Section 153(2) of the Income Tax Act
Income-tax Act, 2025: s.286
Section 153(2) falls under section 153 of the Income-tax Act, 1961, which corresponds to section 286 (Time limit for completion of assessment, reassessment and recomputation) of the Income-tax Act, 2025.
Read section 286 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 153(2) is 165 Taxman 95 (Del); (ii) CIT v. Atedhsy Films P. Ltd. (306 ITR 309), cited in 35 of the 176 judgments on BharatTax that turn on this section.
Leading authorities on Section 153(2)
A notice is presumed to have been properly served if it is not returned as unserved, and objections regarding non-service are not acceptable in such cases.
A draft assessment order under section 144C(1) must be issued before a final assessment order, and a corrigendum cannot cure the failure to issue a proper draft order.
Service of a notice or requisition under the Income-tax Act must be made in accordance with Section 282(1), which allows for service by post or as if it were a summons under the Code of Civil Procedure, 1908. Rules 12 to 15 of Order V of the CPC are relevant, emphasizing personal service where practicable.
Interest paid on debentures until their conversion into shares is considered interest on borrowed money and is subject to TDS provisions. Such interest cannot be treated as dividend.
The Revenue bears the burden of proving that a notice was duly served on the assessee or their authorized representative. If no valid notice is served within the prescribed period, the Income-Tax Officer lacks the authority to initiate reassessment proceedings.
