1 AFR Court No. - 35 Case :- INCOME TAX APPEAL No. - 87 of 2009 Appellant :- Km. Teena Gupta Respondent :- Commissioner Income Tax Bareilly Counsel for Appellant :- Rakesh Ranjan Agarwal,Suyash Agarwal Counsel for Respondent :- S.S.C. I.T.,Praveen Kumar,S.Chopra Hon'ble Bharati Sapru,J. Hon'ble Saumitra Dayal Singh,J. present income tax appeal under Section 260 of Income Tax Act, 1961 (hereinafter referred to as 'Act') has been filed by assessee against order dated 2.3.2009 of Income Tax Appellate Tribunal, Delhi Bench, New Delhi for assessment year 1997-98. above appeal was admitted on following questions of law:- (A) Whether on facts and circumstances of case, ITAT was correct to hold that not mentioning of assessment year in notice u/s 148 dated 11.5.2000 would not make reassessment proceedings illegal since 142(1) notice dated 13.6.2000 mentioned assessment year and assessee was aware of fact that proceedings u/s 148 has been initiated for A.Y. 1997-98? (B) Whether ITAT has rightly ignored that service of valid notice u/s 148 is condition precedent to assume jurisdiction of reassessment and mere knowledge or? (C) Whether non supply of reasons alongwith notice u/s 148 of Act can validate reassessment proceedings. Mithlesh Kumar Tripathi Vs. CIT 2006 UPTC 155? (D) Whether reassessment order passed u/s 144/148 of Act, was not invalid and rightly affirmed by ITAT, when notice u/s 143(2) of Act was not served on appellant, as provided under Clause (b) of proviso to section 148(1) of Act, as inserted by Finance Act, 2006, effective from 01.10.1991? 2 (E) Whether ITAT rightly affirmed invoking of section 69A of Act holding that appellant had capital of Rs. 1,50,000/- to Rs. 1,75,000/- without bringing any material on record? Briefly it has been contended by assessee that notice initiating re-assessment proceedings to assessment year 1997-98 had been issued against him dated 11.5.2000 without any reference to assessment year. Subsequently, on 13.6.2000 notice under Section 142(1) of Act was issued in respect of assessment proceedings for assessment year 1997-98. Thereafter, on 4.7.2000 exparte assessment order was passed under Section 144/148 of Act in case of assessee for assessment year 1997-98. It has been further shown to us that in appeal against reassessment order dated 4.7.2000, assessee had raised specific ground setting up invalidity in reassessment proceedings on account of non-disclosure of assessment year in reassessment notice dated 13.6.2000. CIT (Appeals) dismissed appeal on 28.2.2001 without adjudicating aforesaid ground. In further appeal to Tribunal again assessee raised specific ground setting up invalidity of reassessment proceedings for reasons of non disclosure of assessment year in reassessment notice. We have heard Sri Suyash Agarwal, learned counsel for assessee and Sri Praveen Kumar, learned counsel for department. At very outset, Sri Suyash Agarwal, learned counsel for assessee has confined his argument on question no.1. 3 Tribunal by its impugned order, dealt with aforesaid objection raised by assessee and negatived his claim. According to Tribunal assessee having not raised this ground at stage of reassessment proceedings itself, it had conceded same and assessee did not have any grievance at that time. Thereafter Tribunal has also relied on notice issued under Section 142(1) of Act dated 13.6.2000 to come to conclusion that reassessment proceedings were valid. It is settled law that reassessment notice is jurisdictional notice and it is equally settled law that ground of lack of jurisdiction may be raised at subsequent stage as well. In instant case reassessment order was admittedly exparte order and, therefore, there was no occasion for assessee to have conceded to reassessment proceedings. Further, in instant case, it is clearly being shown by assessee that he had raised specific ground both before CIT (Appeals) and also before Tribunal, challenging jurisdiction of Assessing Officer. This Court in case of Smt Prabha Rani Agarwal Vs. Income Tax Officer and another reported in 2013 (351) ITR 275 (All) has held as under:- 16. In case of Laxmi Narain Anand Prakash 46 STC 71 (All) [FB]; [1980] UP Tax Cases 125 (All), Full Bench of this Court has held that further notice under Section 21 of U.P. Sales Tax Act, 1948, having been improperly served initiation of proceedings was without jurisdiction and it could not be 4 validated by participation of assessee in proceedings and invalidity of notice goes to very root of matter and whole proceedings has been vitiated in law. If it is found that notice instead of being addressed to dealer was addressed to entity which did not exist, defect in notice was fatal to assumption of jurisdiction by Sales Tax Officer. Further Court had also held as under:- 26. From aforesaid decisions, it follows that (i) question relating to jurisdiction which goes to root of matter can always be raised at any stage, be in appeal or revision, (ii) initiation of proceedings under section 147 of Act and/or service of notice are all questions relating to assumption of jurisdiction to assess escaped income, (iii) if issue has not been decided in appeal and matter has simply been remanded, same can be raised again notwithstanding with fact that no further appeal has been preferred, (iv) in reassessment proceedings, relief in respect of item which was not originally claimed can not be claimed again as reassessment proceedings are for benefit of Revenue and (v) relief can only be claimed in respect of escaped income. Applying principles laid down in aforesaid cases to facts of present case, we find that in first round of proceedings before Commissioner of Income Tax (Appeals), appellant had specifically questioned validity of proceedings initiated under section 148 of Act. That issue was not decided by Commissioner (Appeals) who had remanded matter for fresh assessment after providing opportunity of hearing. question relating to jurisdiction assumed under section 147/148 of Act goes to very root of matter and it can be raised in appeal for first time. appellant had raised this question again in appeal and, therefore, it was incumbent upon Commissioner of Income Tax (Appeals) to adjudicate upon grounds taken before him. In fact, he had casually observed that proceedings under section 148 of Act had been validly initiated but, wrongly applied principles laid down by Apex Court in case of Sun Engineering Works P. Ltd. [1992] 198 ITR 297 (SC). 27. Before Tribunal, appellant had challenged adverse findings recorded by Commissioner of Income Tax (Appeals) by raising 4 specific grounds which we have already reproduced hereinbefore. Tribunal had erred in law in declining to permit appellant to raise those grounds. 28. approach of Commissioner of Income Tax (Appeals) is erroneous in law for reason that in 5 grounds of appeal filed against order dated 21.03.1997, specific ground relating to validity of proceedings initiated under section 148 of Act had been taken which was not gone into by Commissioner of Income Tax (Appeals) while setting aside assessment. principles laid down by Apex Court in case of Sun Engineering Works P. Ltd. (supra) would not apply as appellant is not claiming any deduction or relief on taxibility of any item in reopened assessment proceedings which had not been claimed in original assessment. Tribunal had also erred in law in holding that as no appeal had been filed by appellant against order 05.02.1998 passed by Commissioner of Income Tax (Appeals), same had become final and appellant can not be permitted to raise any ground relating to validity of proceedings under section 148 of Act in remand proceedings. In view of above, we are of view that issue of validity of reassessment proceedings is jurisdictional issue. It goes to root of matter. Tribunal ought to have examined ground no.3 raised in assessee's appeal on its merit without being prejudiced by facts that reassessment order has been passed on exparte basis in which proceedings assessee has not objected to initiation of reassessment. Accordingly, question no.1 is answered in favour of assessee and against department. appeal is allowed. order of Tribunal is set aside and matter is remitted to Tribunal to decide afresh in accordance with law. Order Date :- 30.3.2017 Mini Teena Gupta v. Commissioner Income-tax, Bareilly