ITAT Quashes Reassessment Over Defective & Unsigned Income Tax Notice

ITAT quashed a reassessment initiated under Section 148 of the Income Tax Act, 1961, on the ground that the Assessing Officer neither manually nor digitally signed the notice issued. The unsigned notice dated 31.03.2018 formed the very basis of the proceedings, which culminated in an assessment under Section 147/143(3) for AY 2011–12. The case arose after the assessee’s return was reopened through a notice dated 31.03.2018, eventually leading to a reassessment order. Aggrieved by the reassessment and the additions made thereafter, the assessee took the matter to the CIT(A), who upheld the AO’s decision.

Issue Raised: Can a reassessment proceeding under Section 148 of the Income Tax Act be legally sustained if the Assessing Officer does not digitally or manually sign the notice, as required by Section 282A?

Tribunal’s Order: The assessee produced the unsigned notice before the Tribunal and contended that it lacked legal sanctity under Section 282A(1), which mandates that any notice or communication issued by an Income Tax authority must be signed, physically or digitally. In support, the assessee relied on multiple rulings, including Vikas Gupta v. Union of India, Prakash Krishnavtar Bhardwaj v. ITO, and DCIT v. Taureg Properties.

The tribunal relied on the HC’s reasoning, whereby it was held that the use of the word “shall” in Section 282A made signing of such notices a mandatory legal requirement. A document without a valid signature cannot be said to have been issued in law. The ITAT observed that since the notice was unsigned, it never acquired legal force, and the entire reassessment proceedings were rendered void ab initio.

Accordingly, the reassessment order was set aside and the appeal allowed in favour of the assessee.