Section 144 of the Income Tax Act
Income-tax Act, 2025: s.271
Section 144 of the Income-tax Act, 1961 corresponds to section 271 (Best judgment assessment) of the Income-tax Act, 2025.
Read section 271 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 144 is Collector, Land Acquisition v. Mst. Katiji (167 ITR 471), cited in 3,926 of the 24,748 judgments on BharatTax that turn on this section.
Leading authorities on Section 144
Delay in filing appeals, when supported by sufficient or justifiable cause, should be condoned with a liberal approach to ensure substantial justice. This principle prioritizes the cause of justice over mere technicalities.
When two equally plausible interpretations of a taxing provision are possible, or when conflicting views exist from non-jurisdictional High Courts, the interpretation that favors the assessee must be adopted.
An appeal before the Income Tax Appellate Tribunal can be dismissed for non-prosecution or treated as unadmitted when the appellant fails to appear, cooperate, or show diligence, in accordance with Rule 19(2) of the Income-tax (Appellate Tribunal) Rules. The law aids the vigilant, not those who sleep on their rights.
A court or tribunal is not bound to answer a reference or adjudicate an appeal on its merits if the party at whose instance the proceeding is made fails to appear at the hearing or take necessary steps for its proper conduct.
Appealing a tax assessment requires more than just filing the appeal; it involves actively pursuing it. The assessee must effectively engage with the appellate process.
The legal fiction created by the Ashish Agarwal judgment stops the limitation clock for Section 148 notices from the date of the deemed notice. Orders issued without proper jurisdiction, or those inconsistent with statutory prescriptions, are a nullity, and there can be no waiver of such fundamental jurisdictional requirements.
The Commissioner of Income-tax (Appeals) cannot dismiss an appeal for non-prosecution or default in appearance. Under Section 250(6) of the Income-tax Act, the CIT(A) must decide the appeal on its merits, even in an ex parte proceeding.
When the cost of acquisition of a capital asset cannot be determined, the computation mechanism for capital gains fails, and thus no capital gains can be charged. This establishes a broader principle that a charging section cannot operate in the absence of specific machinery provisions for computation.
When an issue is remitted to the Assessing Officer for fresh adjudication, the AO must conduct a de novo examination and provide the assessee a full opportunity of being heard. The assessee is bound to comply with the notices issued by the AO.
The issuance of a notice under Section 143(2) within the statutory time limit is mandatory for completing an assessment under Section 143(3), and the failure to do so renders the assessment invalid. This defect is not curable under Section 292BB of the Income Tax Act, 1961.
