Notice under section 143(2) of the Income-tax Act is a critical stage in the assessment process. It is the statutory gateway through which the Assessing Officer assumes jurisdiction to scrutinise a return of income. While receiving a 143(2) notice often causes concern, it is important to understand that not every notice is legally valid, and many assessments fail solely because the notice itself is defective.
This article explains what section 143(2) provides, when a notice is legally valid, and the situations in which it can be challenged successfully.
What Section 143(2) Means in Simple Terms
Section 143(2) empowers the Assessing Officer to call upon the assessee to produce evidence and explanations in support of the return filed. In essence, it is a scrutiny notice.
However, the power to scrutinise is not automatic. The law strictly requires that:
- A valid return must first be filed
- The notice must be issued within the prescribed time
- The notice must be issued by the correct jurisdictional Assessing Officer
- The notice must be properly served
If any of these conditions are missing, the very foundation of the assessment collapses.
Time Limit for Issuing a Notice under Section 143(2)
One of the most litigated aspects of section 143(2) is limitation.
A notice under section 143(2) must be issued:
- Within three months from the end of the financial year in which the return is furnished
If the notice is issued even one day late, it is invalid in law. Courts have consistently held that this time limit is mandatory and jurisdictional, not procedural.
Once the limitation period expires, the Assessing Officer loses the power to scrutinise the return altogether.
When a Notice under Section 143(2) Is Valid
A notice under section 143(2) is legally valid only if all the following conditions are satisfied:
1. Issued Within the Prescribed Time
As discussed above, limitation is non-negotiable. A time-barred notice is void.
2. Issued by the Correct Jurisdictional Assessing Officer
The notice must be issued by the Assessing Officer who has lawful jurisdiction over the assessee.
A notice issued by:
- A non-jurisdictional officer, or
- An officer without proper transfer of jurisdiction
is invalid and cannot be cured later.
3. Issued After a Valid Return Is Filed
A 143(2) notice can be issued only after a return of income is filed.
If:
- No return is filed, or
- The return is treated as invalid (for example, a defective return not cured),
then issuance of a 143(2) notice is without authority of law.
4. Properly Served on the Assessee
The notice must be properly served, whether:
- Through the income-tax portal
- By registered email
- Or by physical service (where applicable)
Non-service or improper service vitiates the assessment proceedings.
When a Notice under Section 143(2) Can Be Challenged
A 143(2) notice is open to challenge in several well-recognised situations.
1. Notice Issued Beyond Limitation
This is the strongest and most common ground. If the notice is issued after the statutory deadline, the entire assessment becomes void ab initio.
2. Notice Issued by a Non-Jurisdictional Officer
Jurisdiction is the root of authority. A notice issued by an officer who does not have jurisdiction over the assessee is invalid, even if the assessment is later completed by the correct officer.
3. No Valid Return on Record
If the return was:
- Never filed, or
- Treated as invalid due to unresolved defects,
the issuance of a 143(2) notice is without legal basis.
4. Improper or Non-Service of Notice
If the assessee can demonstrate that:
- The notice was never served, or
- Served at an incorrect address, or
- Uploaded incorrectly on the portal,
the assessment proceedings fail for violation of principles of natural justice.
5. Mechanical or Casual Issuance
Courts have frowned upon mechanical issuance of notices without application of mind, especially in cases involving mass or automated scrutiny selection, where jurisdictional or procedural safeguards are ignored.
Consequences of an Invalid 143(2) Notice
If a notice under section 143(2) is held to be invalid:
- The entire assessment framed pursuant to such notice is void
- The defect is not curable
- Participation by the assessee does not validate an illegal notice
Jurisdictional defects go to the root and cannot be waived.
Practical Strategy for Assessees
On receiving a notice under section 143(2), an assessee should:
- Verify the date of filing of return
- Check the date of issuance of notice
- Confirm jurisdiction of the issuing officer
- Ensure proper service
- Raise objections at the earliest opportunity
Early objection strengthens the assessee’s position and avoids prolonged litigation.
Conclusion
A notice under section 143(2) is not a mere formality. It is the legal foundation of scrutiny assessment. While the department has wide powers to examine returns, those powers are strictly conditioned by law.
Where the notice is issued beyond limitation, by the wrong officer, without proper service, or without a valid return on record, the entire assessment is liable to be quashed. Understanding these fundamentals empowers taxpayers to protect their rights and ensures that scrutiny proceedings remain within the bounds of law.
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