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Facts
The assessee challenged an addition of Rs. 13,67,786/- made under Section 69 for unexplained investment in a car. The assessee argued that the notice under Section 148 for reopening proceedings was never served, and the satisfaction note under Section 151 was not provided.
Held
The Tribunal held that the Department failed to provide any evidence of service of notice under Section 148, which is a mandatory condition for reopening proceedings. The lack of proof of service vitiated the entire reassessment proceeding.
Key Issues
Whether the reassessment proceedings are valid when there is no proof of service of notice under Section 148 on the assessee?
Sections Cited
144, 148, 147, 151, 69, 148(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “SMC” NEW DELHI
Before: Ms. MADHUMITA ROY
O R D E R
PER Ms. MADHUMITA ROY, JM:
The instant appeal, preferred by the assessee, is directed against the order dated 07.07.2025 [ITBA/APL/S/250/2025-26/1078251494(1)], passed by the Commissioner of Income Tax (Appeals)/JCIT(A)-1, Pune, arising out of the order dated 23.11.2016 passed by the ITO, Ward 2(2)(4), Ghaziabad in proceedings under Section 144 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), for assessment year 2013-14.
The assessee has challenged the addition of Rs. 13,67,786/- made under Section 69 of the Act on account of unexplained investment. The assessee, a subject matter before the Tribunal.
The assessee has raised a legal ground to this effect that notice under Section 148 of the Act was never served upon the assessee which is mandatory in reopening proceedings under Section 147 of the Act. Further that the compulsory requirement of satisfaction note recorded by the Learned AO was not provided to the assessee, neither the satisfaction under Section 151 of the Act was forwarded to the assessee. There is no independent application of mind neither any independent inquiry was made before the 148 notice claimed to have been issued. Under these facts and circumstances of the matter the Learned DR submitted that the notice was sought to be served upon the assessee at H. No. 948, Mohan Meakin Society, Sector-5, Vasundhara, Ghaziabad but the acknowledgement thereof has not been submitted before the Bench. In fact the Learned DR has failed to furnish any evidence which could prove the service of notice under Section 148 upon the assessee which the first and foremost condition to be fulfilled under the provisions of Section 148(1) of the Act in the absence of which the entire proceeding is vitiated.
Having heard the Learned Counsel appearing for the assessee and having regard to the facts and circumstances of the matter when it is evident that the Section 148 of the Act sought to be served upon the assessee has been received by the assessee, meaning thereby the service of notice under Section 144 of the Act though claimed to have been made, the same is found to be incomplete in the absence of proof thereof, which renders the entire proceeding vitiated. As the very foundation of reassessment proceeding is found to be invalid the entire proceeding is quashed. The appeal preferred by the assessee is allowed.
In the result, assessee’s appeal is allowed.
Order pronounced in open court on 14.01.2026.