2012 (1) TMI 209

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....f requisite jurisdiction especially, the mandatory requirements to assume jurisdiction under section 148 of the Act did not exist and have not been complied with and consequently, the re-assessment requires to be cancelled. ii) Without prejudice to the above, the authorities below are not justified in completing the assessment proceedings under section 143(3) of the Act without issuing the mandatory notice under section 143(2) of the Act and consequently, the impugned order passed is a nullity and liable to be cancelled. iii) Without prejudice to the above, the authorities below are not justified in assessing a sum of ₹ 12,13,68,180/- as long term capital gains and a sum of ₹ 61,32,800/- as short term capital gains under secti....

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....eal before the first appellate authority. The assessee has challenged jurisdictional aspect, namely, the reopening of the assessment is invalid since no notice under section 143(2) of the Act was issued. The issue on merits was also challenged. Both the issues were decided against the assessee by the first appellate authority. 4.1 The jurisdictional aspect, namely, no notice under section 143(2) of the Act was issued before completion of assessment under section 147, was decided by the first appellate authority against the appellant by observing thus:- "I have considered the arguments and the written submission and the materials on record. I find that the appellant has participated in the assessment proceedings and has not raised this obj....

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.... 148(1) will not come to the rescue of the revenue, since in this case; no notice under section 143(2) has been issued. The learned AR relied on the order of the Tribunal in the case of ITO v R K Gupta 308 ITR (AT) 49 (Del.). 7. The learned DR on the other hand strongly supported the order of the first appellate authority. 8. We have heard the rival submissions and perused the material on record. In this case, return of income was filed on 19/9/2006 declaring a loss of ₹ 65,49,770/-. Subsequently, notice under section 148 was issued (dated 13/11/2007). In reply to the notice, the assessee had filed a letter dated 12/12/2007 wherein the assessee had stated that there is no escapement of income and requested for furnishing the reasons....

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....only from assessment year 2008-09. It was further held that the objection with regard to non-issuance of notice under section 143(2) can be raised before the appellate authorities prior to assessment year 2008-09. The relevant finding of the Special Bench is summarized as follows (Para 46) :- "Summarising our findings we hold as follows:- (i) Section 292BB even if it is procedural it is creating a new disability as it precludes the assessee from taking a plea which could be taken as a right, cannot be construed retrospectively as the same is made applicable by the statute with effect from April 1, 2008. (ii) Section 292BB is applicable to the assessment year 2008-09 and subsequent assessment years". 8.2 The Hon'ble Madras High Court in ....