KONDA DEVASENAMMA,BANGALORE vs. INCOME TAX OFFICER, WARD 5(1)(1), BANGALORE, BANGALORE

We have considered the submission. The additional ground raised goes to the root of the matter. It questions the very validity of the assessment proceedings on the basis of an unsigned statutory notice. The issue is a pure question of law. It does not require fresh investigation of facts because the material notice is already on record.

1 The Hon’ble Supreme Court in National Thermal Power Co. Ltd. v. CIT [229 ITR 383] has held that the Tribunal has juri iction to examine a question of law which arises from the facts as found by the authorities below, and having a bearing on the tax liability of the assessee, even though such question was not raised earlier before the lower authorities. Following the ratio laid down by the Hon’ble Supreme Court, we admit the additional ground raised by the assessee. This additional ground is accordingly taken up for adjudication along with the other grounds in the appeal.

2 The Authorised Representative for the assessee submitted that the notice issued under section 143(2) of the Act dated 19.07.2017 is not valid. The notice is neither signed manually nor digitally. Therefore,

3 The assessee relied on several judicial precedents. The Hon’ble Karnataka High Court in Begur Sinnappa Venkatesh v. ITO in WP 20807 of 2023 dated 9-11-2023 held that when the notice is not digitally or manually signed it is invalid. The Hon’ble Allahabad High Court in Vikas Gupta v. UOI 142 448 ITR 1 held that the words “shall be signed” in section 282A are mandatory. The Hon’ble Bombay High Court in Prakash Krishnatvar Bhardwaj v. ITO reported in 451 ITR 27 held that unsigned notices are invalid. The ITAT Mumbai in Reuters Asia Pacific Ltd. v. DCIT reported in 157 taxmann.com 705 also quashed an assessment where the notice was unsigned. The assessee further relied on the decision of the Bangalore Tribunal in Yashoda Electricals v. ACIT in ITA No.1175/Bang/2016 where it was held that section 292B cannot cure a defect if the juri ictional notice itself is invalid.

On the other hand, the Departmental Representative supported the orders of the Assessing Officer and the ld. CIT(A). It was submitted

We have considered the rival contentions of both the parties and perused the materials available on record. The provision of section 282A(1) of the Act requires every notice to be signed by the Income Tax Authority. Notification No. 2/2016 governing paperless assessment proceedings requires that statutory notices including those under section 143(2) of the Act must be attached in PDF format bearing the signature of the Assessing Officer. CBDT Instruction No. 1/2018 also requires that all e-proceeding notices must be digitally signed.

1 In the present case, the notice dated 19.07.2017 is neither digitally signed nor manually signed. It does not satisfy the requirement of section 282A(1) of the Act. It also does not comply with Notification No. 2/2016 or CBDT Instruction No. 1/2018. The authorities cited by the assessee directly apply to the facts. The notice issued is therefore invalid.

2 We are unable to accept the argument of the Department based on section 292B of the Act. The defect in this case is not procedural or technical. It goes to the root of juri iction. An unsigned notice is no ITA No.1239 & 2603/Bang/2024

3 Accordingly, the notice issued under section 143(2) dated 19.07.2017 is held to be invalid. The assessment made on the basis of such notice is void ab initio. The assessee’s appeal in ITA No.2603/Bang*/2024 is allowed. Since the assessment itself is quashed, all other grounds raised by the assessee are infructuous.

4 The revenue’s appeal in ITA No. 1239/Bang/2024 is directed against relief granted by the ld. CIT(A). However, once the assessment itself is held to be invalid, the revenue’s appeal does not survive. It is accordingly dismissed.

In the result, the assessee’s appeal ITA No. 2603/Bang/2024 is allowed whereas the revenue’s appeal ITA No. 1239/Bang/2024 is dismissed.

The Applicant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR, ITAT, Bangalore. 6. Guard file