Tribunal upholds CIT(A)'s decisions on assessment proceedings, dismisses appeals under Sections 143(2), 147/148.

The tribunal dismissed both the Revenue's and the assessee's appeals, upholding the CIT(A)'s decisions. The assessment proceedings were annulled due to the non-service of notice under Section 143(2), and directions for reassessment under Sections 147/148 were affirmed. The tribunal found no merit in the arguments presented by either party and did not interfere with the CIT(A)'s orders.

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Issues Involved:
1. Acceptance of additional evidence by CIT(A) in contravention to Rule 46A.
2. Annulling of assessment proceedings under Section 143(2) due to non-service of notice.
3. Non-adherence to the decision of Madras High Court in V. Raju vs. CIT.
4. Ignoring provisions of Section 124(3)(a) regarding jurisdictional challenge.
5. Directions under Section 150 for reassessment under Sections 147/148.

Detailed Analysis:

1. Acceptance of Additional Evidence by CIT(A):
The Revenue's appeal contended that the CIT(A) erroneously accepted additional evidence submitted by the assessee without giving the Assessing Officer (A.O.) a proper opportunity to rebut the claim, violating Rule 46A of the I.T. Rules. The tribunal noted that the CIT(A) had examined the case records and found that the notice under Section 143(2) dated 18/05/2005 was not served on the assessee or any authorized person. This finding was not controverted by the Revenue, leading to the dismissal of this ground.

2. Annulling of Assessment Proceedings under Section 143(2):
The CIT(A) annulled the assessment proceedings on the technical ground that the notice under Section 143(2) was not served on the assessee. The tribunal upheld this decision, as the Revenue failed to produce any evidence to counter the CIT(A)'s finding that the notice was not served. Consequently, the tribunal did not interfere with the CIT(A)'s order on this issue.

3. Non-Adherence to Madras High Court Decision:
The Revenue argued that the CIT(A) did not follow the ratio of the Madras High Court decision in V. Raju vs. CIT. However, the tribunal did not find any specific argument or evidence from the Revenue to support this claim, leading to the dismissal of this ground.

4. Ignoring Provisions of Section 124(3)(a):
The Revenue claimed that the CIT(A) ignored Section 124(3)(a), which debars the assessee from questioning the jurisdiction of the A.O. after the expiry of the time allowed by the notice under Section 142(1). The tribunal did not find any merit in this argument as the primary issue was the non-service of the notice under Section 143(2), which was not addressed by the Revenue.

5. Directions under Section 150 for Reassessment under Sections 147/148:
The assessee's appeal challenged the CIT(A)'s directions to the A.O. to take recourse to Sections 147/148 for reassessment, arguing that such directions were beyond the ambit of Section 150. The tribunal found no force in this contention, stating that Section 150 lifts the bar of limitation for reassessment and the CIT(A)'s reference to this section was to clarify the extended time for reopening the assessment.

The assessee also argued that the CIT(A) could not term the amount of Rs. 25,50,000 as 'escaped income' without adjudicating on its merits. The tribunal held that for invoking Section 147, it is sufficient if the A.O. has reason to believe that income has escaped assessment, and a conclusive finding is not required at this stage. The tribunal upheld the CIT(A)'s directions for reassessment, stating that the actual taxability of the income would be determined in the reassessment proceedings.

Conclusion:
Both the appeals of the Revenue and the assessee were dismissed. The tribunal upheld the CIT(A)'s decisions on all counts, including the annulment of the assessment proceedings due to non-service of notice under Section 143(2) and the directions for reassessment under Sections 147/148. The tribunal found no merit in the arguments presented by the Revenue and the assessee, and no interference was made in the CIT(A)'s orders.

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