S. 147 : Reassessment-Failure to dispose of objections to reopening by a separate speaking order before completion of assessment- Additional grounds-Reassessment void and liable to be quashed. [S. 69C, 143(3), 148]
The assessee challenged the validity of the reassessment on the ground that although objections were filed against the reasons recorded for reopening, the Assessing Officer completed the reassessment without first disposing of the objections by a separate speaking order. The Assessing Officer proceeded to frame the reassessment under section 147 read with section 143(3) and made an addition under section 69C. The Tribunal admitted the additional legal ground as it went to the root of the assumption of jurisdiction. Following the decision of the Supreme Court in GKN Driveshafts (India) Ltd. v. ITO (2002 ) 259 ITR 19(SC) , as explained by the Bombay High Court in KSS Petron Pvt. Ltd. (ITA No. 224 of 2014 order dated 3.10.2016) and the Madras High Court in Jayanthi Natarajan v. ACIT,(2018)401 ITR 215 / 100 taxamnn.com 511 (Mad)(HC) the Tribunal held that passing a separate speaking order on the objections is a mandatory jurisdictional requirement. Since the Revenue failed to establish that such an order had been passed before completion of the reassessment, the entire reassessment proceedings stood vitiated. Accordingly, the reassessment order was quashed and the other grounds on merits were left open. (ITA No. 2714/Mum/2026, dated 31-7-2026) (AY. 2012-13)
Ashish Gems v. ACIT (Mum.)(Trib.) www.itatonline.org
[Coram : Hon’ble Shri Anikesh Banerjee, JM and Hon’ble Shri Bijayananda Pruseth, AM]