The Principal Commissioner Of Income Tax vs Orissa Mining Corporation

2026 INSC 1171
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO………….OF 2026
( @ SPECIAL LEAVE PETITION (C) NO. 14546 OF 2023)
PRINCIPAL COMMISSIONER OF
INCOME TAX, BHUBANESHWAR ... APPELLANT (S)
VERSUS
ORISSA MINING CORPORATION LTD. …RESPONDENT(S)
WITH
Civil Appeal No…….. of 2026
(@ Special Leave Petition (C) No.25931 of 2026)

Civil Appeal No…….. of 2026
(@ Special Leave Petition (C) No.25932 of 2026)

Civil Appeal No…….. of 2026
(@ Special Leave Petition (C) No.3350 of 2024)

Civil Appeal No…….. of 2026
(@ Special Leave Petition (C) No.25882 of 2026)

J U D G M E N T
SANJEEV SACHDEVA, J.
1. Leave granted.
Signature Not Verified
Digitally signed by
Deepak Guglani
Date: 2026.10.28
18:51:02 IST
Reason:
2. As similar issues arise in all these appeals, and as such they have been
taken up for consideration together. Revenue has assailed different orders
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holding against the Revenue. Insofar as the respondent, Orissa Mining
Corporation Ltd. is concerned, the assessment years involved are 2008-09,
2010-11 and 2011-12. Whereas in the case of respondent, Bijoy Kishore
Mohanty, the assessment years involved are in the 2009-10 and 2010-11.
3. Common questions of law arising for consideration in all these appeals
are:
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(i) Whether Section 292BB of the Income Tax Act, 1961 precludes
an Assessee from raising an objection in any proceedings under
the Act regarding non-service of a notice under Section 143(2)
of the Act, if the Assessee had appeared and cooperated during
the reassessment proceedings and had not raised any objection
with regard to non-issuance of a notice under Section 143(2) of
the Act? and
(ii) Whether an Assessee who requests that the earlier Return of
Income filed under Section 139 of the Act be treated as the
Return of Income filed in response to a notice under Section 148
of the Act is not required to be given a notice under Section
143(2) of the Act?, and
(iii) Whether a letter given by the Assessing Officer during the course
of reassessment proceedings, requiring the Assessee to explain
the grounds on which re-assessment of income was proposed,
would tantamount to sufficient compliance of the provision of

1
‘The Act’ for short
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Section 143(2) of the Act?
4. In all these appeals, the Assessees had filed the respective Returns of
their Income for the respective Assessment years under Section 139 of the Act,
which were duly assessed, and assessment orders passed under Section 143(3)
of the Act. Subsequently, the Revenue sought to reopen the assessments under
Section 147 of the Act and issued notices under Section 148 of the Act,
requiring the assesses to file the returns in the prescribed form.
5. In the case of Orissa Mining Corporation Ltd., the Assessee filed a
response stating that its Return of Income originally filed under Section 139
of the Act, be treated as the Return of Income in response to a notice under
Section 148 of the Act. In the case of Bijoy Kishore Mohanty, it is stated that
the same Return of Income which had earlier been filed under Section 139 of
the Act, was refiled in response to the notice issued under Section 148 of the
Act.
6. Thereafter, admittedly no notice under section 143(2) of the Act was
issued and the reassessment proceedings were commenced. During the
reassessment proceedings, and notices under Section 142(1) of the Act were
issued to the Assessee, seeking documents/stock information to be submitted.
7. Pursuant thereto, the reassessment orders were framed against the
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Assessees, which were challenged by the Assessees by approaching the
Appellate Authority, i.e., Commissioner of Income Tax (Appeals). One of the
grounds raised by the Assessee before the Appellate Authority was with regard
to failure of the Revenue to issue a notice under Section 143(2) of the Act,
thereby vitiating the entire proceedings.
8. Appellate Authority rejected the argument of the Assessee with regards
to vitiation of the proceedings on account of failure of the Revenue to serve a
notice under Section 143(2) of the Act. Appellate Authority held that since the
Assessees had participated in the assessment proceedings after the issuance of
a notice under Section 148, followed by a notice under Section 142(1), the
Assessees could not be allowed to raise the ground of non-issuance of a notice
under Section 143(2) of the Act at the appellate stage.
9. Aggrieved therefrom, the Assesses approached the Income Tax
Appellate Tribunal. In the respective cases, the Appellate Tribunal held that
the assessment proceedings stood vitiated for want of notice under Section
143(2) of the Act and, thus, set aside the reassessment orders.
10. Aggrieved by the decisions of the Income Tax Appellate Tribunal, the
Revenue challenged the respective orders before the High Court. The High
Court had rejected the challenge, and upheld the orders of Income Tax
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Appellate Tribunal, confirming that the assessment proceedings were vitiated
on the ground of failure of the authority to issue a notice under Section 143(2)
of the Act.
11. Section 143 of the Act reads as under:
“143. (1) Where a return has been made under section 139, or in
response to a notice under sub-section (1) of section 142, such
return shall be processed in the following manner, namely: —
*
(2) Where a return has been furnished under section 139, or in
response to a notice under sub-section (1) of section 142, the
Assessing Officer or the prescribed income-tax authority, as the
case may be, if, considers it necessary or expedient to ensure that
the Assessee has not understated the income or has not computed
excessive loss or has not under-paid the tax in any manner, shall
serve on the Assessee a notice requiring him, on a date to be
specified therein, either to attend the office of the Assessing Officer
or to produce, or cause to be produced before the Assessing
Officer any evidence on which the Assessee may rely in support of
the return:
Provided that no notice under this sub-section shall be served on
the Assessee after the expiry of three months from the end of the
financial year in which the return is furnished.
(3) On the day specified in the notice issued under sub-section
(2), or as soon afterwards as may be, after hearing such evidence
as the Assessee may produce and such other evidence as the
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Assessing Officer may require on specified points, and after taking
into account all relevant material which he has gathered, the
Assessing Officer shall, by an order in writing, make an
assessment of the total income or loss of the Assessee, and
determine the sum payable by him or refund of any amount due to
him on the basis of such assessment:
Provided that
(4) ”
12. Section 143(2) of the Act mandates service of a notice on the Assessee,
requiring him to attend the office of the Assessing Officer or to produced
before the Assessing Officer any evidence on which the Assessee may rely in
support of the return. This Court, in Assistant Commissioner of Income Tax
2
and Another vs. Hotel Blue Moon has held that the omission on the part of
the Assessing Authority to issue a notice under Section 143(2) of the act
cannot be treated as a procedural irregularity that is curable, and therefore, the
requirement of issuing a notice under Section 143(2) of the Act cannot be
dispensed with.
13. This Court, in Hotel Blue Moon (supra) has specifically laid down that
where the Assessing Officer intends to make an enquiry, he must necessarily
follow the provisions of Section 142 and Section 143(2) & 143(3) of the Act.

2
(2010) 3 SCC 259
6

A notice under Section 143(2) of the Act is mandatory, as it grants the
Assessee an opportunity to produce or cause to be produced any evidence or
particulars based on which the Assessee claims relief. A notice under section
143(2) of the Act is sine qua non for a proceeding for reassessment under
Section 147 of the Act. In the absence of a notice under Section 143(2) of the
Act, no further proceedings can be undertaken by the Revenue.
14. In the present case, admittedly no notice under Section 143(2) of the
Act was admittedly issued. The excuse given by the Revenue is that such a
notice was not required to be given and failure to give such a notice is not fatal
to the reassessment proceedings. Reliance is placed by the Revenue on the
provision of Section 292BB of the Act, which reads as under:-
“ 292BB. Notice deemed to be valid in certain circumstances.
Where an Assessee has appeared in any proceeding or co-operated
in any inquiry relating to an assessment or reassessment, it shall
be deemed that any notice under any provision of this Act, which
is required to be served upon him, has been duly served upon him
in time in accordance with the provisions of this Act and such
Assessee shall be precluded from taking any objection in any
proceeding or inquiry under this Act that the notice was—
(a) not served upon him; or
(b) not served upon him in time; or
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(c) served upon him in an improper manner:
Provided that nothing contained in this section shall apply where
the Assessee has raised such objection before the completion of
such assessment or reassessment.”
15. Section 292BB creates a deeming fiction in respect of any proceedings
in which an Assessee had appeared or an inquiry in which the Assessee
cooperated relating to assessment or reassessment. The deeming fiction
stipulates that any notice required to be served upon the Assessee, under the
provision of the Act, shall be deemed to have been duly served upon him in
time and in accordance with the provisions of the Act, and the Assessee is
precluded from taking any objection that the notice was either not served upon
him, or not served upon him in time, or served upon him in an improper
manner. Said provision precludes an Assessee from raising an objection with
regards to service, timely service and proper service of a notice which is
required to be served upon him. Such a deeming fiction can come into play
only if notice is alleged to have been sent by the Revenue.
16. Only when the Revenue contends that a notice, as required under the
Act has been sent, the Assessee who has participated in the proceedings or
inquiry relating to assessment or reassessment, pursuant to the notice would
be precluded from taking any objection that the notice was not served upon
him, or was not served in time, or that the service of notice was not proper.
8

Said deeming fiction cannot come into play where the Revenue has admittedly
not even issued the notice. Where the Revenue itself contends that no notice
was sent, as required under the Act, the provision of Section 292BB will have
no applicability.
17. The Assessing Officer cannot undertake the proceedings of
reassessment under Section 143(3), read with Section 147 of the Act, unless a
notice under Section 143(2) of the Act has been issued to the Assessee. Mere
participation of the Assessee in the assessment proceedings, in the absence of
a notice under Section 143(2) of the Act, does not confer jurisdiction on the
Assessing Officer to frame an assessment under Section 143 (3) of the Act.
18. Furthermore, in response to a notice issued under Section 148 of the
Act, requiring the Assessee to file a Return of Income in the prescribed format,
the Assessee has the option to file a fresh Return of Income. In case the
Assessee does not wish to file a fresh Return of Income and seeks to rely upon
the Return of Income filed earlier under Section 139 of the Act, it is open to
the Assessee, in response to the notice under section 148 of the Act, to merely
state that its earlier Return of Income be treated as the Return of Income in
response to the notice and he remains bound by it. If the Assessee seeks to
reiterate its earlier Return of Income, it is not necessary for the Assessee to
refile a copy of its earlier Return of Income. In the present case, the Assessees
9

have chosen not to file a fresh return and have reiterated their Return of Income
already filed, Thus, the obligation on the Revenue to issue a notice under
Section 143(2) of the Act, requiring the Assessee to produce evidence on
which the Assessee seeks to rely on in support of the Return of Income, cannot
be dispensed with.
19. Furthermore, Section 143(3) of the Act empowers the Assessing
Officer to make an assessment after hearing such evidence as the Assessee
may produce and such evidence as the Assessing Officer may require on
specified points, pursuant to the notice issued under Section 143(2) of the Act.
20. Admittedly, in the present case, no notice issued under Section 143(2)
of the Act was issued to the Assessee for the respective assessment years.
Consequently, in terms of the law laid down by this Court in Hotel Blue Moon
(supra), the Assessing Officer could not have framed the assessments, and as
such the proceedings are vitiated. As held in Hotel Blue Moon (supra), the
omission on the part of the Assessing Authority to issue a notice under Section
143(2) of the Act is not a mere procedural irregularity and is not curable.
21. Furthermore, mere participation in the proceedings by the Assessees
does not come to the aid of the Revenue in terms of the Section 292BB of the
Act. Reference has been made to the judgment of this Court in Commissioner
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3
of Income Tax vs. Laxman Das Khandelwal , wherein this Court has held
that the scope of Section 292BB is to make service of notice, having certain
infirmities, to be proper and valid, if there was requisite participation on the
part of the Assessee. It does not save complete absence of notice and non-
issuance of notice under Section 143(2) of the act by the Revenue, and will
make the entire proceedings invalid.
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22. A letter given by the Assessing Officer under section 142 (1) of the

3
(2021) 18 SCC 691
4
Inquiry before assessment.
142. (1) For the purpose of making an assessment under this Act, the Assessing Officer
may serve on any person who has made a return under section 115WD or section 139
or in whose case the time allowed under sub-section (1) of section 139 for furnishing
the return has expired a notice requiring him, on a date to be therein specified, —
(i) *
(ii) to produce, or cause to be produced, such accounts or documents as the Assessing
Officer may require, or
(iii) to furnish in writing and verified in the prescribed manner information in such
form and on such points or matters (including a statement of all assets and liabilities
of the assessee, whether included in the accounts or not) as the Assessing Officer may
require:
Provided that—
(2) For the purpose of obtaining full information in respect of the income or loss of any
person, the Assessing Officer may make such inquiry as he considers necessary.
*
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Act during the course of reassessment proceedings would not satisfy the
requirements of a notice under section 143(2) of the Act. A notice under
section 143(2) of the Act is a sine qua non for commencing the proceedings.
A letter issued after commencing the proceedings would not cover up the
lacuna in the proceedings and would not validate what is non est .
23. In view of the above, we find no infirmity in the view taken by the
Income Tax Appellate Tribunal, as affirmed by the High Court. The question
of law raised are, thus, answered as under:
(i) Section 292BB of the Act does not preclude an Assessee from raising
an objection in any proceedings under the Act regarding non issuance
of a notice under Section 143(2) of the Act, merely because the
Assessee had appeared and cooperated during the reassessment
proceedings without raising any objection with regard to non-issuance
of the notice. and
(ii) The revenue is not absolved of its obligation to serve a notice under
Section 143(2) of the Act even if the Assessee requests that the earlier
Return of Income filed under Section 139 of the Act be treated as the
Return of Income filed in response to a notice under Section 148 of the
Act . and
(iii) Mere issuance of a letter by the Assessing Officer under section 142(1)
of the Act during the course of reassessment proceedings, requiring the
Assessee to explain the grounds on which re-assessment of income was
proposed, does not amount to sufficient compliance of the mandatory
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obligation to serve a notice under Section 143(2) of the Act.
24. Consequently, we find no merit in the appeals, and the appeals are
accordingly dismissed.

…………………….J.
[SANJAY KUMAR]


…………………………….J.
[SANJEEV SACHDEVA]
New Delhi;
October 28, 2026
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