY 2012-20137 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the non-issuance of notice under Section 143(2) is a jurisdictional defect, not a curable one, rendering the assessment invalid. Therefore, the reassessment proceedings were quashed.

What were the facts?

The assessee's case was reopened under Section 147, and a notice under Section 148 was issued. However, the Assessing Officer (AO) framed the assessment without issuing mandatory notices under Section 143(2) and Section 142(1) of the Income Tax Act.

What were the issues?

Whether the assessment framed without issuing mandatory notices under Section 143(2) and Section 142(1) after reopening the case under Section 147 is valid in law.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 143(2),Section 142(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH, KOLKATA

For Appellant: Shri Anil Kochar, AR
For Respondent: Shri Praveen Das Chowdhury
Hearing: 14.07.2026Pronounced: 22.07.2026

Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 21.08.2025 for the AY 2012-13.

2.

At the time of hearing the ld. counsel for the assessee raised additional ground which is extracted below: -

“1. For that the ld. AO erred in passing order u/s 143(3) read with section 147 of the Act in as much as no notice u/s 143(2) and 142(1) of the Act were issued during the course of assessment rendering the reassessment bad in law required to be quashed.”

ITA No. 2359/KOL/2025 Success Vyapaar Pvt. Ltd.; A.Y. 2012-13 2.1. After hearing the rival contentions and perusing the material on record, we find that the assessee has raised the above additional ground of appeal challenging the jurisdiction of the AO to make addition. In our opinion the issued raised in the additional ground is a purely a legal issue qua which all the facts are available in the appeal folder and no further verification of facts are required from any quarter whatsoever. In our considered view the assessee is at liberty to raise any legal issue before any appellate authority for the first time even when the same has not been raised before the lower authorities. The case of the assessee is squarely coverd by the decisions of the Apex court in the case of i) Jute Corporation of India Ltd. Vs CIT in 187 ITR 688 , ii) National Thermal Power Co. Ltd v. CIT [1998] 229 ITR 383 and also by the decision of Hon’ble Calcutta High Court in PCIT vs. Britannia Industries Ltd. [2017] 396 ITR 677 (Cal). Therefore, we are inclined to admit the same for adjudication. 3. The ld. AR vehemently submitted before us that the ld. AO has framed an assessment in the instant case without issuing notice under section 143(2) and 143(1) of the Act. The ld. AR submitted that the notice under section 148 of the Act was issued on 29.03.2019 and the assessee complied with the said notice by filing a return of income on 02.12.2019 in compliance to notice issued under section 148 of the Act, which has been stated by the ld. AO in paragraph 11 of the assessment order. Thereafter, the ld. AO straightaway framed the assessment without issuing notice under section 143(2) and 143(1) of the Act. The ld. AR in defence of his argument produced before the Bench (view notice for e-proceedings)

ITA No. 2359/KOL/2025 Success Vyapaar Pvt. Ltd.; A.Y. 2012-13 and submitted that nowhere fact of notices under section 143(2) and 143(1) of the Act, after issuing notice under section 148 was mentioned. The ld. AR therefore prayed that the assessment framed by the ld. AO sans notice under section 143(2) is bad in law and may kindly be quashed.

4.

The ld. DR on the other hand relied on the orders of the authorities below by submitting that facts need to be verified from the AO whether notice under section 143(2) and 143(2) of the Act, were issued or not and requested the bench to allow time of at least 15 days to ascertain the said fact.

5.

We find that the assessee in this case filed the return of income on 20thSeptember, 2012 declaring total income at ₹nil. The case of the assessee was reopened under section 147 of the Act, after obtaining sanction from ld. PCIT, Kolkata zone. Accordingly the notice under section 148 was issued on 29th 2019. The case of the assessee was reopened on the ground that assessee is a beneficiary of ₹50 lakh received from M/s Rakesh Iron and Steel, which is nothing but assessee’s own money borrowed back into the books of account in the guise of accommodation entries. We note that apparently on the basis of ‘view notice for e-postings’ that nowhere the statutory notice under section 143(2) and show cause notice under section 142(1) of the Act, were mentioned to be issued. For the sake of ready reference the ‘view notice of e-proceedings’ is reproduced below: -

ITA No. 2359/KOL/2025 Success Vyapaar Pvt. Ltd.; A.Y. 2012-13

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ITA No. 2359/KOL/2025 Success Vyapaar Pvt. Ltd.; A.Y. 2012-13

6.

The ld. AO gas not mentioned the said fact in the assessment order. In our opinion the assessment framed by the ld. AO sans notice under section 143(2) is not sustainable in the eyes of the law. The non issuance of notice is not a procedural and curable defect as it goes to the root of the matter. Therefore, the assessment framed is invalid and nullity in the eyes of law. The case of the assessee is squarely covered by the decision of the co-ordinate Bench in case of Chandrani Commotrade Pvt. Ltd. Vs. ITO in ITA No. 665/KOL/2025 vide order dated 05.03.2026, wherein the co-ordinate Bench has held as under:-

ITA No. 2359/KOL/2025 Success Vyapaar Pvt. Ltd.; A.Y. 2012-13 “7. After hearing the rival submissions and perusing the material available on record, we find that no notice u/s 143(2) of the Act was issued after the assessee complied with the notice issued u/s 148 of the Act vide letter dated 27.03.2019, wherein it was stated that the return filed originally u/s 139(1) of the Act on 17.09.2012 may be treated as return filed in response to notice u/s 148 of the Act. We note that despite that the AO has not issued any notice u/s 143(2) of the Act as is apparent from the assessment order and e- proceedings statement for notice also confirmed that after compliance to section 148 of the Act ,no notice u/s 143(2) of the Act was issued. In our opinion the issuance of notice u/s 143(2) of the Act is mandatory requirement for assuming jurisdiction to frame the assessment failing which the assessment itself is rendered invalid and nullity in the eyes of law. The case of the assessee is squarely covered by the following decision in the case of Dynamo Realcom Pvt Ltd. Vs ITO Ward1(1), ITA No. 1999/Kol/2024 A.Y. 2013-14 order dated 14.01.2026. Therefore, Ground No. 5 is also allowed. 8. Since, we have allowed the appeal of the assessee on legal issues and the other grounds raised on merit are not being decided at this stage and are being left open to be decided if the need arises for the same in future. 9. In the result, the appeal of the assessee is allowed.” 7. Consequently, the reopening of assessment as well as the assessment framed are hereby quashed. Before parting it is noteworthy mention that the ld. DR was allowed 15 days time to ascertain the fact from the AO, whether the notices u/s 143(2) or 142(1) of the Act were issued. This order is only being passed after a expiry of 15 days from the date of hearing as the ld. CIT DR did not file any reply within 15 days. The additional ground of the Assessee is allowed.

8.

In the result, the appeal of the assessee is allowed.

Order pronounced on 22.07.2026.

Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 22.07.2026 Sudip Sarkar, Sr.PS

ITA No. 2359/KOL/2025 Success Vyapaar Pvt. Ltd.; A.Y. 2012-13 Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT DR, ITAT, 4. 5. Guard file. BY ORDER, True Copy//

Asst. Registrar Income Tax Appellate Tribunal, Kolkata

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