2004 (5) TMI 259

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...., 1993. The assessee desired to know the reasons for reopening the assessment. In reply, the AO stated that assessee may examine the case records for this purpose. Thereafter the AO issued a notice under s. 142(1) on 29th Feb., 1996. The assessee had constructed a house property and the cost of construction was shown at Rs. 1,93,558. The AO referred the property to valuation cell of the Department for ascertaining the cost of construction, who determined the cost at Rs. 3,53,000. By relying on the report of Valuation Officer, the AO made an addition of Rs. 1,59,442 being unexplained investment in the house property and completed the assessment under s. 144 r/w s. 148 on 25th March, 1996. 3. Being aggrieved, the assessee carried the matter ....

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.... of the assessment order. The assessment order is, therefore, set aside for reframing and the AO will proceed further from para No. 6 of the assessment order and reframe the remaining part of the order, i.e. starting from para 6 of the assessment order in view of the aforesaid." Assessee is aggrieved by the order of CIT(A). Hence, this appeal before us. 4. The learned counsel for the assessee reiterated the submissions made before the authorities below. He submitted that in this case notice under s. 148 was issued on 23rd Sept., 1993. Thereafter, notices under s. 142(1) along with 143(2) were issued on 29th Feb., 1996 i.e. beyond the time allowed of 6 months or before the end of financial year from the end of month in which return was fil....

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.... notice, assessee stated that return filed earlier on 19th Nov., 1990 may be treated to have been filed in response to notice under s. 148. Such course of action on the part of assessee was perfectly legal and valid and the judgment of Hon'ble Rajasthan High Court in the case of Tiwari Kanhaiya Lal vs. CIT (1985) 47 CTR (Raj) 187 : (1985) 154 ITR 109 (Raj) also supports this view. Thus, issue of notice under s. 142(1)/143(2) within the prescribed limit fixed under the Act was mandatory. But, in this case, the AO has issued the notice under s. 143(2)/142(1) on 28th Feb., 1996, i.e., beyond the time allowed under the Act. This view finds support from the decision of Tribunal, Agra Bench in the case of Asstt. CIT vs. Baikunth Nath Singhal. Thu....