Asstt. CIT,Cir.1, Nashik, Nashik V. Shri Shashikant P. Wani, Nashik

ITA 1194/PUN/2009

• Counselvise Citation: 119424514 RSA 2009
• Duration Of Justice: 1 year(s) 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-05-2011
• Assessment Year: misc
• Appeal Filed On: 05-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S C SHIVGUNDE
• Keywords: Period of limitation; Procedural lapse; Block assessment; Time period of passing order
• Section: 143(3); 142(1); 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER I.T.A. NO. 1194/PN/09 (BLOCK ASSTT. YEARS: 1997-98 TO 2003-04) ASSTT. COMMISSIONER OF INCOME-TAX, .. APPELLANT CIR.1, NASHIK VS. SHRI SHASHIKANT P. WANI, .. RESPONDEN T 401/402 TURNING POINT, CANADA CORNER, NASHIK PAN AAAPW 9524H APPELLANT BY: SHRI S C SHIVGUNDE RESPONDENT BY: WRITTEN SUBMISSIONS ORDER PER G.S. PANNU, AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-II, NASHIK DATED 20.7.2009 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 16.3.2007 PASSED BY THE ASSESSING OFFICER UNDER SECTION 158BD READ WITH SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHOR T THE ACT), PERTAINING TO THE BLOCK ASSESSMENT YEARS 1997-98 TO 2003-04. 2. IN THIS APPEAL, THE REVENUE HAS RAISED MULTIPLE GROUNDS AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS). ONE O F THE ISSUES DECIDED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) AGAINST THE RE VENUE IS TO THE EFFECT THAT THE IMPUGNED ASSESSMENT FRAMED UNDER SECTION 158BD READ WITH SECTION 143(3) OF THE ACT DATED 16.3.2007 WAS INVALID, BECAUSE ASS ESSEE WAS NOT SERVED WITH THE NOTICE UNDER SECTION 143(2) OF THE ACT WITHIN T HE PRESCRIBED PERIOD OF 12 MONTHS FROM THE END OF THE MONTH IN WHICH THE RETUR N OF INCOME WAS FILED. SINCE THIS ASPECT OF THE CONTROVERSY GOES TO THE ROOT OF THE MATTER, THE CAPTIONED APPEAL WAS HEARD ON THIS ASPECT ONLY, ON THE BASIS OF THE SUBMISSIONS PUT-FORTH BY THE LEARNED DEPARTMENTAL REPRESENTATIVE AND THE WRITTEN SUBMISSIONS FURNISHED ON BEHALF OF THE RESPONDENT-ASSESSEE. ITA NO 1194/PN/09 SHRI S P WANI, NASHIK 2 3. IN THIS CASE, THE ASSESSEE FILED A RETURN OF INC OME FOR THE BLOCK PERIOD 1.4.1996 TO 25.3.2003 ON 15.4.2005. NOTICE UNDER SE CTION 143(2) WAS ISSUED ON 29.6.2006, I.E. AFTER 12 MONTHS OF FILING OF THE RE TURN. THE COMMISSIONER OF INCOME-TAX (APPEALS), IN THESE CIRCUMSTANCES, HAS C ONCLUDED THAT ISSUANCE OF SUCH NOTICE IS BEYOND THE PRESCRIBED PERIOD AND, TH EREFORE, CONSEQUENTIAL ASSESSMENT FRAMED SUFFERS FROM A JURISDICTIONAL ERR OR. FOLLOWING THE DECISION OF THE HONBLE GAUHATI HIGH COURT IN THE CASE OF SMT B ANDANA GOGOI VS. CIT 289 ITR 281 (GAU), THE COMMISSIONER OF INCOME-TAX (APPE ALS) HELD THAT SINCE THE ASSESSING OFFICER ASSUMED JURISDICTION IN THE PRESE NT CASE WITHOUT ISSUANCE OF A VALID NOTICE AS PROVIDED IN SECTION 143(2) OF THE A CT, SUCH ASSESSMENT WAS TO BE QUASHED. 4. BEFORE US, THE ONLY PLEA RAISED BY THE LEARNED D EPARTMENTAL REPRESENTATIVE IS ON THE SAME LINES AS ADOPTED BY T HE ASSESSING OFFICER DURING REMAND PROCEEDINGS BEFORE THE COMMISSIONER OF INCOM E-TAX (APPEALS). AS PER THE LEARNED DEPARTMENTAL REPRESENTATIVE, THE ASSESS EE NEVER RAISED THE OBJECTION REGARDING THE EXPIRY OF THE LIMITATION TO ISSUE NOTICE BEFORE THE ASSESSING OFFICER AND THAT THE LIMITATION PERIOD FO R ISSUANCE OF NOTICE UNDER SECTION 143(2) APPLIES ONLY IN CASES WHERE RETURN H AS BEEN FURNISHED UNDER SECTION 139 OR IN RESPONSE TO A NOTICE UNDER SECTIO N 142(1) OF THE ACT AND NOT IN BLOCK ASSESSMENT CASES. 5. WE HAVE CAREFULLY CONSIDERED THE OBJECTION RAISE D BY THE LEARNED DEPARTMENTAL REPRESENTATIVE AND FIND NO MERIT IN TH E SAME. THE HONBLE SUPREME COURT IN THE CASE OF ACIT V HOTEL BLUE MOON 321 ITR 362 (SC) HAS FINALLY SETTLED THE ISSUE. AS PER THE HONBLE SUPRE ME COURT, IF AN ASSESSMENT IS TO BE COMPLETED UNDER SECTION 143(3) READ WITH SECT ION 158BC, NOTICE UNDER SECTION 143(2) SHALL BE ISSUED WITHIN ONE YEAR FROM THE DATE OF FILING OF THE BLOCK RETURN AND ANY SUCH OMISSION ON THE PART OF THE ASS ESSING OFFICER, IS NEITHER A PROCEDURAL IRREGULARITY AND NOR IS IT CURABLE. ACCO RDING TO THE HONBLE SUPREME COURT, ISSUANCE OF A NOTICE UNDER SECTION 143(2) OF THE ACT IS MANDATORY AND IT IS THE VERY FOUNDATION FOR ASSUMING JURISDICTION TO MA KE AN ASSESSMENT UNDER ITA NO 1194/PN/09 SHRI S P WANI, NASHIK 3 SECTION 158BC OF THE ACT. IN OTHER WORDS, A NOTICE UNDER SECTION 143(2) NOT ISSUED WITHIN THE PRESCRIBED PERIOD RESULTS IN AN I NVALID ASSESSMENT UNDER SECTION 158BC READ WITH SECTION 143(2) OF THE ACT. FOLLOWING THE AFORESAID JUDGMENT OF THE HONBLE SUPREME COURT, IN THE PRESE NT CASE IT IS UNDISPUTABLE THAT NOTICE UNDER SECTION 143(2) HAS NOT BEEN SERVE D ON THE ASSESSEE WITHIN THE PRESCRIBED TIME LIMIT AND, THEREFORE, THE IMPUGNED BLOCK ASSESSMENT FRAMED UNDER SECTION 158BC OF THE ACT IS NOT VALID. ACCORD INGLY, WE ARE NOT INCLINED TO INTERFERE WITH THE ORDER OF THE COMMISSIONER OF INC OME-TAX (APPEALS) HOLDING THAT THE ASSESSING OFFICER ASSUMED JURISDICTION IN THE P RESENT CASE WITHOUT ISSUANCE OF A VALID NOTICE UNDER SECTION 143(2) OF THE ACT. IN OUR VIEW, HAVING REGARD TO THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE O F HOTEL BLUE MOON (SUPRA), THE COMMISSIONER OF INCOME-TAX (APPEALS) MADE NO MI STAKE IN QUASHING THE IMPUGNED ASSESSMENT. ACCORDINGLY, REVENUE FAILS ON THIS ASPECT. 6. SINCE THE QUASHING OF ASSESSMENT BY THE COMMISSI ONER OF INCOME-TAX (APPEALS) HAS BEEN AFFIRMED BY US, OTHER ISSUES RAI SED BY THE REVENUE IN THE CAPTIONED APPEAL BECOME ACADEMIC AND NO ADJUDICATIO N IS THEREFORE CALLED FOR ON SUCH ISSUES. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED, AS ABOVE. DECISION PRONOUNCED IN THE OPEN COURT ON THIS 11 TH DAY OF MAY, 2011. SD/- SD/- (SHAILENDRA KUMAR YADAV) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER PUNE: DATED: 11 TH MAY, 2011 B COPY OF THE ORDER IS FORWARDED TO : 1. SHRI SHASHIKANT P WANI, NASHIK 2. THE ACIT, CIR.1, NASHIK 3. THE CIT(A)-II, NASHIK 4. THE CIT (CEN), NASHIK 5. THE D.R, B BENCH, PUNE 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, PUNE BENCHES, PUNE ITA NO 1194/PN/09 SHRI S P WANI, NASHIK 4