SARYU DEVI,RANCHI vs. ITO, WARD-1(1), RANCHI

Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before the Tribunal. At the time of hearing the Ld. AR of the assessee raised both legal and factual grounds, invalid Assumption of Jurisdiction as no notice under Section 148 of the act was served upon the assessee and without serving notice assumption of jurisdiction is bad in law as assessee was not registered on the income-tax portal at the relevant time; hence, service through electronic mode was impossible and no notice was served by email, by speed post, or by personal delivery. Therefore, the reassessment proceedings are void ab initio for want of valid service of notice.

On merits, it was submitted that the property in question was ancestral land. The land was transferred by her husband, Shri Hira Saryu Devi Nath Singh, in her name through a registered deed dated 31.01.2020.The transaction was not a sale, but a transfer without consideration between husband and wife and no money was paid or received, either in cash or through bank between the parties. The deed was executed only to safeguard the property from other family members, and to protect the interest of the assessee. The Ld AR stated that at the relevant time, as per Jharkhand Government policy, stamp duty for women was ₹1 only where property value was below ₹50 lakh and the transaction was in substance a gift, but shown as a sale deed only to save stamp duty. The Ld. AR filed an affidavit from the husband, who is also the transferor, was furnished, categorically stating that no consideration was received, no cash or bank transaction took place, the transfer was out of love and affection between the parties. It was therefore contended that there was no investment, and section 69A of the Act has no application.

On the other hand the learned DR supported the orders of the lower authorities. It was submitted that the assessee failed to comply with notices and the registration deed showed consideration of ₹30,70,000. Hence, the AO was justified in making the addition.

We after hearing the rival submission of the parties and perusal of material available on record, we find that it is an undisputed fact that the assessee was not registered on the income-tax portal during the relevant period. Her registration was done only on 09.03.2025. In such circumstances, service of notice through electronic mode was not possible. The assessee has categorically stated that no notice under section 148 of the Act was ever received, either electronically or physically. Proper service of notice under section 148 of the Act is a jurisdictional requirement. In absence of valid service, the reassessment Saryu Devi proceedings cannot be sustained. Therefore, we hold that the reassessment proceedings are invalid in law.

Even otherwise, on merits, we find that the alleged transaction is between husband and wife and the revenue has not brought any evidence to show that payment of consideration, flow of funds, cash withdrawal or deposit in such situation alleged addition cannot be made. Moreover, the affidavit of the husband clearly establishes that the transfer was without consideration, It was executed only for family and protective purposes. In present case of the assessee merely because a figure is mentioned in the registered deed, section 69A of the Act cannot be invoked unless actual money is found to have been paid or received. In the present case there is no unexplained money, there is no investment made by the assessee. In view of the above facts and legal position the reassessment proceedings under sections 147/148 of Act are held to be bad in law due to non-service of notice and even on merits, the addition under section 69A of the Act is unsustainable, as there was no monetary transaction between the parties. Accordingly, the addition of ₹30,70,000 made by the AO and sustained by the ld. CIT(A) is deleted.

In the result, the appeal filed by the assessee is allowed. Kolkata, the 22nd December, 2025.