AI Drafter - (New and Powerful) 
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter. 
TaxTMI 
TaxTMI 
2019 (7) TMI 941
X X X X Extracts X X X X
X X X X Extracts X X X X
....ent Year 2011-2012. The said notice dated 15.3.2018 was despatched for delivery through post. It was returned by the postal authority on 23.3.2018 with a remark "left". According to the Department, the address in the said postal communication was as stated by the assessee in her PAN which she never requested to be changed. On the basis of such notice and the postal despatch, the Assessing Officer carried on the assessment for the said Assessment Year. During the assessment, however, he attempted to serve notices on the petitioner at the address given by her in her bank account, the details of which were with the Department. 3. The Assessment Officer passed a reassessment order dated 28.12.2018. The Department thereafter issued a recovery notice dated 1.2.2019 seeking recovery of the petitioner's tax dues pursuant to the said assessment order. According to the Department, during the period relevant to the Assessment Year in question, the petitioner had entered into various high value transactions such as cash deposits in the bank account, purchase of mutual funds, sale and purchase of immovable properties, etc. 4. According to the petitioner, she was completely unaware and obl....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e issue of notice where income has escaped assessment. Sub-section (1) of section 148 provides that before making assessment or recomputation under section 147, the Assessing Officer shall serve on the assessee a notice requiring him to furnish the return of income in prescribed form. Section 149 of the Act pertains to time limit for such notice to be issued under section 148 of the Act. 8. In terms of section 148(1) of the Act, thus, before making reassessment under section 147, the Assessing Officer had to serve on the assessee the notice requiring him to furnish a return. Service of notice is necessary and not its mere issuance. In terms of provisions contained in section 149 of the Act, such notice could have been issued latest by 31.3.2018. As we have noted, the Department did issue such a notice on 15.3.2018 and despatched it through post for its service to the petitioner at the address given by her in the PAN card. This postal despatch, however, was returned by the postal department with a remark "left". The Assessing Officer proceeded on the basis of such notice and its return and completed the assessment after issuing notices under section 143(2) of the Act. The questio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Courts in the CIT v. Ramsukh Motilal and R.K. Das & Co. v. CIT and we think that that view is right." 10. In the case of Shanabhai B. Patel vs. R.K. Upadhyaya, Income Tax Officer, Ahmedabad reported in (1974) 96 ITR 141, the Division Bench of Gujarat High Court had examined similar issue and opined as under: 9. In our opinion, therefore, the assumption of jurisdiction by the Income-tax Officer of reassessing an assessee is subject to the provisions contained in section 148 to 153 of the Act. Section 148 and 149, which we have reproduced above, clearly show that such jurisdiction cannot be assumed without issuance of notice within the prescribed period and service thereof on the assessee concerned. Mr. Kaji, however, attempted to persuade us that the very fact that the legislature has divided these different provisions contained in the old section 34 of the 1922 Act by suitably enacting sections 147, 148 and 149, where the Income-tax Officer has been given power to reassess after service of notice on the assessee issued within the prescribed period, clearly indicates that the legislature intended to depart from the positions as it emerged from the provisions contained in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e stage of service of notice and ordinarily this decision being a decision of a Division Bench of this court would be binding upon us, but having regard to the subsequent decision of the Supreme Court in Banarasi Debi v. Income-tax Officer, this decision can no longer be regarded as good law and its authority must be held to have been impliedly overruled, though we may point out that even if the view taken by the Bombay High Court in this decision were correct, we should still have found considerable difficulty in accepting the contention that the proceedings under section 34 commence on the issue of the notice. The Supreme Court in the decision to which we have just referred pointed out that the words 'issued' and 'served' are used as interchangeable terms in the context of notice issued under section 34 and that where the legislature has used the word 'issued' in the context of such notices, that word is used in the same sense as the word 'served'. This decision of the Supreme Court made it clear that, so far as notices under section 34 are concerned, there are no two distinct and separate stages such as the stage of issue of notice and the stage o....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... provisions of section 34 of the Act of 1922. The division of the provisions contained in section 34 of the 1922 Act into sections 147, 148 and 149 in the Act of 1961 does not in any way indicate that the legislature intended to depart from or materially alter the position as it emerged from the provisions of section 34 of the old Act regarding notice of reassessment. The Supreme Court held in Banarsi Debi vs. Income-tax Officer (1), that the words, 'service of notice' or 'issuance of notice' in section 34 have no fixed connotation but are interchangeable. The same meaning should be given to the words 'issue of notice' in section 148 and 'service of notice' in section 149. "Under the Act of 1961 also there are no two distinct and separate stages of issue of notice and service of notice. Notice of reassessment is issued to the assessee when it is served on him. A notice of reassessment issued against the assessee before limitation but served on the assessee after limitation would be without jurisdiction, void and ineffective." (4) We are respectfully in agreement with the above observations. Similar view was taken by a learned single judge o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ord as provided in Chapter IV of the Information Technology Act, 2000 (21 of 2000); or (d) by any other means of transmission of documents as provided by rules made by the Board in this behalf. (2) The Board may make rules providing for the addresses (including the address for electronic mail or electronic mail message) to which the communication referred to in subsection (1) may be delivered or transmitted to the person therein named. Explanation. - For the purposes of this section, the expressions "electronic mail" and "electronic mail message" shall have the meanings as assigned to them in Explanation to section 66A of the Information Technology Act, 2000 (21 of 2000)." 14. As per the sub-section (1) of section 282 thus, the service of notice or summons, etc. may be made by delivering or transmitting a copy to the person named, inter alia as per clause (a) by post or by such courier service as may be approved by the Board or in such manner as provided under the Code of Civil Procedure for the purposes of service of summons. The Department has followed the procedure envisaged in clause (a) of sub-section (1) of section 282 of attempting to deliver th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ess for such transmission. First one being the address available in PAN database of the addressee. It was at this address that the notice in question was despatched. The first proviso to sub-rule (2) provides that the said communication shall not be delivered at any of the above mentioned addresses where the assessee has furnished any other address for such purpose, which is not in the present case. The further proviso to sub-rule (2) which is of considerable importance to us provides that where communication cannot be delivered or transmitted to the addresses mentioned in item Nos.(i) to (iv) or the address furnished by the assessee as per the first proviso, the communication shall be delivered or transmitted to the addresses given below the said further proviso. At item No.(i) is the address of the assessee as available with the Banking company or a cooperative bank to which Banking Regulations Act, 1949 applies. 17. Since the delivery of the notice could not be made at the address of the assessee available in PAN database, by virtue of the further proviso to sub-rule (2) of Rule 127, the communication had to be delivered at the address as available with the banking company. ....