Case Note & Summary
The Commissioner of Income Tax filed an appeal under Section 260A of the Income Tax Act, 1961, against an order of the Income Tax Appellate Tribunal (ITAT), Mumbai Bench, dated 20/10/2005. The appeal pertained to assessment years 1991-92, 1992-93, 1993-94, 1994-95, 1997-98, and 1998-99. The core issue was whether a notice under Section 21 of the E.T. Act (presumably the Expenditure Tax Act, 1987) issued by the Commissioner but signed by the Assistant Commissioner was defective and whether such defect was curable. The ITAT had held that the notice was defective and the defect was incurable. The Revenue argued that the signing was an administrative act and did not vitiate proceedings unless prejudice was shown. The High Court, after hearing both sides, dismissed the appeal, holding that the notice under Section 21 must be signed by the Commissioner personally; signing by the Assistant Commissioner is a jurisdictional defect that cannot be cured. The court emphasized that the defect goes to the root of the matter and cannot be remedied by subsequent hearing or lack of prejudice. The substantial questions of law were answered against the Revenue, and the appeal was dismissed with no order as to costs.
Headnote
A) Income Tax - Notice under Section 21 of the E.T. Act - Defective Notice - The notice under Section 21 of the E.T. Act must be signed by the Commissioner personally; signing by the Assistant Commissioner renders the notice defective and the defect is incurable, vitiating the proceedings. (Paras 1-10) B) Income Tax - Curable Defect - Substantial Compliance - The defect of non-signing by the Commissioner is not a mere irregularity but a jurisdictional defect; substantial compliance cannot be invoked to cure the absence of personal signature. (Paras 5-8) C) Income Tax - Natural Justice - Prejudice - Even if the assessee was heard and no prejudice was caused, the defect in the notice cannot be cured as it goes to the root of jurisdiction. (Paras 6-9)
Issue of Consideration
Whether the notice under Section 21 of the E.T. Act issued by the Commissioner but signed by the Assistant Commissioner is defective and whether such defect is curable.
Final Decision
Appeal dismissed. The notice under Section 21 of the E.T. Act must be signed by the Commissioner personally; signing by the Assistant Commissioner is a jurisdictional defect that is incurable. No order as to costs.
Law Points
- Notice under Section 21 of the E.T. Act must be signed by the Commissioner personally
- defect in signing is not curable
- substantial compliance not applicable
- natural justice not cured by hearing
