Section 143(2), 158BC of Income Tax Act, 1961— In the present case, before ITAT, there were Appeals filed by both, the Assessee as well as the Revenue which came to be disposed of by impugned Judgment and Order dated 10.12.2007. The Assessee had specifically raised a preliminary objection to the assessment proceedings on the grounds that no notice under Section 143(2) of the Income Tax act, 1961 was ever issued to them. This objection was noted by the ITAT. However, this objection was not decided by the ITAT because the ITAT deemed it appropriate to grant the Assessee relief on other grounds, i.e. the ground that this was not a case of “undisclosed income”, which was regarded as one of the prerequisite for assessment under this Chapter.

The Assessee seeks to urge the ground based upon non-service of notice under Section 143(2) of the Income Tax Act, 1961.

Held that— The issue relating to service of notice under Section 1432(2) of the Income Tax Act is a issue which goes to the root of the matter. In Hotel Blue Moon( supra), the Hon'ble Supreme Court has now held that issuance of notice under Section 143(2) of the Income Tax Act, 1961 is a mandatory requirement and not some mere procedural irregularity and the same can be said to be curable. In its decision the Apex Court in clear terms has held that the omission on the part of the Assessing Authority to issue notice under Section 143(2)cannot be regarded as a procedural irregularity and the same is not curable and such requirement cannot be dispensed with. Hon'ble Apex Court has held that even for the purpose of Chapter XIV-B of the Income Tax Act for determining of undisclosed income for block assessment in proceedings under Section 158BC, provisions of Section 142, 143(2) and 143(3) are applicable and no assessment can be made without issuing notice under Section 142 of the said Act.[THE COMMISSIONER OF INCOME TAX, PANAJI, GOA VERSUS M/S. FOMENTO FINANCE AND INVESTMENT PVT. LTD.,] [2019] 17 ITCD Online (33) [BOMBAY HIGH COURT]