Tribunal upholds Revenue's appeal on reassessment validity, dismisses assessee's cross-objections. Importance of section 292BB and assessee participation.

The Tribunal allowed the Revenue's appeal, upholding the validity of reassessment proceedings as the notice under section 143(2) was issued and served. The Tribunal dismissed the assessee's cross-objections, ruling them not maintainable due to non-adjudication of grounds by the Commissioner of Income-tax (Appeals). The decision highlighted the relevance of section 292BB and the significance of the assessee's participation in assessment proceedings.

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Issues Involved:
1. Validity of reassessment proceedings due to non-issuance of notice under section 143(2).
2. Applicability of section 292BB regarding the preclusion of objections on non-service of notice.
3. Participation of the assessee in assessment proceedings and its implications.
4. Validity of cross-objections filed by the assessee.

Issue-Wise Analysis:

1. Validity of Reassessment Proceedings Due to Non-Issuance of Notice under Section 143(2):
The Commissioner of Income-tax (Appeals) quashed the reassessment proceedings on the ground that the Assessing Officer had not issued a notice under section 143(2) within the prescribed time. The Commissioner relied on decisions such as CIT v. Lunar Diamonds Ltd. [2006] 281 ITR 1 (Delhi), Asst. CIT v. Hotel Blue Moon [2010] 321 ITR 362 (SC), and CIT v. CPR Capital Services Ltd. [2011] 330 ITR 43 (Delhi). It was concluded that omission to issue notice under section 143(2) is not a procedural irregularity but a jurisdictional defect, rendering the assessment order void.

2. Applicability of Section 292BB Regarding the Preclusion of Objections on Non-Service of Notice:
The Revenue argued that the assessee, having participated in the assessment proceedings without raising any objection, is precluded from raising such objections later due to the provisions of section 292BB. The Tribunal noted that section 292BB, inserted by the Finance Act, 2008, precludes the assessee from raising objections regarding non-service of notice if they have participated in the proceedings. The Tribunal held that the case is governed by section 292BB, and mere non-service of notice does not render the assessment order null and void.

3. Participation of the Assessee in Assessment Proceedings and Its Implications:
The Tribunal observed that the assessee had participated in the assessment proceedings and complied with the questionnaire issued under section 142(1). The Tribunal emphasized that participation in the proceedings implies that the notice under section 143(2) was issued. The Tribunal further stated that the burden of proving non-issuance of notice lies on the assessee, which was not discharged. The Tribunal concluded that there was a valid issue and service of notice under section 143(2).

4. Validity of Cross-Objections Filed by the Assessee:
The assessee filed cross-objections challenging the non-adjudication of various grounds by the Commissioner of Income-tax (Appeals). The Tribunal noted that cross-objections can only be filed against an order or part thereof that has been adversely decided. Since the Commissioner of Income-tax (Appeals) had not adjudicated the grounds related to the validity of reassessment proceedings and merits of the additions, the Tribunal held that the cross-objections were not maintainable and dismissed them.

Conclusion:
The Tribunal allowed the appeal filed by the Revenue, holding that the reassessment proceedings were valid as the notice under section 143(2) was issued and served. The Tribunal dismissed the cross-objections filed by the assessee as they were not maintainable due to the non-adjudication of the grounds by the Commissioner of Income-tax (Appeals). The decision emphasized the applicability of section 292BB and the implications of the assessee's participation in the assessment proceedings.

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