Shri Shah Javed Saddat, Saharanpur V. ITO, Uttar Pradesh

CO 86/DEL/2013

• Counselvise Citation: [2016] 123 COUNSELVISE.COM (IT) 2143 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 28 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 19-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 10-02-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 22-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIMA BARNWAL
• Assessee Lawyers: PRATIYUS H JAIN
• Keywords: Principle of natural justice
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SRI C.M.GARG, JM AND SRI O.P. KANT, AM ITA NO. 884/DEL./2013 : A SSTT. YEAR : 2009-10 ITO WARD 1, COURT ROAD, SAHARANPUR UAAR PRADESH VS SHAH JAVED SADDAT S/O. SH. VAKEEL AHMED, MOH. KHANQUA, AMBHETA PEER SAHARANPUR (APPELLANT) (RESPONDENT) PAN NO. ALRPS6434J C.O. NO. 86/DEL/2013 ( ITA NO. 884/DEL./2013) ASSTT. YEAR : 2009-10 SHAH JAVED SADDAT S/O. SH. VAKEEL AHMED, MOH. KHANQUA, AMBHETA PEER SAHARANPUR VS ITO WARD 1, COURT ROAD, SAHARANPUR UAAR PRADESH (APPELLANT) (RESPONDENT) PAN NO. ALRPS6434J ASSESSEE BY : SH. PRATIYUS H JAIN, CA REVENUE BY : SMT. ANIMA BA RNWAL, SR. DR DATE OF HEARING : 10.02.2016 DATE OF PRONOUNCEMENT : 19.02.2016 ORDER PER C.M.GARG, J.M. ABOVE CAPTIONED APPEAL OF THE REVENUE AS WELL AS CROSS OBJECTION OF THE ASSESSEE HAVE BEEN PREFERRED AGAIN ST THE ORDER OF ITA NO. 884/DEL/2013 & CO NO. 86/DEL/2013 SHAH JAVED SADD AT 2 THE COMMISSIONER OF INCOME TAX (APPEALS) MUZAFFARNA GAR DATED 01.11.2012 IN APPEAL NO. 284/11-12/MZR FOR AY 2009- 10. 2. THE LD. DEPARTMENTAL REPRESENTATIVE (DR) AGRE ED THAT THE ARGUMENTS ON THE CROSS OBJECTION OF THE ASSESSEE MA Y KINDLY BE HEARD. THEREFORE, WE HAVE HEARD ARGUMENT OF BOTH TH E SIDES ON THE CROSS OBJECTIONS OF THE ASSESSEE AND ALSO CAREFULLY PERUSED THE RELEVANT MATERIAL PLACED ON RECORD BEFORE US. THE C ROSS OBJECTION OF THE ASSESSEE READ AS UNDER :- 1. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS NO T ADJUDICATED UPON THE GROUND OF APPEAL THAT THE ORDE R UNDER SECTION143(3) WAS NOT VALID AS NOTICE UNDER SECTION 143(2) WAS NOT SERVED ON THE RESPONDENT. 2. THE COMMISSIONER OF INCOME TAX (APPEALS) SHOULD HAVE OBSERVED THAT THE NOTICE UNDER SECTION143(2) WAS NO T VALID FR NOT PROVIDING ANY REASONABLE TIME FOR COMPLIANCE TO THE RESPONDENT. 3. FIRST OF ALL, THE LD. DEPARTMENTAL REPRESENTATIV E (DR) POSED A LEGAL OBJECTION THAT THE ASSESSEE DID NOT PRESS H IS LEGAL GROUND NO. 5 BEFORE THE CIT(A) DURING FIRST APPELLATE PROCEEDI NGS AND GROUND NO 5 OF THE ASSESSEE CHALLENGING THE SERVICE OF THE NOTICE U/S 143(2) OF THE ACT OF THE INCOME TAX ACT, 1961( FOR SHORT A S THE ACT) HAS BEEN DISMISSED AS NOT PRESSED, THEREFORE, THE ASSES SEE CANNOT RASIED THIS ISSUE BY WAY OF CROSS OBJECTION. 4. THE LD. ASSESSEES REPRESENTATIVE (AR) FAIRLY ACCEPTED THAT THE ASSESSEE DID NOT PRESS GROUND NO. 5 BEFORE THE CIT(A). HOWEVER, THE LD AR DRAWING OUR ATTENTION TOWARDS PA RAGRAPH NO. 3.3.1 OF THE CIT(A) POINTED OUT THAT THE ASSESSEE D ID NOT PRESS GROUND NO. 5 WITH A REQUEST THAT IF THE CASE WAS CO NSIDERED BY THE FIRST APPELLATE AUTHORITY ON MERITS OF ADDITIONS MA DE THEN HE VERBALLY SUBMITTED NOT TO PRESS THE RELEVANT GROUN D NO. 5 AND THE ITA NO. 884/DEL/2013 & CO NO. 86/DEL/2013 SHAH JAVED SADD AT 3 SAME WAS DISMISSED. THE LD. AR VEHEMENTLY CONTENDED THAT WHEN THE CIT(A) GRANTED RELIEF TO THE ASSESSEE ON MERITS AND THE REVENUE IS NOT ACCEPTING THE SAME AND FURTHER CHALLENGING T HE CONCLUSION BY WAY OF FILING APPEAL BEFORE THE TRIBUNAL THEN THE A SSESSEE HAS NO ALTERNATE BUT TO RE-AGITATE THE LEGAL OBJECTION BY WAY OF CROSS OBJECTION WHICH WAS POSED BEFORE THE CIT(A) AS GROU ND NO. 5. 5. ON CAREFULLY CONSIDERATION OF ABOVE RIVAL SUBM ISSIONS OF BOTH THE SIDES, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE DID NOT PRESS LEGAL GROUND NO. 5 BEFORE CIT(A) TO NARRO W DOWN THE DISPUTE WHICH RESULTED INTO RELIEF FOR HIM FROM THE CIT(A) ON MERITS. HOWEVER, THE REVENUE FILED AN APPEAL CHALLE NGING THE ORDER OF THE CIT(A) WHICH GRANTED RELIEF TO THE ASSESSEE, THEREFORE, THE ASSESSEE CANNOT BE PREVENTED TO AGITATE THE LEGAL G ROUND CHALLENGING THE VALIDITY OF SERVICE OF NOTICE U/S 143(2) OF THE ACT. HENCE, LEGAL OBJECTION OF THE LD. DR IS DISMISSED. 6. THE LD. AR DRAWN OUR ATTENTION TOWARDS LETTER DATED 7.11.2011 FROM THE OFFICE OF THE SR. POST MASTER, S AHARANPUR WHEREIN THE ITO, SAHARANPUR WAS INFORMED ABOUT THE SERVICE OF THE NOTICE ON THE ASSESSEE THAT SPEED POST U/R HAS NOT RECEIVED IN THE OFFICE OF THE SR. POST MASTER FOR DELIVERY. THE LD. AR VEHEMENTLY CONTENDED THAT WHEN THE RESPECTIVE SR. POST MASTER DID NOT RECEIVE THE SPEED POST WHEREIN THE NOTICE U/S 143(2) OF THE ACT WAS ISSUED TO THE ASSESSEE THEN VALID SERVICE ON THE NOTICE OF TH E ASSESSEE CANNOT BE PRESUMED. PLACING RELIANCE ON THE DECISIONS OF H ONBLE HIGH COURT OF DELHI IN THE CASE OF CIT VS. SILVER STREAK TRADING P. LTD. REPORTED AS 326 ITR 418. THE LD. COUNSEL POINTED OU T THAT AS PER FACTS SUBMITTED BY THE REVENUE, NOTICE WAS ISSUED O N 30.8.2010 ITA NO. 884/DEL/2013 & CO NO. 86/DEL/2013 SHAH JAVED SADD AT 4 FIXING THE DATE OF HEARING ON 31.8.2010 WHICH A MOC KERY OF PROCEEDINGS AS IF IT IS PRESUMED THAT THE NOTICE IS SUED TO THE ASSESSEE WILL BE SERVED ON 31.8.2010 THEN ALSO HOW THE ASSESSEE WOULD BE ABLE TO SUBMIT HIS REPLY BEFORE THE AUTHOR ITY CONCERN ON THE SAME DAY I.E. 31.8.2010. THE LD. AR FURTHER POI NTED OUT THAT EVEN ASSUMING BUT NOT ACCEPTING THAT THE NOTICE WAS SERVED ON THE ASSESSEE ON 31.8.2010 THEN NO SUFFICIENT TIME WAS G IVEN TO THE ASSESSEE FOR SUBMITTING HIS REPLY THEREFORE IT IS A CLEAR VIOLATION OF PRINCIPLES OF NATURAL JUSTICE BY THE AO. FOR THIS PROPOSITION THE LD. AR TO SUPPORT HAS PLACED RELIANCE ON THE FOLLOWING DECISIONS OF HONBLE HIGH COURT AND TRIBUNAL (I) MUNNA LAL MURLI DHAR VS. CIT REPORTED AS 79 ITR 540 (ALL.) (II) M. MOHD. ISHAQ V S. CIT REPORTED AS 27 ITR 510 (PUNJAB). 7. ON REPLYING TO THE ABOVE, LD. DR SUBMITTED THAT THE UNDISPUTEDLY AND ADMITTEDLY THE NOTICE WAS SENT TO THE ASSESSEE THROUGH SPEED POST UNDER ARTICLE NO. EU41939695IN O N 30.8.2010 ON THE ADDRESS MOHALLA KHANQUA SHAREEF, AMBETA PEE R, SAHARANPUR. IN THIS SITUATION COMPLIANCE OF SECTIO N 143(2) OF THE ACT HAS TO BE HELD AS COMPLIED. THE LD. DR DRAWN OU R ATTENTION TOWARDS COPIES OF THE NOTICE AVAILABLE AT PAGE 4 OF THE ASSESSEES PAPER BOOK SUBMITTED THAT THE FIRST NOTICE WAS ISSU ED ON 23.8.2010 WHICH WAS HANDED OVER TO THE POSTAL AUTHORITIES ON 30.8.2010 FOR SERVICE UPON THE ASSESSEE WITHIN PRESCRIBED TIME, T HEREFORE, LEGAL OBJECTION OF THE ASSESSEE IS NOT SUSTAINABLE. 8. ON CAREFULLY CONSIDERATION OF RIVAL SUBMISSI ONS OF BOTH THE SIDES AT THE VERY OUTSET WE MAY POINT OUT THAT AS PER PROVISO TO OF SECTION 143(2)(II) OF THE ACT NO NOTICE UNDER SA ID CLAUSE (II) ITA NO. 884/DEL/2013 & CO NO. 86/DEL/2013 SHAH JAVED SADD AT 5 SHALL BE SERVED ON THE ASSESSEE AFTER EXPIRY OF 6 M ONTHS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE RETURN IS FU RNISHED. IN THE PRESENT CASE, AS PER ASSESSMENT ORDER, THE ASSESSE E FILED HIS RETURN OF INCOME ON 30.4.2009 AND NOTICE U/S 143(2) OF THE ACT COULD BE VALIDLY SERVED ON THE ASSESSEE ON OR BEFORE 30.9.20 10. IN THIS SITUATION AS PER PROVISO TO SECTION 143(2)(II) OF T HE ACT IT IS MANDATORY THAT THE NOTICE UNDER THIS PROVISION SHOU LD BE SERVED UPON THE ASSESSEE WITHIN 6 MONTHS FROM THE END OF R ELEVANT FINANCIAL YEAR WHEREIN THE RETURN WAS FILED. IN THE PRESENT C ASE, THE LD. DR IS HARPING ON THE FACT THAT THE AO ISSUED NOTICE ON 30 .8.2010 WHICH WAS PRESSED INTO SERVICE THROUGH POSTAL AUTHORITIES ON 30.8.2010 BY WAY OF HANDING OVER THE ENVELOPE TO THE POSTAL AUTH ORITIES BUT THE LD. DR COULD NOT SHOW ANY PROOF OF SERVICE UPON THE ASSESSEE ON OR BEFORE 30.9.2010. 9. AT THIS STAGE, IT IS PERTINENT TO TAKE COGNIZANC E OF THE FACT INFORMED BY THE SR. POST MASTER, SAHARANPUR TO THE ITO/AO BY LETTER DATED 7.11.2011 WHEREIN IT WAS INFORMED TO THE AO T HAT SPEED POST UNDER RECEIPT HAS NOT BEEN RECEIVED TO THE POST OFF ICE FOR DELIVERY. WHEN THE ENVELOPE CONTAINING NOTICE U/S 143(2) OF T HE ACT ISSUED AGAINST THE ASSESSEE WAS NOT RECEIVED BY THE OFFICE CONCERN FOR SERVICE UPON THE ASSESSEE THEN IT CANNOT BE PRESUME D THAT THE SAME WAS VALIDLY SERVED UPON THE ASSESSEE. PER CONTRA, U NDER ABOVE NOTED FACTS AND CIRCUMSTANCES IT CAN SAFELY BE PRESUMED T HAT THE REVENUE DEPARTMENT COULD NOT ESTABLISH THE VERY FACT OF VAL ID SERVICE OF NOTICE UPON THE ASSESSEE U/S 143(2) OF THE ACT WITH IN THE PRESCRIBED LIMIT MANDATED BY PROVISO TO SECTION 143(2) (II) OF THE ACT I.E. ON OR BEFORE 30.9.2010. THEREFORE, WE ARE INCLINED TO HOL D THAT NO NOTICE ITA NO. 884/DEL/2013 & CO NO. 86/DEL/2013 SHAH JAVED SADD AT 6 U/W 143(2) OF THE ACT WAS SERVED UPON THE ASSESSEE WHICH A MANDATORY CONDITIONS FOR VALID SCRUTINY ASSESSMENT U/S 143(3) OF THE ACT. THEREFORE, IMPUGNED ASSESSMENT ORDER DATED 28. 12.2011 IS QUASHED BEING BAD IN LAW AND VOID AB INITIO. ACCORD INGLY, CROSS OBJECTIONS OF THE ASSESSEE ARE ALLOWED. 9. SINCE BY THE EARLIER PART OF THIS ORDER, WE HA VE ALLOWED CROSS OBJECTIONS OF THE ASSESSEE QUASHING THE IMPU GNED ASSESSMENT ORDER, THEREFORE, GROUNDS RAISED BY THE REVENUE ON MERITS IN ITS APPEAL BECOMES ACADEMIC AND INFRUCTUOUS AND WE DIS MISS THE SAME BEING INFRUCTUOUS. 10. IN THE RESULT, CROSS OBJECTIONS OF THE ASSES SEE IS ALLOWED AND APPEAL OF THE REVENUE IS DISMISSED BEING INFRUC TUOUS. ORDER PRONOUNCED IN THE COURT ON 19/02/2016. SD/- SD/- (O.P.KANT) (C.M.GA RG) ACCOUNTANT MEMBER JUDICI AL MEMBER DATED: 19 / 02/2016 *BINITA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ITA NO. 884/DEL/2013 & CO NO. 86/DEL/2013 SHAH JAVED SADD AT 7 DATE INITIAL 1. DRAFT DICTATED ON 10.02.2016 2. DRAFT PLACED BEFORE AUTHOR 10.02.2016 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS PS/PS 6. KEPT FOR PRONOUNCEMENT ON 19.02.2016 PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.