TaxTMI 
TaxTMI 
2008 (5) TMI 321
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..... In compliance to said notice, the learned counsel for the assessee attended and sought adjournment through letter dt. 8th Nov., 2002 on the ground that the notice under s. 143(2) was served on 1st Nov., 2002. The assessee had also raised validity of service of notice under s. 143(2) which was disposed of by the AO while passing the assessment order under s. 143(3) dt. 30th Jan., 2004 wherein the AO held that the first notice was issued on the address given in the return of income i.e. at 55/124, General Ganj, Kanpur, but the same was not served at the given address and thereafter the notice under s. 143(2) was sent at the address "32/2, New Fatehpura, Udaipur (Rajasthan)". The relevant observations made by the AO are as under: "The assessee has stated in his written reply dt. 30th Dec., 2003 that notice under s. 143(2) was served upon him on 1st Nov., 2001 and the same must have been seized within 12 months from the date of filing of return. The contention of the assessee is not legally correct because the notice under s. 143(2) was sent on the address given on the return of income. But it was not served that is why the notice under s. 143(2) dt. 28th Oct., 2002 was sent by po....
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....arly a wilful fault of the assessee. On this ground alone the assessee in question does not deserve to be given any benefit on this score. It is also pertinent to mention here that not only return has been filed on 29th Oct., 2001 but the same has been filled in by the assessee on 20th Oct., 2001 i.e. much after he has left premises No. 55/124, General Ganj, Kanpur. Copy of challan dt. 16th Oct., 2001/19th Oct., 2001 for Rs. 1,09,400 enclosed with the return also shows the address as 55/124, General Ganj, Kanpur only. Assessee therefore, cannot take a fresh plea that return though submitted to the Department on 29th Oct., 2001 was filed in fresh plea that return though submitted to the Department on 29th Oct., 2001 was filled in by him prior to 1st Oct., 2001 i.e. before change of address and hence the mistake of mentioning the incorrect address since all the three dates, i.e., date of filing, date of preparation of return and date of challan are much after 1st Oct., 2001 when the assessee shifted to new address i.e. 16/12, Civil Lines, Kanpur. In spite of the facts as discussed above the AO was able to issue the notice under s. 143(2) at Udaipur address of the assessee. A co....
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....le the same must have been served within 12 months from the date of filing of return. The AO has mentioned in the assessment order that the contention of the appellant was not legally correct because the notice under s. 143(2) was sent on the address given on the return of income but it could not be served and therefore the notice under s. 143(2) dt. 28th Oct., 2002 was sent by post on 28th Oct., 2002 at Udaipur address well within time. The proviso to cl. (ii) of sub-s. (2) of s. 143 as under: 'Provided that no notice under cl. (ii) shall be served on the assessee after the expiry of twelve months from the end of the month in which the return is furnished.' In the present case the notice has been served on 1st Nov., 2002 which is clearly beyond the time provided in the provision to cl. (ii) of sub-s. (2) of s. 143. The word used in the proviso is 'served'. The AO in his report has not denied the fact that the notice under s. 143(2) was served for the first time on the appellant on 1st Nov., 2002. Vide my letter dt. 14th Sept., 2005 I had asked the AO to send his comments along with case records after duly flagging them pointing out the evidence to show that the notice under ....
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.... speed-post on 28th Oct., 2002, that should be the deemed date of service. could not be accepted in view of the decision of Hon'ble Delhi High Court in the case of CIT vs. Bhan Textiles (P) Ltd. (2007) 208 CTR (Del) 253 : (2006) 287 ITR 370 (Del). He also relied on the following decisions: (i) Dy. CIT vs. Mahi Valley Hotels & Resorts (2006) 201 CTR (Guj) 308 : (2006) 287 ITR 360 (Guj); (ii) CIT vs. Lunar Diamonds Ltd. (2005) 197 CTR (Del) 312 : (2006) 281 ITR 1 (Del); (iii) Avadh Automobiles (P) Ltd. vs. Dy. CIT (ITA No. 864/ All/2000. dt 18th Jan., 2008); (iv) Smt. Bandana Gogoi vs. CIT (2007) 209 CTR (Gau) 31 : (2007) 289 ITR 28 (Gau); (v) CIT vs. Vardhman Estate (P) Ltd. (2007) 208 CTR (Del) 251 : (2006) 287 ITR 368 (Del); (vi) CIT vs. C. Palaniappan (2006) 284 ITR 257 (Mad); (vii) CIT vs. M. Chellappan & Anr. (2005) 198 CTR (Mad) 490 : (2006) 281 ITR 444 (Mad); (viii) Bapalal & Co. Exports vs. Jt. CIT (2007) 208 CTR (Mad) 330 : (2007) 289 ITR 37 (Mad); (ix) Vipan Khanna vs. CIT (2002) 175 CTR (P&H) 335 : (2002) 255 ITR 220 (P&H); (x) Raj Kumar Chawla & Ors. vs. ITO (2005) 92 TTJ (Del)(SB) 1245 : (2005) 277 ITR 225 (Del)(SB)(AT); (xi) Bhagat Sing....
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....nbsp; Sd/- Date: 8th Nov., 2002 Advocate" 13. From the perusal of above letter, it would be clear that the assessee has categorically stated in the above letter that notice under s. 143(2) was served on him on 1st Nov., 2002. It is also relevant to state that the assessee challenged the validity of proceedings before the AO vide para 3 of reply dt. 16th Dec., 2003 and para 2 of reply dt. 30th Dec., 2003 filed before the AO during the course of assessment proceedings. Admittedly, the assessment order under s. 143(3) has been passed on 30th Jan., 2004. In the assessment order, the AO has mentioned that since notice under s. 143(2) was sent on the address given by the assessee on the return of income, but it was not ser....
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.... the AO and the AO had not brought any material on record to show that notice was served on the assessee within the stipulated period of twelve months from the end of the month in which return is furnished. In our view, the burden was upon the Revenue to prove that notice was served on the assessee within the prescribed time. The Revenue has failed to prove its case in this regard. In our considered view, the learned CIT(A) was justified in annulling the assessment order. In the case of CIT vs. Lunar Diamonds Ltd., the Hon'ble Delhi High Court has held as under: "Held, dismissing the appeal, that the assessee had filed an affidavit stating that it had not received the notice and the Tribunal rightly held that under these circumstances, the burden was upon the Department to prove that notice was served upon the assessee within the prescribed time. The. Department had failed to prove its case in this regard. The Tribunal was right in setting aside the order of assessment. No substantial question of law arose from its order." 16. In the present case also there is no proof on record to suggest that notice was served on the assessee on or before 31st Oct., 2002. 17. At this sta....
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....framed on 21st Jan., 2000 is bad in law and void ab initio. This will answer question Nos. 1 and 2." 19. In the above mentioned decision, the Tribunal held that Revenue has to establish the service of notice under s. 143(2) on the assessee within the stipulated time prescribed under proviso to s. 143(2)(ii), i.e., twelve months from the end of the month in which the return is furnished. In the instant case also, the Revenue has not been able to* discharge such burden as no evidence regarding service of notice has been produced. 20. In the judgment relied upon by the learned Departmental Representative in the case of CIT vs. Gyan Prakash Gupta it was held that failure to serve notice under s. 143(2) would not make an assessment void ab initio. It was further held that assessment cannot be annulled. 21. It is relevant to state that majority of the High Courts, i.e., Hon'ble Delhi High Court and Hon'ble Gujarat High Court held that notice under s. 143(2) must be served on assessee before the stipulated period, i.e., within twelve months. The Hon'ble Courts have also held that burden is on Revenue to prove the service of notice within time. In absence of such proof, assessment....