TaxTMI 
TaxTMI 
2012 (3) TMI 472
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....as ORDER PER ASHA VIJAYARAGHAVAN, JM . This appeal preferred by the assessee is directed against the order passed by the ITO, Ward 1(2)-Hyderabad dated 14.10.2010 and the SA filed by the assessee pertains to the assessment year 2006-07. The assessee filed the Stay petition in SA.5/H/2012 on 12.1.2012 for the 3rd time, earlier SA No.3/2011 & SA.79/2011 were filed and heard by the Tribunal. The assessee's appeal in ITA No.1430/H/2011 was posted for hearing on 16.1.2012 and adjourned to 30.1.2012. It was pointed out by the learned counsel that the stay will expire on 20.1.2012. The Tribunal has directed the Stay matter to be put up for hearing with the appeal posted on 30.1.2012. Since we are passing the order and disposing off the appeal, in ITA No.1430/H/2010 the Stay petition filed by the assessee in SA.5/H/2012 will become infructuous. 2. The assessee raised the following grounds in its appeal: as under: 1. That the assessment order passed in pursuance to the directions issued by the Learned DRP is a vitiated order as the learned DRP erred both on facts and in law in confirming the addition made by the learned AO to the assessee's income by issuing a non speaking or....
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....O as stated in grounds 5.1 to 5.8. 7. That the AO has grossly erred in allowing the depreciation on computer peripherals at the rate of 15% which is the rate allowable for general plant and machinery. Instead of at the rate of 60% applicable to computers as per Rule 5 of the IT Rules, 1962 (the rules) r.w.s. 32(1) of the Act. 7.1. The AO further erred on facts in equating computer accessories and peripherals which are integral parts of computer with machines like MRI scanning machine, measuring machines used in the wielding industry. 7.2. The AO has on the facts and in the circumstances of the case and in law, erred in holding that the computer peripherals/accessories are not part of the computers. 7.3. The Ld. AO has erred in not serving a valid notice u/s 143(2) of the Act within the time prescribed under the Act and hence the assessment proceedings are bad in law and void ab initio. 8. That the AO has erred both on facts and in law in levying interest u/s 234B of the Act amounting to Rs. 13,868,575/- 9. That the CIT(A) has erred both on facts and in law in confirming the interest levied by the AO under section 234C of the Act amounting to Rs. 530.82/- 3. The....
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.... served, as the next notice under Section 142(1) dated 10-10-2008 has been received only on 21-10-2008 as is evident from the assessment file perused by the Hon'ble Bench. Onus of the appellant was proved when the appellant raised objection vide letter dated 05-11-2008 that the notice was NOT SERVED on the appellant. However, no action was taken by the ld AO to prove otherwise, nor has any evidence been submitted until the last hearing before the Hon'ble Bench on 30-01-2012. 6. The learned counsel Kanchun Kaushal also submitted that the order under Section 115WE(3) of the Act dated 22.12.2008 accepted the value of fringe benefits as returned by the appellant for the said assessment year in response to the notice under Section 115WE(3) dated 01-12- 2008 (not the notice dated 22.11.2007), and hence, it would not have any bearing on this proceedings, where the validity of notice has been challenged in the very initial stage itself. 7. The Department had submitted at Para 2.2 of its submission as follows: " Certified copy of the said notice was placed before the Hon'ble Bench for reference and record. At this point, the Hon'ble Bench directed production of the case records for....
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....document was picked up from the department on 22-11- 2007. What is the presumption of the evidence/ material to show that a notice handed over to the postal authorities on 22- 11-2007, as is being alleged by the department, was despatched between 23-11-2007 and 30-11-2007. It is this material/ evidence of despatch between 23-11-2007 and 30-11-2007 that the Hon'ble Bench had directed the department to file. No such evidence was filed by the Department in the last date of hearing, i.e. 30.01.2012. Coupled with the fact that no fresh notice of hearing was issued by the ld AO after non-appearance on the alleged date of hearing, i.e. 29.11.2007, proves beyond doubt that the notice was never served." 12 The department at para 2.4 relied on the following two case laws: 1. CIT Vs. Madhsy Films (P) Ltd. (301 ITR 69) 2. Section 27 of the General Clauses Act, 1897 3. Chief CIT Vs. VK Gururaj and Others (SC) 4. Capital Gem Overseas (P) Ltd. Vs. ITO (2006) 101 ITD117 13 The assessee in his written submission summarised that in the present case the onus was on the department to prove that the notice was served, however, there was no proof of despatch filed by the department. Fu....
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..... CIT 60 DTR (P&H) 393. Reliance was also placed on the decision of the jurisdictional Bench of the Tribunal in the case of Navayuga Spatial Technologies P Ltd. Vs. DCIT (in ITA No.1557/H/2010). 20. Further the department relied on the CBDT Circular 1 of 2009 dated 27.3.2009 to the effect that section 292BB of the Act applies to all proceedings pending as on 1.4.2008 without prejudice to both the arguments of the department Viz., reliance was placed : 1. on OM Sons International Vs. CIT 2. The Circular 1 of 2009 dated 27.3.2009, the department referred to the decision of the Kerala HC in the case of KG Thomas CIT 301 ITR 301 in its submissions. It had been held in the decision of KG Thomas (supra) that the procedure u/s 143(2) of the Act is to ensure that an adverse order is issued only after proper opportunity is given to the assessee. In this case, it is conceded was in fact filed and reassessment notice and final order were also issued within the time limit prescribed under the Act. 21. In the counter submission made by the assessee it was contended as follows: 1. Assuming but admitting that the provisions of section 292BB are applicable for assessment year 2006-0....