TaxTMI 
TaxTMI 
2007 (8) TMI 474
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....02 at a loss of Rs. 1,03,85,990. Certain additions were confirmed by the learned CIT(A) against which the assessee is in appeal while against certain deletion, revenue is in appeal before us. 4. The first ground raised by the assessee/appellant is against completion of assessment under section 143(3) without effective service of notice under section 143(2) before the time limit prescribed in the proviso below sub-section (2) of section 143. 5. The learned counsel for the assessee Shri Rajesh Malhotra submitted that in the present case two separate notices under section 143(2) are stated to have been issued. The first notice dated 29-10-2002 was handed over to notice server. The notice server is stated to have visited factory premises of the assessee on 31-10-2002. As per the report of notice server when he reached the premises of the assessee, the office is stated to be closed. He accordingly approached the Assessing Officer who directed to serve the notice by affixture. The Assessing Officer ordered that since notice under section 143(2) dated 29-10-2002 could not be served in the ordinary course as the assessee is deliberately avoiding service of notice, he directed the notice ....
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....er (Appeals) is factually incorrect. The dispute regarding non-service of notice beyond the prescribed period was raised before the Assessing Officer for which the assessee is in possession of valid acknowledgement having raised an objection by letter dated 14-11-2002. The same is at page 88 of the Paper Book filed by the assessee. The Assessing Officer has not dealt with the objection raised. When the notice dated 30-10-2002 was issued by registered post, the Commissioner (Appeals) has treated the post office as agent of the assessee, which is legally incorrect. When the notice is dispatched by the Assessing Officer by registered post, the post office is the agent of the Assessing Officer and not that of the assessee. He accordingly pleaded that none of the notice having been served upon the assessee as per the required procedure of law. The assessment cannot be framed pursuant to such invalid notice and therefore be annulled. The counsel for the assessee relied upon the following decisions in support of his contention:-- (a) Case Enterprises Ltd. v. Asstt. CIT [2006] 154 Taxman 204 (Delhi-Trib.); (b) Capital Gem Overseas (P.) Ltd. v. ITO [2006] 101 ITD 117 (Delhi); (c) Ess Aar....
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....tice dated 29-10-2002, it is seen that for the first time, the notice server tried to serve the same upon the assessee only after the offices were closed on 31-10-2002. It is to be noted that 29/30-10-2002 being Tuesday and Wednesday were working days. Similarly 31-10-2002 being Thursday is also a working day. It is not demonstrated as to whether the notice server approached the premises of the assessee before evening of 31-10-2002. It is also noted that no entry of notice server or even Inspector is recorded in the visitor's register kept at the gate of premises of the assessee. The Assessing Officer has ordered the service by affixture for the reason that the assessee is deliberately avoiding service of notice. We are unable to accept such contention. When the notice was tried to be served only after the office hours on the last day of the limitation period and in absence of any earlier attempt having been made by the revenue authorities to serve the notice, it cannot be said that the assessee is deliberately avoiding service of notice particularly when notice was never effected to have been served. If the revenue authorities try to serve the notice at the last hour after the clo....
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....ice by affixture as under : "Where the defendant or his agent or such other person as aforesaid refused to sign the acknowledgement, or where the serving officer, after using all due and reasonable diligence, cannot find the defendant, who is absent from his residence at the time when service is sought to be effected on him at his residence within a reasonable time, and there is no agent empowered to accept service of the summons on his behalf, nor any other person on whom service can be made, the serving officer shall affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily resides or carries on business or personally works for gain, and shall then return the original to the Court from which it was issued, with a report endorsed thereon or annexed thereto stating that he has so affixed the copy, the circumstances under which he did so, and the name and address of the person (if any) by whom the house was identified and in whose presence the copy was affixed." Rule 19 provides that-- "where a summon is returned under rule 17, the Court shall, if the return under that rule has not been verified by the affidavit of....
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.... 88 ITR 374 wherein it has been held the mere fact that the Assessing Officer did not find the assessee at the address, is not sufficient to establish that he could not be found. The Assessing Officer must show that he made reasonable efforts to find the person on whom the service was to be effected. It is only when such person could not be found after due efforts, the notice by affixture could be effected. The Hon'ble Allahabad High Court in the case of Shri Kishan Chander v. State of UP [1972] 29 STC 635, held that the mode of service by affixation could be resorted to only if none of the other modes was attributable and cannot be resorted to that too at the first instance. In the present case the very first notice is stated to have been served by affixture which is not valid as it cannot be said that the assessee was avoiding service of notice or there any other reason existed whereby it can be inferred that the notice cannot be served in an ordinary way. The Hon'ble Kerala High Court in the case of A.A. Kochandi v. Agriculture ITO [1977] 110 ITR 406 held as under:-- "Where service of notice on the assessee or his authorized agent or an adult member of his family is not possi....