S. 148A Notice Must Be Issued Before S. 147 Order: Jharkhand HC Quashes Order, Finds Lapse by Income Tax Dept [Read Order]

The petitioner, Anvari Khatun had challenged the reassessment order dated 28.11.2024 passed by respondent no. 4 under Sections 147 read with 144 and 144B of the Act.

The Counsel for the petitioner argued that the impugned order was vitiated by non-compliance with the mandatory procedural safeguard under Section 148A, which requires issuance of a show cause notice and providing an opportunity of hearing before reopening an assessment under Section 147.

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According to section 148A, specifically requires the Assessing Officer to issue a notice if they decide to initiate re­assessment. According to the new provision, the income tax officer must investigate the information indicating that the income subject to tax has eluded assessment or give the taxpayer a chance to be heard. Before issuing such a notification, the income tax officer must first secure the approval of a designated authority.

During the hearing, counsel for the Income Tax Department, on instructions, candidly admitted that no such notice under Section 148A had been issued to the petitioner before passing the reassessment order. Acknowledging this procedural default, the High Court held that the order could not be sustained in law.

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Accordingly, the Division Bench comprising Chief Justice M. S. Ramachandra Rao and Justice Rajesh Shankar set aside the reassessment order and remanded the matter back to respondent no. 4 for fresh consideration. The Court further directed that a notice under Section 148A must now be served upon the petitioner at the address indicated in the writ petition, in compliance with statutory requirements, before any further proceedings are initiated.

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