TaxTMI 
TaxTMI 
2011 (2) TMI 901
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....ecting the contention of the appellant that the reasons recorded for reopening are bad in law & as such the reassessment done in consequence to that needs to be quashed. 4. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in rejecting the contention of the appellant that the assessment order is bad in law & is liable to be quashed as the same has been made without first disposing of the objections raised by the appellant against the reopening. 5. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in upholding the reassessment framed under section 143 (3) despite the fact that no notice under section 143 (2) has been issued, a fact admitted by the A.O. in remand report. 6. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in confirming the addition of Rs.32,85,500/- on account of training & development expenses. 7. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in rejecting the contention of the appellant that no reliance can be placed on the state....
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....of training & development expenses. 7. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in rejecting the contention of the appellant that no reliance can be placed on the statement of Sh. S.K. Gupta recorded at the back of the assessee without providing cross examination. 8. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in rejecting the contention of the appellant that the A.O. has misinterpreted the statement of Sh. S.K. Gupta & has wrongly used the same against the assessee, as the appellant has not been named in the said statement & there is no allegation against it coming out of the said statement. 9. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in arbitrarily CIT (A) has erred both on facts and in law in arbitrarily rejecting the evidence submitted in support of the expenditure incurred despite the fact that even in the remand report A.O. has not pointed out any defect and has not given any adverse comment on that. 10. On the facts and circumstances of the case, the learned CIT (A) h....
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....d no notice under section 143 (3) was issued: The perusal of assessment records shows that the A.O. did provide opportunity to the assessee to place its claim in its defence. The statutory notice u/s 143 (2) could not be issued in this case." 5. Similarly, for assessment year 2006-07, he invited our attention towards the following observations of the Assessing Officer (copy of remand report is filed at pages 138 to 142 of the paper book):- "Ground No.1 : Assessment order is in bad in law and no notice under section 143 (3) was issued: The perusal of assessment records shows that the A.O. did provide opportunity to the assessee to place its claim in its defence. The statutory notice u/s 143 (2) could not be issued in this case." 6. Thus, it was pleaded by him that either the case of the assessee should be accepted on the submissions made by the Assessing Officer before the CIT (A) in the remand report or to determine this fact the matter may be restored back to the file of the CIT (A) as this issue will go to the root of the matter and if no notice has been issued or served on the assessee u/s 143 (2), then, the re-assessment order passed b....
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....ion and therefore no notice under that provision would be necessary. If the A.O. makes the assessment order in terms of the return of undisclosed income filed by the assessee without issuing a notice under s.143 (2) then he would not have committed any mistake. This is a situation where the s.143(2) notice would not be necessary at all." (emphasis ours) 9. The aforementioned view of Hon'ble jurisdictional High Court has now been confirmed by the Hon'ble Supreme Court in the case of ACIT vs. Hotel Blue Moon (supra) wherein their lordships have observed as under:- "15. We may now revert back to s.158BC(b) which is the material provision which requires our consideration. Sec.158BC (b) provides for enquiry and assessment. The said provision reads "that the A.O. shall proceed to determine the undisclosed income of the block period in the manner laid down in s.158BB and the provisions of s.142, sub-ss. (2) and (3) of s.143, s.144 and s.145 shall, so far as may be, apply." An analysis of this sub-section indicates that, after the return is filed, this clause enables the A.O. to complete the assessment by following the procedure like issue of notice under s.143(2)/142 a....
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....ved altogether, but, it was also necessary to serve notice on assessee u/s 143 (2) before completion of the re-assessment proceedings. That amendment was brought into the statute by virtue of proviso to Section 148 inserted by Finance Act, 2006 and such position of law has been explained by Hon'ble Madras High Court in the case of CIT vs. Mrs. C. Malathy (2007) 294 ITR 532 (Mad). 11. For an authority that for re-assessment proceedings also the requirement of issuing notice u/s 143 (2) within 12 months is mandatory, reference can be made to the decision of Hon'ble Madras High Court in the case of CIT vs. C. Palaniappan (2006) 284 ITR 257 (Mad) wherein it has been held that completion of re-assessment without issue of notice u/s 143 (2) within 12 months is invalid. From the above discussion of law, it is clear that even in respect of reassessment proceedings if the Assessing Officer, on receipt of return in response to notice u/s 148, requires further information or explanation, then, he has to serve notice u/s 143 (2) and issue of notice u/s 143 (2) is not necessary in a case where he accept the return as it has been filed by the assessee. 12. The facts of the pr....