TaxTMI 
TaxTMI 
2021 (11) TMI 915
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....e mandatory jurisdictional condition set out in section 147 of the Income Tax Act. 1961. Ground no. 2 :- On facts and circumstances of the case and in law, the learned Commissioner (appeals) erred in not quashing the reassessment proceedings as illegal and void as the same were without issuing mandatory notice U/S 143 (2) of the Income Tax Act. 1961. Ground no. 3 :- On facts and circumstances of the case and in law, the learned Commissioner al erred in sustaining the disallowance made by the learned Assessing Officer of Appellant's for house rent allowance U/S 10 (13A) of the Income Tax Act, 1961 of Rs. 3,40,000/- from his - salary income. Ground no. 4 :- On facts and circumstances of the case and in law, the learned Commissioner (appeals) erred in sustaining the disallowance made by the learned Assessing Officer of loss claimed by e Appellant under the head 'short term capital gains' of Rs. 53,37,250/- from sale of shares. Ground no. 5 :- On facts and circumstances of the case and in law, the learned Commissioner Appeals) erred in sustaining to the extent of Rs. 4,05,223/- the addition made by the learned Assessing Officer U/S 69 of ....
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....f Income u/s. 139 for the assessment year 2009-10 is 49-B Chandra Nagar, A.B Road Indore-452008 where his family resides. The return was filed on 18.09.2009. The notice u/s 148 was sent at "7-B Chandra Nagar". This was the address in which assessee used to reside before 2003 for a very brief period of time. The notice u/s 148 was actually delivered to "49-B Chandra Nagar" and signed by the father of assessee since this was within 200 meters radius and in same compound. Further, the Reasons recorded by the Assessing Officer u/s 148 dated 25.03.2015 addressed to 7-B Chandra Nagar also state that "Mr Sanjeev Patni is residing in E1102, Matri Elegance, Bannerghatta Road, Bangalore" and his principal place of employment is at Bangalore only. In reply to the notice u/s 148, it was stated that Income tax return already filed for A.Y. 2009-10 may be considered as in response to compliance u/s 148, thereby, reconfirming the address also. Copy of reason reads as under: "In continuation of proceedings, further the notice u/s. 142(1) for producing the books of account and other related documents registers, vouchers etc. in justification of income for the year under consideration i.e. ....
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....ubmitted that at the note of inspector, nowhere the details of Inspector or witness, their names, address, father's name or any other identification is placed. It is a settled proposition of law that service by affixture is a permissible mode of service, but a detailed procedure as given under Rule 17 & 19 of the Order V of 1908 of Code of Civil Procedure is applicable which indicate that notice by affixture can be resorted only as a last resort, after exhausting all other modes of service. Notice by affixture can be resorted only if Defendant refuses to sign the acknowledgement, or where the serving officer, after using all due and reasonable diligence, cannot find the defendant, who is absent from his residence at the time when service is sought to be effected on him at his residence and there is no likelihood of his being found at the residence within a reasonable time and there is no agent empowered to accept service of the summons on his behalf, nor any other person on whom service can be made. Further, it is the responsibility of the serving officer to affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily r....
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....ssment order, there is no mention of any notice u/s. 143(2) being issued to assessee. After referring to the return filed u/s. 148 and mentioning that the copy of reasons were provided, it was stated that the notice u/s. 142(1) for producing the books of account and other related documents registers, vouchers etc. in justification of income for the year under consideration i.e. A.Y. 2009-10 disclosed in the return filed in compliance of notice u/s. 148, fixing date of compliance on 29/06/2015 was issued on 25/06/2015 by speed post which was received back on 26/06/2015 with the remarks as "not available on the given address". From the perusal of note sheet, we find that that no mention is made of any notice issued in the year 2015 particularly of notice u/s. 143(2). Further, in the Remand Report, it was stated that the notice u/s. 143(2) was issued dated 25.06.2015 and was returned unserved. But, in the Assessment Order, the Assessing Officer stated that only notice u/s. 142(1) was issued on 25.06.2015 whereas in the Remand Report, he stateed that in the same envelope, notice u/s. 143(2) was also there. Such notice u/s. 143(2) was never brought on record. Further, in the remand repo....
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....has not been verified by the affidavit of the serving officer, and may, if it has been so verified, examine the serving officer on oath, or cause him to be so examined by another Court, touching his proceedings, and may make such further enquiry in the matter as it thinks fit; and shall either declare that the summons has been duly served or order such service as it thinks fit." 7. From perusal of the above, it is clear that notice by affixture can be resorted only as a last resort, after exhausting all other modes of service. Notice by affixture can be resorted only if: 1.(a) Defendant refuses to sign the acknowledgement, or 2.(b) where the serving officer, after using all due and reasonable diligence, cannot find the defendant, who is absent from his residence at the time when service is sought to be effected on him at his residence and there is no likelihood of his being found at the residence within a reasonable time and there is no agent empowered to accept service of the summons on his behalf, nor any other person on whom service can be made. 3. It is the responsibility of the serving officer to: (i) affix a copy of the summons on ....
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....compliance of the procedure laid down therein has to be made. The expression 'after using all due and reasonable diligence' appearing in rule 17 has been considered in many cases and it has been held that unless a real and substantial effort has been made to find the defendant after proper enquiries, the Serving Officer cannot be deemed to have exercised 'due and reasonable diligence'. Before taking advantage of rule 17, he must make diligent search for the person to be served. Another requirement of rule 17 is that the Serving Officer should state that he has affixed the copy of summons as per this rule; the circumstances under which he did so; the name and address of the person by whom the house or premises were identified; in whose premises the copy of the summon was affixed and these facts should also be verified by an affidavit of the Serving Officer. This view is supported by the ratio laid down in case of World Wide Exports (P.) Ltd. [2004] 91 ITD 519 (DEL). We find that the facts related to affixture of notice cannot be true in light of the affidavit from Shri Rajiv Patni (brother of assessee) which states as under: a. They reside in 49B Chandra Nagar, A.B Road Ind....
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.... that he personally knew the place of business of the assessee. Hence, the service of notice must be held to be not in accordance with the law. The possibility of his having gone to a wrong place could not be ruled out. Hence, it was not possible to hold that the assessees had been given a proper opportunity to put forward their case as required by section 33B." In the present case also, the serving officer could not state in his report the any name and address of the witnesses who have identified the house of the assessee and in whose presence the notice was affixed. Further, the affidavit in assessment records is missing thus in contravention of Rule 20 of Order V of CPC 1908. We find that in case of Jagannath Prasad [1977] 110 ITR 27 (ALL.), the Hon'ble Allahabad High Court held as under: "the report given by the process server was to the effect that he had made enquiries at a number of places but could not find out the assessee. After this report the ITO passed an order for affixture. From the mere fact that the process server could not find out the assessee it would not lead to the conclusion that the assessee was keeping out of the way for the purpose of avoiding ....
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....erms of proviso to Section 143(2) but the same has not been served in terms of the procedure laid down by the provision under section 282 of the Act. In that view of the matter, it was ultimately contended by the Ld. AR that the impugned order is bad in law and is liable to be quashed. 2. On the contrary Ld. DR contended that the notice dated 03.09.2009 u/s 143(3) of the Act was duly discharged through speed post followed by another notice by the notice servers namely Shri Prem N. Joshi on 4.9.2009. The proof of the two services are on record before the revenue and duly submitted before the Ld. Tribunal and therefore, according to the Ld. DR it has been assumed that the notice served was entered in the scrutiny pendency register. Hence, the plea of the order being passed without due process of law is not tenable. 3. We have heard the rival submissions made by the respective parties on the ground of maintainability of the assessment proceedings. We have also perused the available records. The case of the assessee is this that the notice u/s 143(2) and 142(1) of the Act was received for the first time in 21.7.2010 by and under the notice dated 14.07.2010 fixing the ....
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....ice of the concerned Revenue Officer and this could be kept in the file. Secondly the notice which has been claimed to have been served upon the assessee through office server the acknowledgement whereof speak about the details of the person receiving the same. In fact the notice server Shri Prem N Joshi failed to prove on record the Name/designation/identification of the person to whom the same was delivered. It was contended by the appellant that the signature of the impugned notice does not belong to any of the officer/Director or employee of the company. It is relevant to note that this fact has not been controverted by the revenue. No such evidence indicating receiving notice genuinely on behalf of the assessee is forthcoming from the revenue in order to substantiate that the service has actually been affected. The Ld. DR has not been able to satisfy us on this aspect. In that event we do not hesitate to conclude that the provision of service of notice as stipulated under Section 282 of the Act as if it is a summon issued by a court under the code of civil procedure, 1908 (5 of 1908) has not been complied with in its true spirit, in the absence of disclosure of identification ....