Assessee wins appeal against notice & penalty for improper assessment. Revenue's appeal dismissed.

The Tribunal allowed the assessee's appeal against the improper notice under section 148 and the consequent penalty under section 271(1)(c) for assessment year 2002-03. The appeal of the Revenue was dismissed as it became infructuous due to the quashing of the Assessing Officer's order.

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Issues Involved:
1. Notice under section 148 of the Income Tax Act instead of notice under section 143(2) for assessment year 2002-03.
2. Appeal against the order of the Commissioner of Income Tax (Appeals) sustaining the penalty under section 271(1)(c) of the Act.

Issue 1: Notice under section 148 instead of section 143(2):
The case involved a dispute regarding the issuance of a notice under section 148 of the Income Tax Act instead of section 143(2) for assessment year 2002-03. The assessee contended that the Assessing Officer issued the notice under section 148 merely to extend the assessment period. The assessee argued that since the revised return was filed within the time limit, the notice under section 148 was unnecessary. The Tribunal analyzed the relevant provisions of the Act and held that the notice under section 148 was not in accordance with the law. The Tribunal emphasized the distinct purposes of notices under section 143(2) and section 148, highlighting that the scope of assessment under section 148 is narrower. Relying on judicial precedents, the Tribunal concluded that the notice under section 148 was improper and quashed the order of the Assessing Officer.

Issue 2: Appeal against penalty under section 271(1)(c):
The appeal also involved a challenge to the penalty imposed under section 271(1)(c) for assessment year 2002-03. However, since the Tribunal had already quashed the Assessing Officer's order pertaining to the notice under section 148, the penalty was also deleted. Consequently, the Tribunal allowed the assessee's appeal against the penalty.

In conclusion, the Tribunal allowed the assessee's appeal against the improper notice under section 148 and the consequent penalty under section 271(1)(c). The appeal of the Revenue was dismissed as it became infructuous due to the quashing of the Assessing Officer's order. The Tribunal's decision was pronounced on May 5, 2016, by the Vice President and the Accountant Member of the Appellate Tribunal ITAT Chandigarh.

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