2012 (7) TMI 758

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....u/s. 143(1) vide intimation dated 31.03.2006. The notice u/s. 148 dated 10.05.2006 was issued and served upon the assessee. The assessee in response to notice u/s. 148 of the IT Act submitted that the return already filed on 14.02.2006 may be treated as the return filed in response to the notice u/s. 148 of the IT Act. The AO, after giving opportunity of being heard, passed the re-assessment order u/s. 143(3)/147 of the IT Act on 26.09.2007. After making addition of Rs.10,78,482/- being the amount disallowed, the AO also made addition of Rs.2973/- on account of Mediclaim. The assessee challenged the reassessment proceedings before the ld. CIT(A) mainly on the ground that the re-assessment proceedings were invalid, as the time for issuance o....

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....issue of notice u/s. 143(2) of the Act, then the notice u/s. 148 cannot be issued during the pendency of proceedings. The notice u/s. 148 was issued on 10.05.2006. Therefore, initiation of proceedings by the AO by issuing notice u/s. 148 was not justifiable and as such was not a valid action in law. The ld. CIT(A) accordingly, quashed the proceedings. However, as regards the merit, the ld. CIT(A) restricted the addition of Rs.10,78,482/- to Rs.2,11,000/- and granted substantial relief to the assessee. 3. The Revenue preferred the above appeal originally challenging the order of the ld. CIT(A) only on merits in restricting the addition from Rs.10,78,482/- to Rs.2,11,000/- only. The Revenue did not challenge the quashing of the reassessmen....

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....tled law that unless the return of income already filed and disposed of, notice for reassessment u/s. 148 cannot be issued. i.e., no reassessment proceedings can be initiated so long as the assessment proceedings pending on the basis of the return already filed are not terminated. In this case, it is admitted fact that the AO could have issued notice u/s. 143(2) at the time of reopening of the assessment. Therefore, reassessment proceedings are invalid, as the time of issuance of notice u/s. 143(2) had not expired. The decision cited by the ld. Counsel for the assessee before the ld. CIT(A), as noted above, squarely apply to the case of the assessee and is also supported by the decision of Hon'ble Supreme Court in the case of Trustees of H.....