JITESHKUMAR MADHAVBHAI JAGANI,SURAT vs. DY. CIT, CIRCLE-2(1)(1), SURAT

At the outset itself, the AR for the assessee challenged the jurisdiction assumed by the Assessing Officer by issuing notice u/s 148 of the Act. It was submitted that the alleged escapement of income was less than Rs.50 lakhs, and therefore the notice issued u/s 148 was invalid and void ab initio in view of the provisions of section 149 of the Act. The Ld. DR could not controvert the submissions made by the Ld.AR.

We have heard the rival contentions and perused the material available on record. We find that the notice u/s 148 of the Act was issued beyond three years Jiteshkumar Madhavbhai Jagani Vs. DCIT Asst. Year : 2016-17 - 2– from the end of the relevant assessment year and, therefore, as per section 149(1)(b) of the Act, reopening could be done only if the Assessing Officer possessed material evidence showing escapement of income represented in the form of asset amounting to Rs.50 lakhs or more. Since the escapement in the present case admittedly did not exceed Rs.50 lakhs, the assumption of jurisdiction itself was bad in law.

In view of the above undisputed facts, the jurisdictional condition prescribed under section 149(1)(b) of the Act is not satisfied. Consequently, the notice issued under section 148 and all proceedings emanating therefrom are without authority of law and liable to be quashed.