2013 (9) TMI 734 - HC - Income Tax

Court affirms validity of income tax notices under Section 143(2) and emphasizes statutory timelines

The court upheld the validity of the notices dated 22.5.1992 and 17.8.1993 issued under Section 143(2) of the Income Tax Act, 1961, dismissing the ... Service of Notice u/s 143(2) within the time limit – Held that:- The onus to rebut the presumption of service of notice sent by post, lies upon the petitioner. The petitioner has failed to discharge this onus. The bald denial by the petitioner that notice was never received, in our considered opinion, is insufficient, to record a finding in favour of the petitioner - No reason to accept the petitioner's averments and submissions that notice dated 22.5.1992 was not served upon the petitioner, within the period of 12 months prescribed by the proviso to Section 143 (2) of the Act – Petition dismissed – Decided against the Assessee. Issues:1. Validity of notices dated 22.5.1992 and 17.8.1993 under Section 143(2) of the Income Tax Act, 1961.2. Dispute regarding service of notices for assessment years 1990-91 and 1991-92.3. Presumption of service under Section 27 of the General Clauses Act, 1897.4. Interpretation of the proviso to Section 143(2) regarding the period for serving notices.Analysis:1. The petitioner sought to quash notices dated 22.5.1992 and 17.8.1993 issued under Section 143(2) of the Income Tax Act, 1961, alleging that the notice for reassessment was served after the prescribed period of 12 months from the end of the month in which the return was furnished. The petitioner contended that the notice issued on 22.5.1992 was not received, and the subsequent notice on 17.8.1993 was served beyond the statutory timeframe. The petitioner relied on a Supreme Court judgment to support the argument that the notice should be served within one year from the date of filing the return.2. The dispute centered around the issuance and service of notices under Section 143(2) for assessment years 1990-91 and 1991-92. The revenue asserted that notices dated 22.5.1992 were dispatched to the petitioner, supported by dispatch records. The petitioner denied receiving these notices and argued that the notices were not served within the stipulated timeframe. The revenue's contention was that the notices were dispatched together and complied with, raising a presumption of service under Section 27 of the General Clauses Act, 1897.3. The court considered the petitioner's denial of receiving the notices insufficient to rebut the presumption of service through post under Section 27. The burden to prove non-receipt of the notices was on the petitioner, which was not discharged adequately. The court emphasized that mere denial without concrete evidence was inadequate to challenge the presumption of service, especially when supported by dispatch records and compliance by the assessee.4. Regarding the interpretation of the proviso to Section 143(2), the court clarified that the judgment cited by the petitioner did not apply directly to the case at hand. While acknowledging the importance of timely service of notices, the court focused on whether the notices were issued and served within the prescribed 12-month period. As the petitioner failed to provide substantial evidence to refute the presumption of service, the court found no error in the impugned order and dismissed the petition.In conclusion, the court upheld the validity of the notices and dismissed the petition, emphasizing the importance of complying with statutory timelines for serving notices under the Income Tax Act.