Court quashes demand notice, allows appeal within 6 weeks. Proper service crucial for appeal rights. Limitation won't dismiss appeal. The High Court quashed the demand notice and allowed the petitioner to file an appeal against the assessment order within six weeks. The Court emphasized ...
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Court quashes demand notice, allows appeal within 6 weeks. Proper service crucial for appeal rights. Limitation won't dismiss appeal.
The High Court quashed the demand notice and allowed the petitioner to file an appeal against the assessment order within six weeks. The Court emphasized the importance of proper service, stating that the right to appeal depends on being served in accordance with the law. The appeal will not be dismissed based on limitation, and the assessment merits will be determined by the AAC. The petition was allowed with costs, with both judges concurring on the decision.
Issues involved: Impugning a notice u/s 139(2) of the Income Tax Act, 1961 for filing a return, service of assessment order and demand notice, validity of substituted service, right to file an appeal.
Impugned Notice u/s 139(2): The petitioner, a partner in a firm, challenged a notice issued by the ITO for filing a return, claiming it was not served properly. The ITO made an ex parte assessment without the petitioner's knowledge. The petitioner contended that the demand notice and assessment order were served by affixture, which was disputed by the petitioner.
Service of Notice and Demand: The crucial issue was whether the petitioner was served with the assessment order and demand notice. The petitioner claimed non-service in accordance with the law. The method of substituted service was used, but the department failed to show valid reasons for resorting to it. Proper service is essential for the right to file an appeal, a valuable right that should not be compromised.
Court's Decision: The High Court quashed the demand notice and allowed the petitioner to file an appeal against the assessment order within six weeks. Emphasizing the importance of proper service, the Court highlighted that the right to appeal hinges on being served in accordance with the law. The appeal will not be dismissed on the ground of limitation, leaving the assessment merits to be determined by the AAC.
Conclusion: The petition was allowed with costs, with both judges concurring on the decision.
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