TaxTMI 
TaxTMI 
2005 (5) TMI 262
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....e assessee refused to receive above notice. Fresh notices under the above provisions were also issued on 11-9-2000 and 12-2-2001 through registered post/speed post. These were returned with postal remarks "left without address". Finally, notice under section 143(2) dated 5-3-2001 was claimed to have been served on the assessee through affixture. As there was no response to the last notice, the Assessing Officer proceeded ex parte against the assessee and made assessment under section 144 of the Income-tax Act. 4. In the return, the assessee had claimed deduction under section 80HHC at Rs. 31,18,223. The Assessing Officer reduced above deduction to Rs. 13,98,533. He further added Rs. 5 lakhs on estimate basis for a new loan which was treated as unproved. This way assessment was made at total income of Rs. 20,84,570 against nil income returned by the assessee. 5. The assessee impugned above assessment in appeal before the CIT(A) and raised strong objection to the ex parte assessment made under section 144 of the Income-tax Act. The assessee claimed that he did not receive any notice from the Assessing Officer, The learned CIT(A) did not find any force in the above contention. He up....
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....Garden By Regd. Post Reed, back unserved 3. 30-9-1999 R-31, Rajouri Garden By Speed Post Reed, back with postal remarks no person is ready to receive it.' 4. 30-9-1999 T-32, Rajouri Garden By Speed Post Reed, back 'left' 4.(a) 30-9-1999 R-31 & T-32, Rajouri Garden By Notice Server Reed, with remarks of 'Refusal' 5. 11-9-2000 R-31, Rajouri Garden By Regd. Post 6. 12-2-2001 R-31, Rajouri Garden By Regd. Post Reed, back 7. 5-3-2001 R-31, Rajouri Garden By Notice Served Served through affixture Thereafter, the learned CIT(A) has further observed as under: "As regards the issues of the non-service of notices issued under section 143(2), the A.R. for the appellant has contended that since the appellant and its partners were not able to pay their outstanding liabilities of the sundry creditors not the huge bank loans, the sundry creditors had become restless and pestered the partners of the appellant to pay the dues. In view of this awful situation, the partners had no other alternative except to suspend the business of the appellant and to close down its office. In other words, the partners remained away from their office as w....
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....partners had suffered heavy losses and were running away from the creditors. They were not available at place of their business. At any rate, Assessing Officer did not treat notices at Sl. Nos. 1 to 6 as proper service and thought it necessary to serve notice on the assessee through affixture dated 5-3-2001. The said notice is claimed to have been served on the assessee by notice server Shri Satya Singh and witnessed by Ms. Indu Rani, Inspector of Income-tax Department. As there was no response to above notice, the Assessing Officer decided to proceed ex parte against the assessee. We have to determine whether above service through affixture was made in accordance with law. 9. In the case of State Bank of India v. Chandra Govindji [2000] 8 SCC 532, their Lordships of Supreme Court with reference to the question whether reasonable opportunity was afforded to the assessee or not, held that in such a situation the last date for which adjournment was sought is relevant and the question ordinarily should not be examined with reference to past adjournments granted in the case. The past need not be re-examined. 10. The principle laid down by their Lordships are applicable in this case. ....
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....rt." 12. In case of A.K. Kochnadi v. Agriculture ITO [1977] 110 ITR 406 (Ker.), their Lordships of Kerala High Court observed as under: "Where service of a notice on the assessee or his authorized agent or an adult member of his family is not possible, statutes authorize substituted service and such service attributes constructive knowledge, of the assessee. To attribute such constructive knowledge the substituted service must be in accordance with the prescribed procedure, that is, by section 64 of the Agricultural Income-tax Act, 1950, in this case, which provides that a notice can be served as if it were a summons issued by a court, that is, as provided in Order V, rules 17, 18 and 19 of the Code of Civil Procedure, 1908. In the absence of proof of service as required, in the said rule 17, such service could not be treated as valid service. A mere statement that service was effected by affixture would not be enough." 13. It is clear from above that constructive knowledge of notice can be attributed to the assessee if service has been effected as provided by the Statute. All the requirements of substituted service must be shown to be fully satisfied. In the case of Ramendra N....