Section 292B of the Income Tax Act
Income-tax Act, 2025: s.522
Section 292B of the Income-tax Act, 1961 corresponds to section 522 (Return of income, etc., not to be invalid on certain grounds) of the Income-tax Act, 2025.
Read section 522 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 292B is Commissioner of Customs v. Indian Oil Corporation Ltd. (267 ITR 272), cited in 501 of the 782 judgments on BharatTax that turn on this section.
Leading authorities on Section 292B
CBDT and CBEC circulars, along with administrative instructions, are binding on departmental authorities, who must not act in contravention of them. However, these circulars and instructions are not binding on courts or assessees.
A notice issued under section 148 to a non-existent entity, such as an amalgamating company post-merger, is a substantive illegality, rendering assessment proceedings void ab initio. Participation in such proceedings does not estop the assessee from challenging the validity of the notice.
An assessment framed in the name of a company that has ceased to exist due to amalgamation is invalid, even if the amalgamated company participated in the proceedings. Such a defect cannot be cured under section 292B of the Income-tax Act.
There is no legal requirement for a legal representative to report an assessee's death to the income tax department; consequently, a reassessment notice issued under Section 148 to a deceased person is invalid as it lacks proper jurisdiction.
An assessment framed by the Assessing Officer in the name of a defunct transferor company is valid if the assessee failed to intimate the AO about the merger or amalgamation.
For claiming weighted deduction under section 35(2AB), the existence of recognition for a Research and Development (R&D) Centre is relevant, not necessarily the date of approval or recognition.
Upon amalgamation, the amalgamating company ceases to exist in the eyes of the law. Therefore, any assessment or proceeding initiated against a non-existent amalgamating company is invalid as it is no longer considered a 'person' under the Income-tax Act.
Section 292B of the Income Tax Act applies only to procedural irregularities and cannot cure fundamental jurisdictional defects, such as the non-issue of a mandatory Section 148 notice for reassessment or framing an assessment against a non-existing or dead person.
CBDT administrative instructions and circulars are binding on income tax authorities and departmental officers, who must follow them during the assessment process and cannot act in contravention, even though these instructions are not binding on courts or assessees.
