Supreme Court Dismisses SLP: Assessment Order Quashed for Failure to Issue Timely Notice Under Section 143(2)
Case Overview
Case Name: ACIT Vs S.K. Industries (Supreme Court of India)
Appeal: Special Leave Petition (Civil) Diary No(S). 14128/2018
Date of Order: 19/07/2022
Forum: Supreme Court of India
Background of the Dispute
The present matter originates from an assessment order dated 31st March, 2016, framed by the Income Tax Department under Sections 144/143(3) of the Income Tax Act, 1961, against S.K. Industries. The assessee, through its partner, challenged this order before the Delhi High Court, raising a fundamental objection — that the Assessing Officer (AO) having actual jurisdiction over the assessee had failed to issue notice under Section 143(2) within the statutorily prescribed timeframe.
Factual Matrix
Jurisdictional Transfer and Return Filing
The sequence of events central to this case is as follows:
- On 28th March, 2010, the Commissioner of Income Tax (Central), New Delhi, exercised powers under
Section 127of the Income Tax Act, 1961 to transfer the petitioner's jurisdictional AO from Circle VIII to Circle 8(1), New Delhi. - The assessee filed its return of income on 29th September, 2013, before the AO of Circle 8(1), declaring a loss for the relevant assessment year.
The Notice Irregularity
- On 3rd September, 2014, ACIT, Circle 31(1) — referred to as Respondent No. 2 in the proceedings — issued notice under
Section 143(2). Crucially, this AO had no jurisdiction over the assessee at the relevant time. - Subsequently, the jurisdictional AO — Respondent No. 1 — issued a notice under
Section 142(1)on 21st July, 2015, calling for details pertaining to Assessment Year 2013-14.