TaxTMI 
TaxTMI 
2013 (8) TMI 560
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....the Ld. Income-tax Officer, Ward-1, Sirsa is bad in law and required to be quashed since it is without jurisdiction. 2) That the Ld. Income-tax Officer, in view of the facts and circumstances of the case has erred in law in framing the assessment U/s143(3). The facts of the case warranted the assessment, to be completed U/s 144 and not U/s 143(3). 3) That the allegation of the Assessing Officer that the Assessee has been avoiding the service of notice & non-cooperating in completing the assessment is totally against the facts. Rather the Ld. Assessing Officer failed to supply even the copy of the alleged uchanti papers/books on the basis of which he proceeded with to complete the assessment. 22) That without prejudice to our arguments vide Ground No. 4 to 21 the Ld. Income-tax Officer has erred in law as well as in fact in making the separate addition for each figure of alleged uchanti loose paper and books. Rather he should have calculated peak investment/credit based on those loose papers/books. ....
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....ring afresh. The present appeal is consequently fixed for hearing. The learned A.R. for the assessee at the outset pointed out that ground No. I raised in the present appeal is general in nature. Thus, ground No. I is dismissed. 5. The next plea of the learned A.R. for the assessee that ground No.II(1) against the jurisdiction of the Assessing Officer in passing the order is not pressed in view of the issue being decided by the Hon'ble Supreme Court in assessee's own case. Thus ground No.II(1) is also dismissed. 6. The issue in ground No.II(2) is that the assessee is aggrieved by the order being passed under section 143(3) of the Act and not being completed under section 144 of the Act. The learned A.R. for the assessee pointed out that once show cause notice issued by the Assessing Officer was non complied with, then the assessment being completed ex-parte, should have been completed under section 144 of the Act. 7. The learned D.R. for the Revenue referred to the observations of the CIT (Appeals) in para 3.2 and pointed out that the assessee failed to file complete information before the Assessing Officer despite several opportunities and thereafter the CIT (Appeals) also allo....
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....bsp; "...It is abundantly clear that the assessee is in no mood to co-operative with the department and the reasons for the same are not far to seek. With the impounding of parallel set of account books (copies duly signed by the assessee) by the deptt. And then issuing of detailed notices pointing out various discrepancies requiring clarification and evidence on various issues, being unable to file any satisfactory reply, the assessee has chosen this way of non-co-operation with the deptt. The photo copies of the requisite documents had already been given to the assessee and original of the parallel (uchanti) set of accounts is also with him which despite requiring to produce the same have never been produced before the deptt. Even when the assessee is available at Sirsa, he refuses to accept the notices. Refusal tent-amounts to good and valid service in the eyes of law. However, there was no compliance on the dates fixed. All the above facts lead to an irresistible conclusion that the assessee is avoiding the finalization of assessment proceedings for the simple reason that he has got no explanation what-so-ever to the transactions recorded in the documents No.D-1 to D-4 referred....
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....e case was fixed for hearing on 10.3.1998. However, the assessee failed to appear on any of the dates and no communication whatsoever was received from the assessee. Despite non-cooperative attitude of the assessee, another opportunity was allowed to the assessee and notices under section 142(1)/143(2 of the Act were issued to the assessee on 11.3.1998, which were sent by registered post to Sirsa address of the assessee. The assessee was also show caused that in case he did not attend the office on said date the assessment would be completed. On the appointed date of hearing i.e. 23.3.1998 none attended the office of the Assessing Officer, however, a letter was received from the assessee by registered post which is reproduced at page 4 of the assessment order. In the said letter the assessee admitted that it had received letter dated 6.8.1998 which was duly replied to by him and thereafter two more letters were received late i.e. after the date fixed in those letters. The assessee further claimed that in order to comply to the said letters he did come to the office of the Assessing Officer, who was not available in the office on the said date/s. 13. The second grievance of the ass....
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....he departmental Officers conducting the survey. Photocopies of these documents were obtained from the appellant and on comparison with the regular books of account, it was found that the appellant had been making investments, advancing loans and incurring the expenses etc. which were not found recorded in the regular books. The assessee had furnished return of loss declaring net loss of Rs.15,700/- against which assessment was completed under section 143(3) of the Act at Rs.43,16,730/-. The CIT (Appeals) noted various opportunities being given by the Assessing Officer and non-cooperative attitude of the assessee in not furnishing explanation regarding the entries in the incriminating documents in the second set of books of account found during the course of survey, except the attempts of the assessee to get his case to be transferred to Delhi on one pretext or the other. The CIT (Appeals) also noted that in the set aside proceedings, the Assessing Officer for framing fresh assessment had allowed various opportunities to the assessee. However, despite repeated opportunities, the assessee failed to furnish complete information before the Assessing Officer. The CIT (Appeals) summarize....
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....th the Assessing Officer and the CIT (Appeals) alleging that the Assessing Officer had failed to supply the copies of the papers/documents to the assessee and also completed the assessment under section 143(3) of the Act as against under section 144 of the Act. 17. In the totality of the facts and circumstances as noted by us in the paras hereinabove, it is purely a case where the assessee had tried to find one excuse or the other for not complying with the notices/show cause notice/explanation sought by the authorities below. The plea of the assessee that the assessment was completed without confronting him with the documents or without supplying him the copies of the documents relied upon are ill-founded. This is the case of Survey, where the documents found from the possession of the assessee were only identified by putting marks on the said documents and copies of the same were taken by the survey team and original were available with the assessee. Despite show cause notices issued to him, there was no compliance and originals of the said identified documents/books were not produced before the Assessing Officer in the original and set aside proceedings. The plea of the assesse....
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....; (b) the tax and interest, if any, shall be computed on the basis of the total income computed under clause (a); (c) the sum payable by, or the amount of refund due to, the assessee shall be determined after adjustment of the tax and interest, if any, computed under clause (b) by any tax deducted at source, any tax collected at source, any advance tax paid, any relief allowable under an agreement under section 90 or section 90A, or any relief allowable under section 91, any rebate allowable under Part A of Chapter VIII, any tax paid on self-assessment and any amount paid otherwise by way of tax or interest; (d) an intimation shall be prepared or generated and sent to the assessee specifying the sum determined to be payable by, or the amount of refund due to, the assessee under clause (c); and (e) the amount of refund due to the assessee in pursuance of the determination under clause (c) shall be granted to the assessee: Provided that an intimation shall also be sent to the assessee in a case where the loss de....
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.... 142, the Assessing Officer shall,- (i) where he has reason to believe that any claim of loss, exemption, deduction, allowance or relief made in the return is inadmissible, serve on the assessee a notice specifying particulars of such claim of loss, exemption, deduction, allowance or relief and require him, on a date to be specified therein to produce, or cause to be produced, any evidence or particulars specified therein or on which the assessee may rely, in support of such claim: Provided that no notice under this clause shall be served on the assessee on or after the 1st day of June, 2003; (ii) notwithstanding anything contained in clause (i), if he considers it necessary or expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, serve on the assessee a notice requiring him, on a date to be specified therein, either to attend his office or to produce, or cause to be produced, any evidence on which the assessee may rely in support of the ret....
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....ss of such scientific research association, news agency, association or institution or fund or trust or university or other educational institution or any hospital or other medical institution, shall be made by the Assessing Officer, without giving effect to the provisions of section 10, unless- (i) the Assessing Officer has intimated the Central Government or the prescribed authority the contravention of the provisions of clause (21) or clause (22B) or clause (23A) or clause (23B) or sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub-clause (via) of clause (23C) of section 10, as the case may be, by such scientific research association, news agency, association or institution or fund or trust or university or other educational institution or any hospital or other medical institution, where in his view such contravention has taken place; and (ii) the approval granted to such scientific research association or other association or fund or trust or institution or university or other educational institution or hospital or other medical institution has been withdrawn or notifica....
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....ter taking into account all relevant material which the Assessing Officer has gathered, shall, after giving the assessee an opportunity of being heard, make the assessment of the total income or loss to the best of his judgment and determine the sum payable by the assessee on the basis of such assessment : Provided that such opportunity shall be given by the Assessing Officer by serving a notice calling upon the assessee to show cause, on a date and time to be specified in the notice, why the assessment should not be completed to the best of his judgment : Provided further that it shall not be necessary to give such opportunity in a case where a notice under sub-section (1) of section 142 has been issued prior to the making of an assessment under this section. (2) The provisions of this section as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1987 (4 of 1988), shall apply to and in relation to any assessment for the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year and references in this section to the other provisions of this ....
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....e to appear on a specified date and time and also to specify in the show cause notice as to why the assessment should not be completed to the best of the judgment of the Assessing Officer. It is further provided under the section that where notice under section 142(1) of the Act had been issued prior to making of assessment then no such opportunity is to be given i.e. show causing the assessee as to why assessment should not be completed to the best of the judgment. The circumstances in which best assessment judgment could be completed are as under: (a) Where the person fails to make the return required under section 139(1) of the Act or has not made a return or a revised return under section 139(4) or section 139(5) of the Act; (b) Where the person fails to comply with all the terms of a notice issued under section 142(1) or the directions issued under section 142(2A) of the Act; (c) Where the person after filing the return of income, fails to comply with all the terms of a notice issued under section 143(2) of the Act. 23. The reading of the above said sections 143 and 144 of the Act reflects the manne....
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....oss in the hands of the assessee, to the best of his judgment. No such show cause notice as to completion of the assessment as best judgment of the Assessing Officer, is to be given by the Assessing Officer where notice under section 142(1) of the Act has been issued to the assessee, as provided by the 2nd proviso under section 144 of the Act. 25. The grievance of the assessee before us is that when there was non-compliance by the assessee before the Assessing Officer, the assessment in the case should have been completed under section 144 of the Act and not under section 143(3) of the Act and error has crept in the order of the Assessing Officer. In the first instance the assessment completed by the Assessing Officer cannot be invalidated on the surmises that in the present facts and circumstances of the case, the assessment should have been completed by the Assessing Officer by passing an order under the provisions of section 144 of the Act and not under section 143(3) of the Act. Recourse is made to the provisions of section 292B of the Act wherein it has been clearly provided that no return of income, assessment, notice, summons or other proceedings furnished to be made or iss....
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....various notices of hearing were issued to the assessee. The assessee in the original round of proceedings failed to take the notice on some plea or the other and his constant endeavor was that issue of change in jurisdiction was first decided. The assessee vide his reply dated 10.3.1995 acknowledged that he had received the notice/s but as he had shifted his business to Delhi, there was non-compliance He also made a request to the Assessing Officer that the copies of all the documents should be supplied to him. The photo copies of the requisite documents were given to the assessee and original of the parallel set of accounts was also with the assessee, which were never produced before the Assessing Officer and even various notices issued to the assessee were being refused by the assessee and assessment was completed after considering the various entries in the said parallel set of accounts and various documents found during the course of survey. 29. The CIT (Appeals) in the first round of proceedings vide order dated 10.10.1995 had set aside the assessment made by the Assessing Officer to be made again after providing adequate opportunity of hearing to the assessee to represent hi....
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....quest was made to make available copies of the documents. The contentions of the assessee were investigated by the Assessing Officer and it was found from the office record that there was no entry in the 'Peshi register' or any other evidence that the assessee had ever come to the office. In view of the above said facts and circumstances, the Assessing Officer was of the view that the assessee was using the strategy of avoiding to attend the office throughout the assessment proceedings and thereafter assessment was completed in the hands of the assessee. The Assessing Officer at pages 6 to 15 of the assessment order elaborately dealt with various aspects of the documents/books found during the course of survey and had tabulated the list of creditors as per Annexure-A, running into pages 1 to 15, which is annexed to the assessment order and computed the income of the assessee by making the total addition of Rs.53,32,425/-. The said assessment being completed in the hands of the assessee was pursuant to the directions of the CIT (Appeals) in the second round of assessment proceedings where certain information was collected by the Assessing Officer by way of survey and reconciliation ....
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....1. Another aspect which needs to be taken note is that while the proceedings in relation to issue of jurisdiction were pending before different Forums/Courts, another assessment order was passed under section 143(3) of the Act on 23.2.2004 which is annexed at pages 22 to 41 of the Paper Book and the assessment in the hands of the assessee was completed under section 143(3) of the Act again making an addition of Rs.53,32,425/- on the basis of the documents/books found during the course of survey. The assessee filed an appeal before the CIT (Appeals) and the appeal of the assessee was held to be infructuous as the present assessment was made in pursuance to the provisions setting aside the order of the Tribunal back to the file of the Tribunal. 32. Now coming to the issue raised on the merits of the addition, the learned A.R. for the assessee failed to put forward any contention in support of the merits of the case. As referred to by us in the paras hereinabove, the aforesaid addition of Rs.53,32,425/- has been made in the hands of the assessee on account of various entries in the parallel set of accounts and documents marked as D-1 to D-4 found during the course of survey. The asse....