TaxTMI 
TaxTMI 
2020 (1) TMI 1046
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....(3) on 30th June, 2013, determining the total income at Rs. 2,04,57,580/-. Subsequently, the case of the assessee was reopened u/s 147 of the IT Act, 1961 and notice u/s 148 was issued on 29th January, 2015. The basis for such reopening was that a survey was conducted in the case of the assessee u/s 133A on 22nd January, 2014 during which a diary was found from the cabin of Shri R.N. Aggarwal, DGM (Finance) which was impounded as Annexure A-11. The said diary contains details of receipt of cash against the payment made to various parties in the garb of commission/business procurement and under other heads. The diary also contained unaccounted sale of scrap and excess payment of interest over and above what has been recorded in the books of account. According to the Assessing Officer, the assessee did not file any reply in response to such notice issued u/s 148. He, thereafter, issued notice u/s 142(1) dated 29th February, 2016 fixing the case for hearing on 8th March, 2016. The AR of the assessee attended before the Assessing Officer on 8th March, 2016 and filed its reply wherein it was submitted that reply to the notice issued dated 09.01.2015 was submitted in the office of the th....
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....ection during the course of reassessment proceedings with regard to service of notice u/s 143(2) and complied to all the notices issued. In the case of the appellant notice was issued on 09.01.2015 while the objections were filed by the appellant only on 14.03.2016. The AO has duly disposed off the objection as per the decision of the Hon'ble Supreme Court in the case of GKN Driveshafts India Ltd. Vs ITO 259 ITR 19 vide letter dated 15.03.2016. After disposal of the objection, AO has issued the notice u/s 143(2) to the appellant. Even in the objections appellant has not raised the issue of non issuance of notice u/s 143(2) within time. The AO has followed the procedure laid down by the Hon'ble Supreme Court in GKN Driveshafts, thus objection raised by the appellant for not issuance notice within time is not acceptable. The appellant is also not entitled to raise objection as per the provisions of section 292BB, as notice u/s 143(2) of the Act was duly served upon it and appellant has appeared and cooperated during the assessment proceedings. 6.4 Considering the above facts, AO has correctly initiated the reassessment proceedings in the case of the....
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....nd circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in making addition of Rs. 6,77,918/- on account of interest paid on unsecured loan and that too by recording incorrect facts and findings and in violation of principles of natural justice. 7. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in passing the impugned reassessment order and various disallowances made therein are illegal, bad in law, contrary to law and facts, void ab-initio and not sustainable on various legal and factual grounds. 8. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in not reversing the action of Ld. AO in charging interest u/s 234B and 234C of Income Tax Act, 1961. 9. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other." 6. The ld. counsel for the assessee strongly challenged the order of the CIT(A). In his preliminary objection regarding non-issuance of notice u/s 143(2), the ld.....
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....ssessee. Referring to the reply obtained from the Revenue under RTI Act, he submitted that it was mentioned by the Assessing Officer that the letter dated 23rd October, 2015 filed by the assessee for assessment year 2010-11 is not available on the records maintained in this office. He submitted that when the letter for assessment year 2010-11 was available in the office of the Department, it cannot be said that the letter for the assessment year 2011-12 is not available on the record. To strengthen his argument, the ld. counsel submitted that neither the assessment has been completed u/s 144 nor the Assessing Officer has levied interest u/s 234A which shows that the assessee had, in fact, filed the letter in response to notice u/s 148. Therefore, in absence of issuance of any notice u/s 143(2), the assessment has to be quashed in view of the decision of the Tribunal in assessee's own case for the immediately preceding assessment year. Referring to the following decisions, he submitted that in terms of section 27 of the General Clauses Act, if a notice is properly addressed and dispatched through registered post, there is a presumption that it has been served on the assessee:- ....
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....sel, referring to the following decisions, submitted that the courts have held that non-issuance of notice u/s 143(2) is not a mere irregularity, but, is an illegality which cannot be cured:- i) Pr. CIT vs. Oberoi Hotels (P) Ltd. (2018) 96 taxmann.com 104 (Cal); ii) ACIT vs. Hotel Blue Moon (2010) 321 ITR 362 (SC); iii) ACIT vs. Ashed Properties & Investments (P) ltd. (2015) 62 taxmann.com 340 (Bangalore-Trib); iv) Travancore Diagnostic (P) Ltd. vs. ACIT (2017) 390 ITR 167 (Ker.); & v) ITO vs. Aligarh Auto Centre (2013) 34 taxmann.com 211 (Agra-Trib) 11. He accordingly submitted that the order passed by the Assessing Officer has to be held as void ab initio and has to be quashed since no notice u/s 143(2) was issued within the stipulated period of time. 12. So far as the merit of the case is concerned, the ld. counsel for the assessee, referring to various pages of the paper book, submitted that there is no incriminating documents found during the course of survey. Whatever commission has been paid by the assessee has been debited in the P&L Account and the assessee has not given anything extra. So far as the sale of scrap....
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....siness procurement expenses, scrap sales, interest paid on borrowals was rightly upheld by the CIT(A). 14. The ld. counsel for the assessee in his rejoinder, referring to the decision of the Hon'ble Delhi High Court in the case of PCIT vs. Jai Shiv Shankar Traders Pvt. Ltd. (2016) 383 ITR 448 (Del), submitted that the Hon'ble High Court in the said decision has held that failure of the Assessing Officer to issue notice u/s 143(2) in reassessment proceedings, prior to finalizing the reassessment order, cannot be condoned by referring to section 292BB and is fatal to the order of reassessment. He submitted that in the said decision, it has been clearly brought out that the decision of the Hon'ble High Court in the case of Madhya Bharat Energy Ltd., (supra) has been recalled, therefore, the decision relied on by the ld. DR is of no use. So far as the decision reported in the case of CIT vs. Vins Overseas India Ltd. (supra) is concerned, he submitted that the Hon'ble High Court in the said decision has held that in terms of section 27 of the General Clauses Act, 1897, if a notice is properly addressed and dispatched through registered post, there is a presumption tha....
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....h notice, the assessee, vide letter dated 23rd March, 2015, filed a reply stating that the return filed by them for assessment year 2011-12 on 29th September, 2011 may kindly be treated as the return filed in response to such notice dated 9th January, 2015. In support that this letter was sent by speed post, the assessee has enclosed the postal receipt bearing No.EH60011746IN dated 23rd March, 2015, copy of which has been placed at page 41 of the paper book. It is the case of the assessee that since the assessee has filed a letter stating that the original return filed should be treated as the return filed in response to notice u/s 148, therefore, the Assessing Officer was duty bound to issue notice u/s 143(2) and since the said notice was never issued by the Assessing Officer, therefore, the assessment order is bad in law and has to be quashed. However, we find the ld.CIT(A) did not accept the contention of the assessee and dismissed the ground raised on this issue the reasons for which have already been reproduced in the preceding paragraphs. It is the submission of the ld. counsel for the assessee that when the notice u/s 148 was issued by the same Assessing Officer for both the....
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....available on the record maintained in the office of the Department. In our opinion, the assessee cannot be penalized for the mistake on the part of the Department or the Assessing Officer. 17.1 We find the Assessing Officer in the case of the assessee for A.Y. 2010-11 at para 2 of the assessment order has observed as under:- "2. The assessee filed letter date 14.03.2016 wherein in objected against the re-assessment proceedings u/s 147 for A.Y. 2010-11. The above objection of the assessee was considered but not found to be acceptable. Further, the undersigned vide order dated 15.03.2016 passed a speaking order disposing objections to the notice u/s 148 of the Act for A.Y. 2010-11 and proceeded with the reassessment proceedings by issuing notice u/s 143(2) dated 15.03.2016." 18. We find, under identical circumstances, the Tribunal in assessee's own case in the immediately preceding assessment year, has held the assessment order to be bad in law on account of non-issuance of notice u/s 143(2) of the IT Act, 1961 within the stipulated time prescribed under the Act. The relevant observations of the Tribunal at para 5 read as under:- "5. Heard the arguments of bot....