ITAT Bangalore on Section 148 Notices: Uploading on Portal Alone Not Enough to Confer Jurisdiction

The Bengaluru Bench of the Income Tax Appellate Tribunal (ITAT) in Yella Vinod Kumar Vs DCIT (ITAT Bangalore) has held that a reassessment under Section 147 cannot be sustained where the Revenue fails to demonstrate that the Section 148 notice was actually issued and communicated to the assessee, even if the notice was generated and uploaded on the e-filing portal within the limitation period. The Tribunal ultimately annulled a reassessment involving an addition of ₹1,14,49,815 for AY 2015-16 on this jurisdictional ground alone.

The ruling underscores an important distinction in the context of electronically issued notices: a notice that exists in the system or is merely placed in an e-filing account is not automatically a notice “issued” in law. There must be a provable act of despatch or real-time communication to the assessee.

Background of the Case: Cash Deposits and Reopening

Non-filing of Return and Cash Deposits

For Assessment Year 2015-16, the assessee had not filed any return of income. Based on information available with the Department, it was noticed that cash aggregating to ₹1,14,49,815 had been deposited into a savings account maintained with ICICI Bank at Bellary.

Relying on this information, the Assessing Officer (AO) recorded reasons and sought approval from the competent authority for reopening the assessment under Section 147 of the Income Tax Act 1961. A notice under Section 148 was then generated on 31.03.2021, which was the last day of the relevant limitation period.

Ex Parte Assessment and Addition

According to the assessment order passed under Section 147 read with Section 144 and Section 144B, the AO proceeded on the basis that:

  • The Section 148 notice dated 31.03.2021 had been issued; and
  • The assessee did not respond to the said notice or to subsequent communications.

Due to the assessee’s continued non-compliance, the AO framed a best judgment assessment under Section 144, treating the entire cash deposits of ₹1,14,49,815 as unexplained and adding the same to the assessee’s income.

Appeal Before CIT(A) and Non-compliance

The assessee carried the matter in appeal to the Commissioner of Income Tax (Appeals), NFAC, Delhi. However, even at this stage, there was no appearance or material placed by the assessee. In the absence of any supporting evidence, the CIT(A) affirmed the assessment order and confirmed the addition.

The impugned order of the CIT(A) was dated 10.10.2025 (DIN: ITBA/NFAC/S/250/2025-26/1081628838(1)), and the reassessment order of the AO was dated 21.03.2022`.

Proceedings Before the ITAT: Delay and Additional Ground

Condonation of Delay

When the matter reached the Tribunal in ITA 951/BANG/2026, there was a delay of 62 days in filing the appeal. The assessee filed:

  • A petition seeking condonation of delay; and
  • An accompanying affidavit explaining the reasons for late filing.

After examining the explanation, the ITAT accepted that there was sufficient cause for the delay. The delay of 62 days was condoned, and the appeal was taken up for adjudication on merits.

Before the ITAT, the assessee raised several grounds, and also sought admission of an additional legal ground in the following terms:

“The reassessment proceedings are bad in law as the notice u/s. 148 dated 31.03.2021 was not at all served/ sent by the department to any valid email Id and hence, the learned assessing officer has not assumed proper jurisdiction and the entire reopening is bad in law on the facts and circumstances of the case.”

The assessee’s Authorised Representative (AR) argued that this legal ground struck at the very foundation of the reassessment proceedings and therefore deserved to be taken up as a preliminary issue, prior to examining the merits of the cash deposit addition.

The Tribunal agreed and admitted the additional ground, noting that it went to the root of jurisdiction under Section 147.

Assessee’s Contentions on Service and Issuance of Notice

Argument on Non-service of Section 148 Notice

The core contention of the assessee before the Tribunal was that the Section 148 notice dated 31.03.2021 had never been properly issued or served. Specifically, it was argued that:

  • The notice was only reflected as having been “uploaded” in the assessee’s e-filing account via the ITBA/e-filing portal.
  • There was no evidence that it had been despatched to any valid email address belonging to the assessee.