TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 410
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....pened and assessment u/s. 143 r.w.s 147 was completed by making an addition of Rs. 1,52,91,550/- u/s. 68 of the Act to the income of the assessee. 3. Against such order, an appeal was filed before the ld. CIT(A) who dismissed the appeal of the assessee. 4. Aggrieved by the said order of ld. CIT(A), assessee is in appeal before us and filed the following concise grounds of appeal: 1. "That the jurisdictional LD.AO has-erred, both in law and in facts, by assuming wrong jurisdiction in reopening the assessment, to issue notice under section 148, which is wholly without jurisdiction, thus reopening was bad in law and procedure, on all the parameters, laid down under the Act. 2. That the, Id. AO erred both in law and on the facts in not complying with the mandatory provisions of law & procedure laid down u/s. 147 to 153 and in violation of infringement of mandatory applicable binding CBDT instructions/circulars etc, in relation to both reopening u/s. 148 and reassessment, thus reassessment was bad in both law and procedure. 3. That the Id. AO erred both in law and on the facts in not supplying "Reason to believe" to the assessee, as per the mandate of Ap....
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.... 10. That the jurisdictional LD.AO has erred, both in law and in facts, without considering/appreciating the facts and circumstance of the case and in law the LD.AO was incorrect and unjustified in holding that the amount of Rs. 1,52,91,550/- deposited in the bank account by way of foreign currency was not explained, on account of foreign currency received on account of sale proceeds and also from the debtors and the LD.AO was incorrect and unjustified in treating the amount of Rs. 1,52,91,550/- as income on the basis of Borrowed satisfaction, doubt and suspicion and without bringing any material on record to prove that submission made by the assessee in respect of the amount was wrong or incorrect, thus assessment was bad in both law and procedure. 11. That the jurisdictional LD.AO has erred, both in law and in facts, without considering/appreciating the facts and circumstance of the case and in law the LD.AO was incorrect and unjustified in treating the amount of Rs. 1,52,91,550/- as income u/s. 68 even when all the three conditions necessary for satisfaction u/s. 68 has been satisfactorily explained, thus assessment was bad in both law and procedure. 12. Tha....
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....n the present case was illegal and void ab-initio on account of non-issuance of notice u/s. 143(2) thus, the re-assessment framed is at nullity and liable to be quashed. Ld. AR on this aspect, placed his reliance on the order of Hon'ble Supreme Court of India in the case of Asstt. CIT v. Hotel Blue Moon [2010] 188 Taxman 113/321 ITR 362 dated 02.02.2010, wherein while considering the same question of law raised by the revenue, Hon'ble Apex Court had held as under: 15. "We may now revert back to Section 158 BC(b) which is the material provision which requires our consideration. Section 158 BC(b) provides for enquiry and assessment. The said provision reads "that the assessing officer shall proceed to determine the undisclosed income of the Block period in the manner laid down in Section 158BB and the provisions of Section 142, subsection (2) and (3) of Section 143, Section 144 and Section 145 shall, so far as may be, apply." An analysis of this sub section indicates that, after the return is filed, this clause enables the assessing officer to complete the assessment by following the procedure like issue of notice under Sections 143(2)/142 and complete the assessment....
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....ere itself that the clarification given by CBDT in its circular No.717 dated 14 August, 1995, has a binding effect on the department, but not on the Court. This circular clarifies the requirement of law in respect of service of notice under sub-section (2) of Section 143 of the Act. Accordingly, we conclude even for the purpose of Chapter XIV-B of the Act, for the determination of undisclosed income for a block period under the provisions of Section 158 BC, the provisions of Section 142 and sub-sections (2) and (3) of Section 143 are applicable and no assessment could be made without issuing notice under Section 143(2) of the Act. However, it is contended by Sri Shekhar, learned counsel for the department that in view of the expression "So far as may be" in Section 153 BC(b), the issue of notice is not mandatory but optional and are to be applied to the extent practicable. In support of that contention, the learned counsel has relied on the observation made by this Court in Dr. Pratap Singh's case [1985] 22 Taxman 30 (Madras). In this case, the Court has observed that Section 37(2) provides that "the provisions of the Code relating to searches, shall so far as may be, apply to ....
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.... order as to costs." 7. Per contra, Ld. Sr. DR representing the revenue vehemently supported the order of the lower authorities. Ld.Sr. DR placed on record the report of the AO dated 26.09.2024 wherein it is stated by AO as under- "The notice u/s. 148 was issued on 29.03.2019 and directed to file the ITR within a period of 30 days, however, the assessee fails to file his ITR u/s. 148 of the IT Act within the period of 30 days. Further, it is submitted that the assessee has filed a letter dated 22/05/2019 requested to treat the original ITR as ITR filed u/s. 148 of the I.T. Act, 1961. However, this letter was not filed within the time allowed to file ITR in compliance to notice u/s. 148. Hence, no notice u/s. 143(2) has been issued." 8. We have considered the rival submissions, perused the material available on record and judicial pronouncements relied upon by the Ld. AR. To decide the issue raised by the Ld. AR, the relevant provisions of the Act are extracted hereunder: Section 143(2): Applicable on the date of issuance of notice (2) Where a return has been furnished under section 139, or in response to a notice under sub-section (1) of section 142....
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...., in response to a notice served under this section, and (b) subsequently a notice has been served under clause (ii) of sub-section (2) of section 143 after the expiry of twelve months specified in the proviso to clause (ii) of subsection (2) of section 143, but before the expiry of the time limit for making the assessment, reassessment or recomputation as specified in sub- section (2) of section 153, every such notice referred to in this clause shall be deemed to be a valid notice.] [Explanation.-For the removal of doubts, it is hereby declared that nothing contained in the first proviso or the second proviso shall apply to any return which has been furnished on or after the 1st day of October, 2005 in response to a notice served under this section.] (2) The Assessing Officer shall, before issuing any notice under this section, record his reasons for doing so. 9. On perusal of above discussion and after a conjoint reading of the aforesaid provisions, it can be safely gathered that at the relevant point of time i.e., AY 2012-13, the time limit of issuance of notice u/s. 143(2) within a period of one year but before the expiry of the time limit for maki....