TaxTMI 
TaxTMI 
TaxTMI 
2022 (9) TMI 415
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....1 (briefly, 'the Act' hereinafter) assailing the order dated 12.07.2021 passed by the Income Tax Appellate Tribunal, Hyderabad 'B' Bench, Hyderabad (Tribunal), in ITA No.337/Hyderabad/2017 for the assessment year 2008-09. 3. The appeal has been preferred proposing the following as substantial questions of law: "1. Whether on the facts and in the circumstances of the case and in law, the ITAT is correct in applying the ratio of Apex Court in the case of ACIT v. Hotel Blue Moon ((2010) 321 ITR 362), when a valid notice u/s. 143(2) of the Act was issued and served within the prescribed limit? 2. Whether on the facts and in the circumstances of the case and in law, the ITAT is correct in holding that mentioning of "Section ....
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....007-08 and 1.14% for the assessment year 2006-07. Holding that respondent had failed to produce any evidence to substantiate its claim of loss, assessing officer rejected the book results and estimated the income of the respondent at 2.5% on the gross receipts of Rs.210,39,18,689.00 which worked out to Rs.5,25,97,967.00 whereafter tax and interest were levied. 5. This assessment order came to be challenged by the respondent before the first appellate authority i.e., Commissioner of Income Tax (Appeals) - 2, Hyderabad. First appellate authority by the appellate order dated 24.11.2016 held that assessing officer had dealt with the issue elaborately. Though opportunities were granted, respondent failed to produce any evidence in support of it....
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....e respondent's correct taxable income despite the return having been filed on 29.09.2008. Concurring with the view taken by the Supreme Court in Hotel Blue Moon's case (supra), Tribunal vide the order dated 12.07.2021 set aside the order of assessment on the ground that there was no valid notice under Section 143(2) of the Act. Relevant portion of the order of the Tribunal dated 12.07.2021 reads as under: "4. We have given our thoughtful consideration to rival pleadings against and in support of the correctness of the impugned assessment on account of Assessing Officer's alleged failure; as per the assessee's stand, in issuing section 143(2) notice "within a specified time factor of six months from the end of financial yea....
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.... 8. We have perused the notice at page No.32 of the paper book. As already noticed above, the return of income for the assessment year 2008-09 was filed on 29.09.2008. The notice is dated 17.09.2009 and it was issued under Sections 143(2) and 115WE(2) of the Act, the latter dealing with Fringe Benefit Tax. Section 143 of the Act deals with assessment. Sub-section (2) of Section 143 says that when a return is filed under Section 139 of the Act or in response to a notice under sub-section (1) of Section 142 of the Act, the assessing officer, if he considers it necessary to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, shall serve on the assessee a notice....
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....me tax referred to as fringe benefit tax in respect of the fringe benefits provided or deemed to have been provided by an employer to his employees during the previous year at the rate of thirty percent on the value of such fringe benefits. According to sub-section (2) thereof, even if no income tax is payable by an employer on his total income computed in accordance with the provisions of the Act, the tax on fringe benefits shall be payable by such employer. What are fringe benefits have been explained in Section 115WB of the Act. According to Section 115WD of the Act, without prejudice to the provisions contained in Section 139 of the Act, every employer who has paid or made provision for payment of fringe benefits to his employees during....
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....ment, but a mandatory provision. Though the above question was examined in the light of Section 158BC of the Act dealing with block assessment following search and seizure, nonetheless Supreme Court upheld the views expressed by the Gauhati High Court that Section 143(2) of the Act is mandatory and violation thereof cannot be construed to be a procedural irregularity. 14. Though Tribunal had followed the aforesaid decision which decision may not be strictly applicable to the facts of the case, nonetheless, we are of the view that the notice dated 17.09.2009 cannot be construed to be a notice under Section 143(2) of the Act for the purpose of assessment under Section 143 of the Act. It was a notice issued for the purpose of assessment on fr....