Hari Ram Choudhary V. Income Tax Officer, Ward No.1, Nagaur

CW/12441/2012

AI Insights

Hari Ram Choudhary filed a writ petition challenging the notices and proceedings initiated by the Income Tax Officer for the assessment year 2010-2011, claiming that the notices were not served correctly and were beyond the statutory limitation period. The petitioner argued that the notices were sent to an outdated address despite him providing his current address in the tax return. The Income Tax Department contended that the notices were sent to the address registered in the PAN database, which was the petitioner's responsibility to update. The court referenced a Supreme Court decision, emphasizing that the responsibility to update the address lies with the assessee, and upheld the proceedings against the petitioner.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 683516 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 15-02-2023
• Assessment Year: misc
• Other Referred Cases: Principal Commissioner of Income Tax, Mumbai vs. M/s. I-Ven Interactive Limited, Mumbai [AIR 2019 SC 5561]
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: SUNIL BHANDARI
• Assessee Lawyers: VIKAS BALIA; PRIYANSH ARORA
• Keywords: Income Tax Return; Limitation; Notice; Quashment of Order; Service of notice
• Section: 143(2); 139(1); 282

Judgement Text

" [2023/RJJD/005439] (1 of 8) [CW-12441/2012] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 12441/2012 Hari Ram Choudhary s/o Shri Anda Ram Choudhary, by caste Choudhary, aged about 52 years, resident of Near Sheetala Mata Temple, Merta City, Distt. Nagaur. ----Petitioner Versus Income Tax Officer, Ward No.1, Nagaur ----Respondent For Petitioner(s) : Mr. Vikas Balia, Sr. Adv. assisted by Mr. Priyansh Arora For Respondent(s) : Mr. Sunil Bhandari HON'BLE ACTING CHIEF JUSTICE MR. MANINDRA MOHAN SHRIVASTAVA HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT Order 15/02/2023 The petitioner has filed this writ petition seeking quashment of the order dated 13.08.2012 and subsequent notice dated 06.11.2012 issued by the respondents as also proceedings drawn in pursuance of the notices. 2. Quint essential facts giving rise to the present writ petition are that the petitioner submitted his income tax return under Section 139(1) of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') for the assessment year 2010-2011 on 05.10.2010. The petitioner thereafter received a notice dated 03.08.2012 under Section 143(2) of the Act for personal appearance on 13.08.2012. According to the petitioner, the said notice was received by him only on 07.08.2012. In response to the said notice, the petitioner submitted his objection on [2023/RJJD/005439] (2 of 8) [CW-12441/2012] 13.08.2012 stating that the notice is beyond limitation provided under the proviso to Section 143(2) of the Act, and therefore, the proceedings were liable to be dropped. However, his objection was rejected vide order dated 13.08.2012 which was said to be received on 17.08.2012. The petitioner was also intimated vide letter dated 13.08.2012 regarding next date of hearing to be 24.08.2012. The petitioner thereafter collected other relevant information and then made certain representations but the proceedings were not dropped and when another notice fixing date of hearing on 15.11.2012 was received, while reiterating that proceedings could not be continued as barred by limitation, present writ petition came to be filed. 3. Learned counsel for the petitioner argued that while submitting his return for the assessment year 2010-2011, the petitioner had given his present address but instead of sending notice on the said address, notice was given on a previous address of the petitioner. He would also argue that the statement of fact contained in communication dated 13.08.2012 is factually incorrect that the petitioner refused to receive the notice. From the communication made by the Department of Post India (Annexure-12) it is made clear that when the notice was taken, the same was returned with the report that the petitioner was not residing at the given address on 17.09.2011. It is thus clear that there was no service of notice upon the petitioner, as mandated under Section 282 of the Act. The submission of the learned counsel for the petitioner is that once the notice could not be served with the report that the petitioner was not found residing at the said address, it was incumbent on the part of the [2023/RJJD/005439] (3 of 8) [CW-12441/2012] respondent to get the notice served in accordance with the provisions contained in Order 5 Rule 17 CPC. 4. Learned senior counsel for the petitioner further argued that even if it is assumed that no intimation regarding change of the office address is given, if the petitioner was not found, the notices could not be treated as served. As all subsequent efforts to get the notices served on the petitioner could not succeed, after 13.09.2011, proceedings under Section 143 of the IT Act could not be initiated as it was barred by law. 5. On the other hand, learned counsel for the respondents would submit that the petitioner has admitted that two addresses shown in the order dated 13.08.2012 (Annexure-4) were submitted by the petitioner. There is no averment in the writ petition that the petitioner had sent any intimation to the department for change of the address. Therefore, the notices were issued at the address given in the PAN data base which is available with the department. 6. Relying upon the decision of the Supreme Court in the case of Principal Commissioner of Income Tax, Mumbai vs. M/s. I-Ven Interactive Limited, Mumbai [AIR 2019 SC 5561], learned counsel for the respondent would submit that once the notice is sent to assessee at the address as per PAN data base within time limit prescribed under proviso to Section 143(2) of the Act, actual proof of service is not required and there is substantial compliance of the legal requirement. He would further submit that in the aforesaid decision, it is also held that the assessee could not assail the initiation of the proceedings on the basis of [2023/RJJD/005439] (4 of 8) [CW-12441/2012] notice under Section 143(2) of the Act on the ground that a different address was shown in the income tax return. 7. We have heard learned counsel for the parties and perused the records. 8. In the writ petition, the case set out by the petitioner is that notice dated 13.09.2011 under Section 143(2) of the Act was not served on him in accordance with law. In the writ petition, he has stated that the notices were sent at the old addresses contained in the old PAN data base. The petitioner has left the said address and was not residing there any more. 9. The averments made by the petitioner in ground 'D' of the petition are as under: \"D. That the respondent further ignored to consider that notice under Section 143(2) of the Act is required to be given on the present address mentioned in the return itself and such notice cannot be issued on any old PAN data base address and in the present case as no notice was issued to the petitioner at the present address there was no question of refusal on his part.\" 10. Further, the petitioner has also made the following averments in ground 'H' of the writ petition, which reads as under: \"H. That there is no reason why respondent did not sent the notice on address mentioned in the Income Tax Return submitted by the petitioner. In fact, the petitioner neither resides at Rajpura not at Jadoda then how he could have refused to receive the same. This report of refusal appears to be concocted and forge one.\" 11. From the averments made in the writ petition, it is clear that there is an admission on the part of the petitioner that the two addresses shown in the order dated 13.08.2012 (Annexure-4) were the addresses which were intimated by him but according to [2023/RJJD/005439] (5 of 8) [CW-12441/2012] him they are now old PAN data base because the petitioner no longer resides at Rajpura or at Jadoda. There is no averment in the writ petition that the petitioner has given any intimation to the department regarding change of his past residence and office address. 12. In the order dated 13.08.2012 (Annexure-4), it has been stated that the notice under Section 143(2) of the Act was sent to the petitioner on 13.09.2011 by speed post on his office address i.e. address of Rajapura, Degana. 13. Moreover, though we find that the stand taken by the respondent and what has been contained in the order dated 13.08.2012 that the petitioner refused to take notice, is factually not correct, as is reflected from communication dated 05.10.2012 (Annexure-A12) of the Department of Post India, in the same communication, what has been written is that when the notice dated 13.09.2011 was taken at Rajpura for service, it is reported that the petitioner was not residing at the given address. The petitioner has also stated that he no longer resides at the present address. 14. From the aforesaid material on record, what emerges is that the petitioner had intimated to the department his official address at Rajpura on which notice has been sent and the petitioner had left the said place without giving any intimation to the department regarding change to his official address. 15. Therefore, in view of the above factual position obtaining on record, the law laid down by the Supreme Court in the case of M/s. I-Ven Interactive Limited (supra) squarely applies. That was a case where the notices under Section 143(2) of the Act were [2023/RJJD/005439] (6 of 8) [CW-12441/2012] sent on the address given in the PAN data base. Dispute was said to be raised when the notices were not served. In the aforesaid factual scenario their Lordships of the Supreme Court considered the legal position and held as below: \"6.1 At the outset, it is required to be noted that notice under Section 143(2) of the 1961 Act was sent by the Assessing Officer to the assessee at the address as mentioned in the PAN database on 05.10.2007 and the same was within the time limit prescribed in proviso to Section 143(2) of the 1961 Act. However, it was the case on behalf of the assessee that the said notice was not served upon the assessee as the assessee changed its name and address and shifted to new address prior thereto and therefore the said notice was not served upon the assessee and by the time when subsequently the notices were served upon the assessee, notice under Section 143(2) of the 1961 Act was barred by the period prescribed in proviso to Section 143(2) of the 1961 Act and therefore the assessment order is bad in law. It was the case on behalf of the assessee that vide communication dated 06.12.2005 the assessee intimated to the Assessing Officer about the new address and despite the same the Assessing Officer sent the notice at the old address. However, it is required to be noted that the alleged communication dated 06.12.2005 is not forthcoming. Neither the same was produced before the Assessing Officer nor even the same has been produced before this Court. In the affidavit also, filed in compliance with order dated 21.08.2019, the assessee has stated that the alleged communication dated 06.12.2005 is not available. Thus, the assessee has failed to prove the alleged communication dated 06.12.2005. The only document available is Form No.18 filed with the ROC. Filing of Form-18 with the ROC cannot be said to be an intimation to the Assessing Officer with respect to intimation of change in address. It appears that no application was made by the assessee to change the address in the PAN data base and in the PAN database the old address continued. Therefore, in absence of any intimation to the Assessing Officer with respect to change in address, the Assessing Officer was justified in issuing the notice at the address available as per the PAN database. Therefore, the Assessing Officer cannot be said to have committed any error and in fact the Assessing Officer was justified in sending the notice at the address as per the PAN database. If that is so, the notice dated 05.10.2007 can be said to be within the period prescribed in proviso to Section 143(2) of the 1961 Act. Once the notice is issued within the period [2023/RJJD/005439] (7 of 8) [CW-12441/2012] prescribed as per the proviso to Section 143(2) of the Act, the same can be said to be sufficient compliance of Section 143(2) of the 1961 Act. Once the notice is sent within the period prescribed in the proviso to Section 143(2) of the 1961 Act, in that case, actual service of the notice upon the assessee thereafter would be immaterial. In a given case, it may happen that though the notice is sent within the period prescribed, the assessee may avoid actual service of the notice till the period prescribed expired. Even in the relied upon case by the learned Senior Advocate for the assessee in the case of Hotel Blue Moon (2010 AIR SCW 1088) (supra), it is observed that the Assessing Officer must necessarily issue notice under Section 143(2) of the 1961 Act within the time prescribed in the proviso to Section 143(2) of the 1961 Act. Therefore, in the facts and circumstances of the case, the High Court is not justified in dismissing the appeal and confirming the orders passed by the learned C.I.T (Appeals) and the I.T.A.T. setting aside the assessment order solely on the ground that the assessment order is bad in law on the ground that subsequent service of notice upon the assessee under Section 143(2) of the 1961 Act was beyond the time prescribed in the proviso to Section 143(2) of the 1961 Act. 7. Now so far as the observations made by the High Court while concurring with the view of the learned Tribunal that merely by filing of return of income with the new address, it shall be enough for the assessee to discharge its legal responsibility for observing proper procedural steps as per the Companies Act and the Income Tax Act is concerned, we are of the opinion that mere mentioning of the new address in the return of income without specifically intimating the Assessing Officer with respect to change of address and without getting the PAN database changed, is not enough and sufficient. In absence of any specific intimation to the Assessing Officer with respect to change in address and/or change in the name of the assessee, the Assessing Officer would be justified in sending the notice at the available address mentioned in the PAN database of the assessee, more particularly when the return has been filed under E-Module scheme. It is required to be noted that notices under Section 143(2) of the 1961 Act are issued on selection of case generated under automated system of the Department which picks up the address of the assessee from the database of the PAN. Therefore, the change of address in the database of PAN is must, in case of change in the name of the company and/or any change in the registered office or the corporate office and the same has to be intimated to the Registrar of Companies in the prescribed format (Form [2023/RJJD/005439] (8 of 8) [CW-12441/2012] 18) and after completing with the said requirement, the assessee is required to approach the Department with the copy of the said document and the assessee is also required to make an application for change of address in the departmental database of PAN, which in the present case the assessee has failed to do so.\" 16. Apparently, therefore, the notice under Section 143(2) of the Act issued to the petitioner, before expiry of the period of limitation, for being served at the address of his office as per available information on PAN data base would fulfill the legal requirement of service of notice under Section 143(2) of the Act. 17. We find no merit in the writ petition and the same is dismissed accordingly. Interim order stands vacated. (YOGENDRA KUMAR PUROHIT),J (MANINDRA MOHAN SHRIVASTAVA),ACJ 88-MohitTak/- "