Law:

Section:

Section 148, read with section 147, of the Income-tax Act, 1961 - Income escaping assessment - Issue of notice for - Assessment year 1986-87 - Whether where notice under section 148 was issued to an AOP of three persons while assessment was framed in AOP of two persons, of assessment order passed under section 147 was invalid - Held, yes FACTS The Assessing Officer issued notice under section 148 to an AOP of three persons calling upon it to furnish the return of income of AOP. However, the assessment was framed on AOP of two persons and though the name of the third member was duly mentioned in the assessment order as member of the AOP, it was scored off. On appeal, the Commissioner (Appeals) held that the assessment made was without assumption of jurisdiction by the Assessing Officer, inasmuch as notice under section 148 was issued to an AOP of three persons while the assessment was framed on AOP of two persons and cancelled the assessment. On revenue's appeal, the Tribunal upheld the order of the Commissioner (Appeals). On reference : HELD On the facts and circumstances of the case, there was no error in the order of the Tribunal. It is a settled principle of law that the notice under section 148 is a jurisdictional notice. It is not a notice for regular assessment and on the issue of the notice under section 148, the assessing authority assumes jurisdiction to proceed and pass assessment order. Therefore, the issue and service of a valid notice under section 148 to the assessee against whom action is being proposed to be taken and finally the assessment order is being passed, is essential. It is settled that none of the party can provide any jurisdiction to the authority and even the waiver on the part of the assessing authority to issue or the service of the notice would not confer jurisdiction to proceed. The notice under section 148 is not a mere procedural requirement. It is a condition precedent to the valid assessment order. [Para 6] It has also been held that in the notice the correct status should be mentioned and if the person has a dual capacity, the correct status of a person against whom reassessment order is proposed to be made is to be…

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