2014 (11) TMI 59

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....f the case, the Tribunal was right in permitting the issue relating to the service of notice for the first time before the Tribunal, which issue was not agitated before the Assessing Officer or the Commissioner of Income Tax (Appeals)? (ii) Whether on the facts and in the circumstances of the case, the Tribunal was right in not applying the provisions of Section 292BB of the Income Tax Act? 2.1. The facts in a nutshell are as under: The assessee filed return of income for the assessment year 2007-2008 admitting NIL income on 31.10.2007 and the same was processed under Section 143(1) of the Income Tax Act, 1961 (for brevity, "the Act"). The case was selected for scrutiny on the basis of Computer Assisted Scrutiny System and notice unde....

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....the assessment is liable to be annulled. Even though the Department pleaded that the notice under Section 143(2) of the Act was prepared on 18.9.2008, it was found that the department has not produced any record to show that the said notice was despatched and served on the assessee. The Tribunal, considering the fact that the department issued another notice under Section 143(2) of the Act only on 27.8.2009, beyond the time prescribed under Section 143(2) of the Act, held that such notice is invalid and the consequential assessment is bad. 2.5. Assailing the said order passed by the Tribunal, the present appeal is filed by the Department on the substantial questions of law, referred to supra. 3. We have heard Mr.T.Ravikumar, learned S....

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.... notice under clause (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. (emphasis supplied) 5. The word "shall" employed in Section 143(2) of the Act contemplates that the Assessing Officer should issue notice to the assessee so as to ensure that the assessee has not understated income or has not computed excessive loss or has not underpaid the tax in any manner. It is, therefore, clear that when the Assessing Officer considers it necessary and expedient to ensure that the tax is paid in accordance with law, he should call upon the assessee to produce evidence before him to ensure that the tax is paid in accordance with law. A reading of the said provision....