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Facts
The assessee filed its return of income for AY 2012-13, which was selected for scrutiny. The Assessing Officer issued a notice u/s 143(2) to an old address and an incorrect email ID, resulting in the notice being unserved and returned. The assessee raised objections regarding the non-service of the jurisdictional notice before the assessment was completed, but the CIT(A) dismissed these grounds, leading to cross-appeals before the Tribunal.
Held
The Tribunal held that proper service of notice u/s 143(2) is a jurisdictional condition, which was not met as the notice was sent to a wrong address and incorrect email and remained unserved. Consequently, the assessment completed without a valid jurisdictional notice was set aside. The assessee's appeal was allowed, and the Revenue's appeal was dismissed.
Key Issues
Whether an assessment framed under Section 143(3) is valid if the jurisdictional notice under Section 143(2) was not properly served on the assessee, and the applicability of Section 292BB when objections to non-service were raised.
Sections Cited
143(1), 143(2), 143(3), 142(1), 292BB
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Income Tax Appellate Tribunal, DELHI BENCH ‘F’: NEW DELHI
(Assessment Year : 2012-13) M/s. Suhir Finance and Chits Pvt. Ltd., vs. ITO, Ward 24 (3), WZ-13, Gali No.18, Krishna Nagar, New Delhi. Tilak Nagar, New Delhi – 110 018. (PAN : AAOCS7131F) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Vikash Jain, Advocate Ms. Sarawani, Advocate REVENUE BY : Shri Sahil Kumar Bansal, Sr. DR Date of Hearing : 08.07.2025 Date of Order : 19.09.2025 O R D E R PER S.RIFAUR RAHMAN, ACCOUNTANT MEMBER : 1. These cross appeals are filed by the Revenue and assessee against the order of ld. Commissioner of Income Tax (Appeals)-28, New Delhi [“ld. CIT(A)”, for short] dated 28.08.2019 for Assessment Year 2012-13.
& 8767/Del/2019 2. Since the issues are common and the appeals are connected, hence the same are heard together and being disposed off by this common order. We proceed to hear the appeal of the assessee being wherein assessee has raised the jurisdictional issue which is having bearing on both the appeals.
Brief facts of the case are, assessee filed its return of income on 03.09.2012 declaring an income of Rs.16,470/-. The return was processed under section 143(1) of the Income-tax Act, 1961 (for short ‘the Act’) and subsequently, the case was selected under CASS for detailed scrutiny. As per the assessment order, notice u/s 143(2) was issued on 23.09.2013 and also notices u/s 142(1) were issued and served on the assessee. In response, ld. AR of the assessee attended and submitted relevant information as called for.
4. The assessee is engaged in the business of trading of fabrics and textiles. Since we are dealing with jurisdictional issue, we restrict ourselves first to address the jurisdictional issue.
5. At the time of hearing, ld. AR of the assessee brought to our notice that the assessee has not been served the jurisdictional notice u/s 143(2) of the Act and this issue was raised before the Assessing Officer but the Assessing Officer has not disposed of the above objections. Further he submitted that assessee has raised submissions before the ld. CIT (A) and ld. CIT (A) has & 8767/Del/2019 not appreciated the submissions of the assessee and dismissed the grounds raised
by the assessee.
6. Against the above order, assessee is in appeal before us. Further he submitted that ld. CIT (A) has partly allowed the appeal of the assessee on merits against which Revenue is in appeal.
7. At the time of hearing, ld. AR submitted as under :- “1.1 That on 03.09.12 the Assessee filed ITR and declared B-340, 2nd Floor, Hari Nagar, New Delhi-64 as address to which correspondence was to be made and also declared his email id as sanjeev.jan07(ii!gmail.com for online correspondence. 1.2 The notice D/s 143(2) dated 23.09.2013 was sent to the old address of the assessee i.e. A-1/82 2nd Floor Hatsal Road Uttam Nagar, New Delhi -59 through speed post no.- ED906633955IN which was the address of the Assessee till 15th October, 2010 and mentioned the official email id for correspondence as rajeev_kh08@yahoo.co.in. 1.3 However, on 30.09.2013, it was returned unserved to the office of revenue department. On 30.09.2013, the Income Tax Department used the mail id mentioned in the impugned ITR i.e sanjcev.jan07@gmail.com but instead committed an error by sending the notice to sanjcev.jan07@mail.com. Thus Notice was never sent to the Assessee as mail.com is not a functional domain name. 1.4 On 18.10.2013, notice u/s 142(1) was issued to the assessee on the current address. However, it was not a 143(2) notice. It was in the form of a questionnaire. (Refer page no. 6 of Small Paperbook). 1.5 That vide reply dated 30.10.2013, the assessee had raised an objection before AO prior to the completion proceedings. 1.6 On 17.03.2015, the assessment order was passed without disposing off the objections raised by the assessee as per section 292BB of Income Tax Act, 1961. 1.7 On 25.03.2015, the assessee had filed the appeal before CIT(A) assailing the assessment order passed by AO on the ground that framing of assessment u/s 143(3) without service of notice u/s 143(2) to the assessee is bad in law. 1.8 That on 28.08.2019, the CIT(A) passed the impugned order and held that the assessee failed to prove that notice U/s 143(2) issued by the AO on 25.09.2013 was returned back as undelivered or unserved. (Page 12-14 Para 6.2 of the CIT(A) Order.)
1.9 That on 04.12.2024 the DR produced the Assessment Record which clearly prove that notice u/s 143(2) was returned unserved and remained undelivered as it was sent on old address of the Assessee. It was further proved that AO chose the email id mentioned in the ITR of the impugned year thus AO was aware/informed about the change in official address i.e B-340, 2nd Floor, Hari Nagar, New Delhi- 64 of the Assessee Company prior to 30.09.2013. Submission-1 Notice u/s 143(2) shall be served on the latest ITR address mentioned by the Appellant Company. 1.10 This stand of the Assessee Company is corroborated by the observations of the Hon'ble Delhi HC in CIT vs Mascomptel [2012] 345 ITR 58 1.11 It is humbly submitted that once the latest address of the Assessee is in the knowledge of the AO then the AO was duty bound to serve the Notice Vis 143(2) on the latest address. In the present case it is amply clear that the AO is aware of my latest address as he himself has taken the email address from the impugned ITR, thus he cannot deny the knowledge of the existence of the physical address of the Assessee. Submission-2 - Upon failure to properly serve a notice Vis 143(2) the Assessing Officer is duty bound to take second steps to rectify the issue of non-service. 2.1 It is humbly submitted that the AO is duty bound to take second steps once the Notice u/s 143(2) was returned back as undelivered. This assertion is backed by the observations of the Hon'ble Pune Tribunal in Anil Kisanlal Marda v. Income-tax Officer, Ward-3(1), Pune. 2.2 It is submitted that in the above-mentioned case law the court clearly held that once notice remains unserved, the notice has to be re-served to the Assessee Company before the expiration of the limitation period i.e 30.09.2013. Further the court held that Notice u/s 143(2) shall be served on the latest address mentioned in the return of income of the Assessee if the Revenue fails to duly serve the notice Vis 143(2) on the address mentioned in the PAN Database of the Company. In the present case the Assessing Officer was aware of the address mentioned in the ITR as he himself used the email address mentioned in the same address albeit unsuccessfully on 30.09.2013. The Hon'ble Supreme Court in PCIT vs I-Ven Interactive Limited (2019) 418 ITR 662(SC) is distinguishable from the facts of the Assessee's case as in I-Ven case the notice u/s 143(2) was accepted by the associate of the Assessee on the address available as per the PAN database. However, in the present case the Notice u/s 143(2) was neither served through speed post (returned unserved) nor served through email as the email id used by the AO was incorrect.”
On the other hand, ld. DR of the Revenue particularly brought to our notice para 5 of the first appellate order and he supported the findings of the ld. & 8767/Del/2019 CIT(A) who has dealt with the issue of notice elaborately. Further he submitted that assessee has not carried out any trading activities and wondered how the assessee has carried on the trading activities in this year and there is no evidence to show how assessee has maintained staff for so many years. With regard to notice issued, ld. DR brought to our notice letter dated 06.12.2024 from the Assessing Officer who had clarified the issue of notice issued u/s 143(2) of the Act and finally he heavily relied on the findings of the lower authorities.
Considered the rival submissions and material available on record. We observe that the Assessing Officer has issued notice u/s143(2) dated 23.09.2013 which was sent to the old address of the assessee through Speed Post, it was submitted that the assessee was in the above address till 15.10.2010 and the official email id for correspondence was given as rajeev_kh08@yahoo.co.in. However, the abovesaid notice was returned to the office of the Assessing Officer on 30.09.2013 and on the same day, the Assessing Officer sent the above notice through email id i.e. sanjeev.jan07@mail.com. On the other hand, assessee submitted that right email address which should have been used was sanjeev.jan07@gmail.com. Therefore, the notice was never served to the assessee. When the Bench raised the above issue to the ld. DR of the Revenue, ld. DR submitted
From the above letter, we notice that the Assessing Officer confirms the fact that the abovesaid notice was sent by post and a print copy was sent through email dated 30.09.2013 sent at the email id i.e. sanjeev.jan07@mail.com with the subject ‘Notice u/s 143(2) for A.Y. 2012-13’ is placed in physical file. However, he confirmed that delivery status of the email is not available with his office. From the above, it is very clear that the abovesaid notice was issued to the assessee in a wrong address and also email address used was also wrong and the notice u/s 143(2) was never served on the assessee. We observe that ld. CIT (A) has proceeded with the view that the Assessing Officer has issued the notice by speed post merely issuing the notice by speed post serves the purpose by relying on certain decisions. He also relied on the provisions of section 292BB of the Act. Further considering the overall facts on record, we observe that section 143(2) is a jurisdictional notice without which Assessing Officer has no jurisdiction to proceed with the assessment. We observe that Hon’ble Delhi High Court in the case of CIT vs. Mascomptel India Ltd. (2012) 25 taxmann.com 121 (Delhi) held as under :- “3. In the present case the assessing officer had issued a notice under Section 143(2) dated 11.10.2007 to the respondent/assessee. The said notice was addressed at 44-Rajendra Bhawan, Rajendra Place, New Delhi. The notice could not be served and was received back with the remark of the postal authority that “no such person exists at the address mentioned”. An Inspector was deputed to serve the notice personally but he also reported that the company was not available at the address. The Assessing Officer, thereafter served the notice by affixture. Date of notice of the affixture is however not stated in the assessment order. The assessment was made exparte/best judgment assessment order was passed.
The CIT (Appeals) and the Tribunal have held that the aforesaid service by the affixture was not valid. The findings of the CIT (Appeals) and the Tribunal are that the assessee had mentioned a different address in the return of income tax filed for the assessment year in question. In the return of income tax the address mentioned was 1-GF, AGCR Enclave, Karkardooma, Delhi. They have held that the assessee was earlier functioning from 44-Rajendra Bhawan, Rajendra Place, New Delhi and had shifted from the said address in 2001. It has also come on record that the TDS Officer (who was also the Assessing Officer) had issued notice dated 01.10.2007 at I-GF, AGCR Enclave, Karkardooma, Delhi. The said address was also mentioned in the balance sheet, profit and loss account, tax audit report as well as the assessment order under Section 143 (3) dated 30.02.2007 for the assessment year 2005-06 i.e. the immediately preceding assessment year.
Aforesaid facts speaks for themselves. No attempt was made to serve the respondent-assessee at the correct address which was available with the department and in fact stated in the return of the income for the assessment year 2006-07. Subsequent, attempt to serve another notice under Section 143(2) at 1- GF, AGCR Enclave, Karkardooma, Delhi in November, 2008, long after expiry of the limitation period prescribed by the proviso, cannot help the revenue.” 11. Further we observe that ITAT, Pune Bench in the case of Anil Kisanlal Marda vs. ITO, Ward 3(1) (2019) 108 taxmann.com 55 (Pune-Trib.) held as under :- “23.1. The ld. DR invoked the provisions of section 292BB to contend that since the assessment proceedings were attended by the assessee he cannot now claim that the notice was not issued or served on him. 23.2. We can better appreciate the contention on having a glimpse at section 292BB, which runs as under : “Notice deemed to be valid in certain circumstances.— Where an assessee has appeared in any proceeding or cooperated in any inquiry relating to an assessment or reassessment, it shall be deemed that any notice under any provision of this Act, which is required to be served upon him, has been duly served upon him in time in accordance with the provisions of this Act and such assessee shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was— (a) not served upon him; or (b) not served upon him in time; or (c) served upon him in an improper manner:
& 8767/Del/2019 Provided that nothing contained in this section shall apply where the assessee has raised such objection before the completion of such assessment or reassessment.". 23.3. This section was inserted by the Finance Act, 2008 w.e.f. 01-04-2008 and thus covers the assessment year/proceedings under consideration. It provides that where an assessee appears in any proceedings and co-operates in an inquiry relating to the assessment etc., it shall be deemed that any notice issued under any provisions of this Act, which is required to be served, has been duly served upon him as per law. When it is so, the assessee shall be prohibited from taking any objection in any proceedings that the notice was not properly served upon him. The proviso to this section states that if an assessee raises an objection before the completion of assessment that the notice was not properly served, then the provision deeming a proper service on attending the assessment proceedings etc., shall not apply. Further, what is relevant to note is that this section dispenses with the requirement of `service’ of notice in the given circumstances and not the `issue’ of notice. If a particular provision requires issue of notice within a stipulated period and no notice is actually issued, even though the requirement of service of notice will stand satisfied with the assessee attending the assessment proceedings, but the Revenue will still have to independently prove that the notice was issued. If issuance of a notice is not established, the adverse consequences will follow. 23.4. Since the proviso to section 143(2) talk of service of notice and not issue of notice, let us examine if the notice u/s 143(2) was served on the assessee in terms of section 292BB on his attending the assessment proceedings. 23.5. The assessee has placed on record a copy of his letter dated 28-11-2011 addressed to the DCIT, Circle-3, PMT Building, Pune objecting to the service of notice dated 08-092010 purportedly issued u/s. 143(2) and served upon him. The assessee categorically stated that “I would like to state that the said notice 08-09- 2010 has not been received by me”. It has also been mentioned in para 4 of the assessee’s aforesaid letter that “hence, this notice is not a valid notice and bad in law. I request you to please quash the assessment proceedings”. This letter of the assessee bears the stamp of the office of ACIT, Circle-3, Pune with the date of 28- 11-2011. On examination of the assessment folder produced before us by the ld. DR, it is found that the original of this letter bearing the date of receipt by the office of ACIT, Circle-3 as 28-11-2011, is available there. The assessment order in this case was passed on 30-12-2011. Thus, it is proved that the assessee did raise objection of the non-service of notice before the AO before the completion of assessment and such an objection has not been disposed of by the AO either in the assessment order or otherwise. It is evident from the assessment folder that notice u/s.143(2) dated 08-092010 was issued but never served upon the assessee and, in fact, returned by the postal authorities. It is further clear that no other notice u/s. 143(2) was issued by the AO before the cut-off date of 30-09-2010. Accordingly, proviso to section 292BB gets magnetized and the deemed service of notice u/s.143(2), by virtue of the main part of the section 292BB, is erased.
& 8767/Del/2019 24. Now turning to the facts of the instant case, it is found as an admitted position that no notice u/s. 143(2) was actually served upon the assessee on or before 30-09-2010. The only notice which was issued on 08-09-2010 was returned by the postal authorities and thereafter no effort was made to serve another notice before the deadline. Since the requirement of `service’ of notice u/s. 143(2) and not its `issue’, is a jurisdictional condition, which is unfortunately lacking in the instant case, the sequitur is that the AO lacked jurisdiction to make the assessment. Ex consequenti, the assessment order passed in absence of a valid jurisdiction has to be and is hereby quashed.”
Respectfully following the above decisions, we are inclined to allow the grounds raised
by the assessee that the notice u/s 143(2) was never served on the assessee, therefore, the assessment completed without jurisdictional notice is set aside. Accordingly, the appeal filed by the assessee is allowed.
13. Since we have allowed the appeal of the assessee on the issue of notice u/s 143(2) of the Act, the appeal preferred by the Revenue is dismissed.
14. To sum up : the appeal filed by the assessee is allowed and the appeal filed by the Revenue is dismissed. Order pronounced in the open court on this 19th day of September, 2025.