DR.MUKESH KUMAR SRIVASTAVA V. COMMISSIONER OF INCOME TAX,JAM

T.A./24/2002

AI Insights

The case revolves around a tax appeal by Dr. Mukesh Kr. Shrivastava against the ex parte assessment orders for the period from 01.04.1986 to 18.10.1996. The appellant contested the validity of the assessment, claiming improper service of notice and a lack of reasonable opportunity to respond, particularly highlighting that the notices were served while he was incarcerated in Patna. The court examined the procedural fairness of the notices served under Sections 158BC and 142(1) of the Income Tax Act, 1961, and found that the appellant was not given a proper opportunity to contest the assessments due to his incarceration and the manner of service of notices.

• Counselvise Citation: [2016] 140 COUNSELVISE.COM (IT) 674241 (HC-JHARKHAND)
• Appeal Type: Others
• Pronouncement Date: 24-08-2016
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: DEEPAK ROSHAN
• Assessee Lawyers: DARSHANA MISHRA
• Keywords: Assessment Order; Ex parte assessment; Judicial Custody; Proper service of notice; Reasonable opportunity of hearing
• Section: 142(1); 158BC

Judgement Text

"IN THE HIGH COURT OF JHARKHAND AT RANCHI Tax Appeal No.24 of 2002 Dr. Mukesh Kr. Shrivastava, S/o Sri Bipin Bihari Shrivastava, C/o Rajesh Kr. Shrivastava (Brother),34, Khasmahal, Tata Chaibasa Road, Jamshedpur … … … … … … Appellant Versus 1. The Commissioner of Income Tax, Jamshedpur 2. The Asstt. Commissioner of Income-tax (Inv.) Circle, Jamshedpur … … ... … ... ... Respondents ------ CORAM: HON'BLE MR. JUSTICE D. N. PATEL HON'BLE MR. JUSTICE RATNAKER BHENGRA ----- For the Appellant: M/s. Darshana Poddar Mishra For the Respondents: M/s. Deepak Roshan ------ 18/Dated: 24th August, 2016 Per D.N. Patel, J. 1) This Tax Appeal has been preferred raising the following substantial questions of Law: - (i) Whether on the facts of the case and in law the ex parte assessment order is bad for want of proper service of notice and reasonable opportunity of hearing? (ii) Whether there is clear cut violation and equity and natural justice in completing the assessment for period of 10 years (01.04.1986 to 18.10.1996) by giving less than one week notice and that too when the appellant was in Jail at Patna far away from his place of employment/residence? 2) Having heard learned counsels for both sides and looking to the facts and circumstances of the case, it appears that the search was carried out at the premises of this appellant on 18th October, 1996. The notice was served upon the brother of this appellant under Section 158BC of the Income Tax Act, 1961. Counsel for the appellant has also raised objection to the service of notice upon the brother and not upon this appellant, nonetheless, it is submitted by the counsel for the appellant that notice under Section 142(1) of the Income Tax Act, 1961 dated 23rd September, 1997 was served on 25th September, 1997 in the Jail at Patna, because, this appellant was arrested on 4th August, 1997. Arrest memo is annexed with the affidavit filed in this Tax Appeal. He was arrested by Central Bureau of Investigation. Questionnaire was also served along with notice under Section 142(1) of the Income Tax Act in the jail. The reply was to be given on or before 1st October, 1997. As he was in jail, it was not possible for the appellant to reply this questionnaire and ultimately, ex parte order was passed on 31st -2- October, 1997 and was served upon this appellant in the Jail at Patna. It is also contended by the counsel for the appellant that this appellant was enlarged on on 6th May, 1998 (Annexure 9 to the supplementary affidavit filed by this appellant). Thus, notice under Section 142(1) of the Act was served when this appellant was in jail. Even questionnaire was also given along with this notice which was to be replied on or before 1st October, 1997 when this appellant was in jail and the ex parte order was passed on 31st October, 1997 by the Assessing Officer, Jamshedpur while the appellant was in Jail. 3) Counsel for the respondents submitted that the brother of the appellant was served with the notice. 4) In fact, the notices are to be served upon the assessee. Admittedly, in the facts of the case, notice was not served upon this appellant and the notice under Section 142(1) was served in the Jail. Looking to this aspect of the matter and as he was not in a position to give any reply when he was in judicial custody in jail at Patna, ex parte order was passed by the Assessing Officer, Jamshedpur dated 31st October, 1997 which is annexed at Annexure 1 to the memo of this Tax Appeal. Hence, the said order passed by the Assessing Officer dated 31st October, 1997 is hereby quashed and set aside. The matter is remanded for fresh assessment order to be passed by the Assessing Officer, Jamshedpur after giving adequate opportunity of being heard to this appellant. The appellant will approach the Assessing Officer, Jamshedpur on 27th October, 2016 between 11.00 am to 01.00 pm. The Assessing Officer will allow this appellant to comply with the requirement of Annexure 4 which is a questionnaire which was supplied along with the notice under Section 142(1) of the Income Tax Act, 1961. Subsequent order passed by the Income Tax Appellate Tribunal, Patna Bench, Patna in IT(SS)A No.101/Pat/1997 for the block year 01.04.1986 to 18.10.1996 dated 29th January, 2002 is also hereby quashed and set aside. Accordingly, both the substantial questions of law raised in this Tax Appeal are answered in affirmative. 5) This Tax Appeal is allowed to the aforesaid extent. (D. N. Patel, J) Manoj/ (Ratnaker Bhengra, J) "