Without serving a proper and valid notice u/s 148 of the Act, Assessment order u/s 147 is bad in law.

An assessment order under Section 147 of the Income Tax Act is considered invalid if a proper and valid notice under Section 148 was not served on the assessee. In this case, the Assessing Officer (AO) issued a notice under Section 148, but it was served on the assessee's wife after the assessee had passed away. The wife stated she had no information regarding the notice, rendering the subsequent assessment order legally unsound.

IN THE INCOME TAX APPELLATE TRIBUNAL
Hyderabad SMC Bench, Hyderabad
(Through Video Conferencing)

Before Smt. P. Madhavi Devi, Judicial Member
ITA No.1757/Hyd/2019
Assessment Year: 2011-12

Smt.Surat Lalitha Devi
Hyderabad
PAN:BALPL0921R
(Appellant) 

Vs. 

Income Tax Officer
Ward 9(1)
Hyderabad
(Respondent)

Assessee by: Sri K.A. Sai Prasad
Revenue by: Sri Sitarama Rao, DR

Date of hearing: 07/01/2021
Date of pronouncement: 08/01/2021

ORDER

This is assessee’s appeal for the A.Y 2011-12 against the order of the CIT (A)-7, Hyderabad, dated 7.10.2019.

2. Brief facts of the case are that the assessee, an individual along with six other family members, had sold an immovable property through registered sale deed documentNo.1051/2010 dated 19.04.2010 for an amount of Rs.80.00 lakhs as against the market value fixed by the Stamp Duty Authority at Rs.1,02,05,740/-. Since the value of the property is more than thesale consideration, the AO verified the registered sale deed and found that the difference of stamp duty was paid by the assessee’s group i.e. Vendors. Therefore, he was of the opinion that as perthe provisions of section 50C, the market value of the property is to be adopted as consideration for the purpose of computing at the capital gains. Since the assessee did not file his return ofincome for the year under consideration and has not offered thecapital gains to tax, the AO issued a notice u/s 148 of the Act on 23.3.2018 which was served on the assessee’s wife on 27.03.2013. Subsequently, assessee’s wife appeared before theAO and submitted a letter stating that the assessee has expired on 9.8.2018 and that she does not have any information regarding the said notice.

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