Appeal Allowed: Assessment Invalid, Notice Time-Barred

The Tribunal allowed the appeal of the assessee, holding that the assessment should have been framed under section 153C read with section 153A instead of section 143(3). It also found the notice under section 143(2) was served beyond the statutory time limit, rendering the assessment invalid. Therefore, the Tribunal ruled in favor of the assessee on legal grounds, dismissing other issues raised on merits.

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Issues Involved:
1. Validity of assessment under section 143(3) versus section 153C read with section 153A.
2. Timeliness and validity of notice under section 143(2).
3. Addition of Rs. 3,52,50,000 on account of alleged cash payment for property acquisition.
4. Admission of additional evidence under rule 46A.

Issue-wise Detailed Analysis:

1. Validity of Assessment under Section 143(3) versus Section 153C read with Section 153A:
The assessee challenged the validity of the assessment order passed under section 143(3) for the assessment year 2008-09, arguing that it should have been passed under section 153C read with section 153A. The search and seizure action conducted on 19/2/2008 on M/s B.L. Kashyap & Sons revealed unaccounted cash payments linked to the assessee-company. The Assessing Officer issued a notice under section 153C on 20/11/2009 after recording "satisfaction". The Tribunal observed that the assessment year 2008-09 should be considered within the six assessment years preceding the year of search, and thus, the assessment should have been framed under section 153C read with section 153A. The Tribunal relied on the judgment of the Hon'ble Delhi High Court in CIT vs. RRJ Securities Ltd., which held that the reference date for "other persons" under section 153C is the date of recording of satisfaction. Therefore, the assessment for 2008-09 could not be a regular assessment under section 143(3).

2. Timeliness and Validity of Notice under Section 143(2):
The assessee argued that the notice under section 143(2) was not served within the statutory time limit. The return of income was filed on 27/9/2008, and the last date for serving the notice under section 143(2) was 30/9/2009. However, the notice was issued on 1/12/2009. The Tribunal held that the issuance and service of the notice were beyond the statutory time limit, rendering the assessment order invalid. The Tribunal emphasized that without a valid notice under section 143(2), the assessment could not be sustained, citing the Supreme Court's decision in ACIT vs. Hotel Blue Moon.

3. Addition of Rs. 3,52,50,000 on Account of Alleged Cash Payment for Property Acquisition:
The assessee challenged the addition made by the Assessing Officer on account of alleged cash payment for property acquisition. However, since the Tribunal found the assessment itself invalid on legal grounds, the merits of this addition were not addressed, rendering this issue infructuous.

4. Admission of Additional Evidence under Rule 46A:
The assessee contended that the CIT(A) erred in not admitting additional evidence filed under rule 46A. However, this issue also became infructuous due to the Tribunal's decision on the invalidity of the assessment order.

Conclusion:
The Tribunal allowed the appeal of the assessee on legal grounds, holding that the assessment should have been framed under section 153C read with section 153A and that the notice under section 143(2) was not served within the statutory time limit. Consequently, the other grounds raised on merits were treated as dismissed. The order was pronounced on 28th November 2017.

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