AI Drafter 
TaxTMI 
TaxTMI 
2021 (8) TMI 162
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....ued and served upon the assessee, that notice u/s 143(2) is enclosed along with that questionnaire, therefore, there was also issuance and service of the notice u/s 143(2) along with the questionnaire? (2) "On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in annulling the order passed u/s. 143(3) r.w.s. 147 of the I. T. Act after noting that the notice u/s 143(2) is not found on record inspite of the fact that there is mention in the questionnaire dated 28.08.2012, issued and served upon the assessee, that the notice u/s 143(2) is enclosed, which is duly noted in the order-sheet by AO on 28.08.2012?" (3) "On the facts and in the circumstances of the case and in law, the Ld. C1T(A) has erred in annulling the order passed u/s. 143(3) r.w.s. 147 of the I. T. Act after noting that the notice u/s 143(2) is not found on record inspite of the fact that there is mention in the questionnaire dated 28.08.2012, issued and served upon the assessee, that the notices u/s 143(2) and 142(1) are enclosed along with that questionnaire and notice u/s 142(1) is also found on record and same is responded by the assessee during the proceedings vide....
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.... Rs. 456,89,99,370. To adjudicate on the issues in this appeal, it is sufficient to note the facts at the assessment stage to this extent only. Aggrieved by the assessment so framed under section 143(3) r.w.s. 147, assessee carried the matter in appeal before the CIT(A). The assessee raised a grievance, though by way of an additional ground of appeal, that "the learned Assessing Officer erred in commencing and subsequently completing the reassessment proceedings, without issuing a notice under section 143(2) and the said proceedings are therefore bad in law and deserve to be quashed". Adjudicating on this grievance of the assessee, learned CIT(A) upheld the said plea and observed, inter alia, as follows: 6.3.1 I have considered the submissions of the appellant and perused the materials available on record. The appellant has requested to hold the impugned reassessment order u/s 143(3) rws 147 of the Act as bad in law and hence quash the same. The appellant has submitted that the Ld. AO has erred in commencing and subsequently completing the reassessment without issuing the mandatory notice u/s 143(2) of the Act. In support of it's said claim the appellant has relied on variou....
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....lly. Various courts/Tribunals have held that the reassessment completed u/s 143(3) rws 147 of the Act without issuing notice u/s 143(2) of the Act is bad in law and the said defect is not curable u/s.292BB of the Act. The Hon'ble ITAT Chandigarh in the case of Sanjeev Aggarwal, vs. DCIT while adjudicating similar issue, vide its order dated 25.05.2016 in ITA Nos. 102, 103, 169, & 170 (CHD) of 2016 has held as under. "We have heard the learned representatives of both the parties, perused the findings of the authorities below and considered the material available on record. From the order of the learned CIT (Appeals), we observe that there is no quarrel to the fact that in the present case notice under section 143(2) of the Act was not issued to the assessee. The fact of issuing notice under section 143(2) of the Act is also not coming out from the order of the Assessing Officer. This fact has not been controverted by the learned D.R. even before us. In view of this, since the learned CIT (Appeals) dismissed the ground of the assessee on the basis of provisions of section 292BB of the Act, the only issue remaining before us is to decide whether in the absence of issue of....
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....Act. 9. As regards the arguments of the learned D.R. that section 147 r.w.s. 148 of the Act, are a complete code in itself and there is no need for the Assessing Officer to go into other sections to assess or re-assess income under the said section. We would like to observe the substantive part of provisions of section 148, which reads as under ; "[Issue of notice where income has escaped assessment. 148 [(1)] Before making the assessment reassessment or recompilation under section 147, the Assessing Officer shall serve on the assessee a notice requiring him to furnish within such period, [* * *] as may be specified in the notice, a return of his income or the income of any other person in respect of which he is assessable under this Act during the previous year corresponding to the relevant assessment year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed; and the provisions of this Act shall so far as may be, apply accordingly as if such return were a return required to be furnished under section 139:]" 10. From the perusal of the above provisions, it is quite clear that ....
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.... re-assessment order, cannot be condoned by referring to Section 292BB of the Act. 19. The resultant position is that as far as the present case is concerned the failure by the AO to issue a notice to the Assessee under Section 143(2) of the Act subsequent to 16th December 2010 when the Assessee made a statement before the AO to the effect that the original return filed should be treated as a return pursuant to a notice under Section 148 of the Act, is fatal to the order of reassessment. 20. Consequently, there is no legal infirmity in the impugned order of the ITAT. No substantial question of law arises. The appeal is dismissed." 6.3.4 The legal position, as discussed above, that without issuing mandatory notice u/s 143(2) of the Act, the Assessing Officer cannot assume jurisdiction to compete reassessment u/s 143(3) rws 147 of the Act is no more re-integra as the Hon'ble Bombay High Court has settled the same. The Hon'ble Bombay High court in the case of ACIT vs. Geno Pharmaceuticals Ltd, reported in 32 taxmann.com 162 has held as under. "4. So far as Tax Appeals No.77/2012 and 78/2012 are concerned, in both these appeals, the ITAT has ....
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....pinion, it will not be possible to construe the provisions as are sought to be contended on behalf of the revenue. All the provisions of Chapter IV will have to be read in tandem so as to bring about an uniformity and certainty to an order of assessment. The proviso to section I6(2J Is in the nature of an embargo on the Assessing Officer, if the period has expired not to issue notice after that period.., In other words, the Assessing Officer is bound to accept the return as filed. Though the notice under section 16(2) may be procedural the proviso is not merely procedural but is in the nature of a limitation on the power of the Assessing Officer not to proceed further in a case where return has been filed under section 14 or under section 15. That will have to read as applicable to a case of reassessment under section 17. 14. Let us now examine sections 143 and 148 of the provisions of the income-tax Act, where similar language had been employed. Under section 143(2) (II), there is a limitation on the Assessing Officer not to issue notice if the period of twelve months had expired. Section 148 of the Income-tax Act had come up for consideration before several High Courts. ....
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....-tax Act. 16. Even Independently, we have examined the scope and effect of sections 14 to 16 on the one hand and section 17 on the other, in our opinion, there is no escape from arriving at the conclusion that when the Assessing Officer invokes section 17, the provisions of sections 14 and 16 to the extent applicable, for the purpose of making an order of reassessment will have to be followed which will include the time-limit for notice under section 16(2). Once the language of section 17 itself requires that other provisions to the extent applicable would apply considering the return as filed under section 14, it contemplates that both procedural and substantive provisions will apply. In our opinion, therefore, while invoking the powers under section 17, the Assessing Officer is bound by the mandate of the proviso to section 16(2) and on failure the order of reassessment will be without jurisdiction and consequently the order of reassessment will have to be set aside. 17. Having said so, we are clearly of the opinion that no error of law can be found with the view taken by the Tribunal. Consequently, the appeal is dismissed." 6.3.5 In view of the above d....
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....so raised with respect to inappropriateness of the admission of additional ground by the learned CIT(A) as the grievance regarding non-service of notice under section 143(2) was not a pure question of law but also a question requiring investigation of facts. Howsoever attractive these arguments may seem at the first sight, these arguments lack legally sustainable merits. A plain look at the proceeding sheet before the Assessing Officer shows that, according to the said proceeding sheet, the notice under section 143(2) and 142(1) is issued immediately upon issuance of notice under section 147 (sic- 148) on 29th March 2012, and the entry immediately following the entry of issuance notices is the entry dated 27th April 2012 which records filing of letter by the assessee to the effect that the income tax return filed by the assessee may be treated as return in response to notice- a fact corroborated by the facts set out in the assessment order as well. Quite clearly, therefore, there was no return, filed in response to notice under section 148, before the Assessing Officer at the point of time when notice under section 143(2) was issued. Such a notice thus can not be relevant for the r....