ITO, Ludhiana V. Smt. Resham Kaur (widow), Ludhiana

ITA 1465/CHANDI/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 51436 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2011
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 23-08-2011
• Assessment Year: 1999-2000
• Appeal Filed On: 31-12-2010
• Court: TRIBUNAL
• Department Lawyers: JAI SHREE SHARMA
• Keywords: Invalid notice
• Section: 147; 148; 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL: CHANDIGARH BENCH B BEFORE HONBLE MS SUSHMA CHOWLA, JM AND HONBLE SHRI MEHAR SINGH, AM I.T.A. NO. 1465/CHANDI/2010 AY 1999-2000 I.T.O. WARD IV(1), LUDHIANA V. N IRANJAN SINGH (DECEASED) 129, NEW CYCLE MARKET, GILL ROAD, LUDHIANA PAN: CROSS OBJECTIONS NO. 17/C HANDI/2011 ARISING OUT OF I.T.A. NO. 1465/CHANDI/2010 AY 1999-2000 NIRANJAN SINGH (DECEASED) V. I.T.O. WARD IV(1), LUDHIANA 129, NEW CYCLE MARKET, GILL ROAD, LUDHIANA PAN: (APPELLANT (RESPONDENT) APPELLANT BY : SMT. JAISHREE SHARMA RESPONDENT BY: NONE DATE OF HEARING: 24.8.2011 DATE OF PRONOUNCEMENT: 26 .8.2011 ORDER PER MEHAR SINGH, AM THE PRESENT APPEAL OF THE REVENUE AND THE CROSS OB JECTION FILED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 1999-2000, ARE DIRECTED AGAINST THE ORDER OF LD. CIT(A)-II, LUDHIANA DATED 19.10.2010 P ASSED U/S 250(6) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO I N SHORT AS THE ACT. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 1 THAT THE LD. CIT(A)-II HAS ERRED IN LAW AND ON F ACTS IN HOLDING THAT NOTICE U/S 148 ISSUED TO THE ASSESSEE WAS TIME BARRED THOUGH THE NOTICE WAS SERVED ON 31.3.2006 ON SON OF THE ASSESSEE WHICH WAS WITHIN TIME LIMIT OF ISSUE OF NOTICE OF 1 48. ITA NO. 1465/CHANDI/2010 CO NO. 17/CHANDI/2011 ITO V. NIRANJAN SINGH 2 2 THAT THE ORDER OF THE LD. CIT(A)-II BE SET ASIDE AND THAT OF THE AO BE RESTORED. ITA NO. 1465/CHANDI/2010 AY 1999-2000 REVENUES APPEAL 2. THE BRIEF AND UNDISPUTED FACTS, AS CULLED OUT FR OM THE RECORD REVEALED THAT THE AO RECEIVED INFORMATION FROM THE DEPUTY DIRECTOR OF INCOME TAX (INVG)-II, LUDHIANA THAT THE ASSESSEE WA S A PROPERTY DEALER ALSO DOING BUSINESS OF CYCLE PARTS, FAILED TO EXPL AIN THE SOURCE OF DEPOSIT MADE IN THE BANK ACCOUNT AND ALSO PURCHASED PROPERT Y OF RS. 6,90,000/- AND RECEIPT OF RENTAL INCOME OF RS. 7000/- PER MONT H. ON THE BASIS OF ABOVE INFORMATION, THE AO ISSUED NOTICE U/S 148 OF THE ACT WHICH WAS SERVED ON 30.3.2006 ON THE APPELLANTS SON. NO RET URN IN RESPONSE TO THIS NOTICE FILED BY THE APPELLANT. THEREAFTER, THE AO ISSUED A FRESH NOTICE U/S 142(1) DATED 14.6.2006 WHICH WAS SERVED FOR 29.6.20 06. IN RESPONSE OF THIS THE WIDOW OF THE ASSESSEE ATTENDED AND STATED BEFORE THE AO THAT SHRI NIRANJAN SINGH (ASSESSEE) HAS EXPIRED ON NOVEMBER, 2004. THE AO ISSUED A NOTICE TO THE WIDOW AND SON OF THE ASSESSE E TO FURNISH THE INFORMATION. THEY WERE UNABLE TO PROVIDE ANY INFOR MATION. THE AO MADE HIS ASSESSMENT AFTER TAKING INTO ACCOUNT THE INFORM ATION/DOCUMENTS RECEIVED FROM THE D.I.WING AS WELL AS INFORMATION R ECEIVED FROM THE BANK. 3. THE LD. CIT(A), IN THE COURSE OF APPELLATE PROCE EDINGS, OBSERVED THAT NOTICE U/S 148 WAS SENT, ON 1.4.2006, RETURNED UN-SERVED, ON 5.4.2006 AND OTHER GROUNDS OF THE AO THAT THERE IS NOTICE U/ S 148 ON WHICH THE SIGNATURE OF SHRI TARLOCHAN SINGH APPEARED WITH DAT E 30.3.2006 ALONG WITH THE SIGNATURES OF INSPECTOR DID NOT HOLD GOOD FOR THE SIMPLE REASON THAT IF THE AO HAD ALREADY GOT SERVED NOTICE IN PER SON, ON 30.3.2006, THERE WAS NO NECESSITY TO DELIVER THE SIMILAR NOTICE IN T HE POST OFFICE, ON 1.4.2006 AFTER THE LIMITATION DATE OF 31.3.2006, FO R FURTHER SERVICE ON THE APPELLANT. ON THE DATE OF HEARING, IE..18.10.2010 B OTH THE LD. COUNSEL FOR THE ASSESSEE SHRI M.S. MAHAY, ITP AND SMT. BALWINDE R KAUR, ITO WARD IV(1), LUDHIANA APPEARED AND DISCUSSED THE FACTS OF THE CASE. THE ORDER SHEET ENTRY DATED 18.10.2010 IS REPRODUCED HERE: LD. COUNSEL FOR THE ASSESSEE SHRI M.S. MAHAY AND T HE AO I.E. ITO, WARD IV(1), LUDHIANA ATTENDED. COUNSEL FILED WRITTE N REPLY STATING ITA NO. 1465/CHANDI/2010 CO NO. 17/CHANDI/2011 ITO V. NIRANJAN SINGH 3 THAT NOTICE U/S 148 WAS SENT BY POST FOR ASSESSMENT YEAR 1999-2000 ON 1.4.2006 WHICH IS TIME BARRED. THE AO VERIFIED THE SAME AND CONFIRMED SAME AS PER RECORD. FROM THE ABOVE POSITION IT IS CLEAR THAT THE NOTICE U/S 148 ISSUED TO THE ASSESSEE IS TIME BARRED. THEREFORE THE PROCEEDINGS U/S 147/148 AND ADDITIONS MADE DURING THAT PROCEEDINGS ARE NOT SUST AINABLE. HENCE THE ORDER PASSED BY THE AO IS CANCELLED AND GROUNDS OF .THE APPEAL OF THE ASSESSEE ARE ALLOWED. 4. LD. DR HAS SUPPORTED THE ORDER OF LD. AO AND F URTHER CONTENDED THAT THE DATE OF COMMUNICATION OF THE ORDER OF THE LD. CIT(A), HAS NOT BEEN CORRECTLY MENTIONED, IN APPEAL MEMO, AS 19.1 0.10. THE ITO WARD 4(1), LUDHIANA VIDE ORDER DATED 14.3.11, HAS COMMUN ICATED THE DATE OF RECEIPT OF IMPUGNED APPELLATE ORDER, AS 3.11.2010 A ND STATED THAT THERE IS NO DELAY IN FILING OF APPEAL. THE CONTENTION OF TH E REVENUE REMAINED UNASSAILABLE. THEREFORE, IT IS EVIDENT THAT THERE IS NO DELAY IN FILING OF APPEAL WITHIN MEANING PROVISO TO SEC 253 (3) OF TH E ACT. 5. WE HAVE CAREFULLY PERUSED THE FACTS OF THE CASE, RELEVANT PAPER BOOK FILED BY THE ASSESSEE AND THE SUBMISSIONS OF THE RE VENUE. THERE IS CLEAR FINDING THAT THE IMPUGNED NOTICE U/S 148 OF THE ACT IS TIME-BARRED. THEREFORE THE AO IS NOT COMPETENT TO ASSUME JURISDI CTION ON THE FOUNDATION OF A TIME BARRED NOTICE ISSUED U/S 148 R .W. 147 OF THE ACT. IT IS WELL SETTLED LEGAL PROPOSITION THAT THE PROVISION O F JURISDICTION ARE REQUIRED TO BE INTERPRETED STRICTLY. IT IS, FURTHE R, STATED THAT THE JURISDICTION CANNOT BE ASSUMED BY WAY OF INFERENCE AND ASSUMPTIONS. FOR PROPER ASSUMPTION OF JURISDICTION U/S 148 OF THE AC T, IT IS STATUTORILY IMPERATIVE THAT VALID NOTICE MUST BE ISSUED, AS CON TEMPLATED U/S 149 OF THE ACT. THE AO FAILED TO ISSUE NOTICE U/S 148 OF THE ACT WITH IN THE TIME LIMIT PRESCRIBED U/S 149 OF THE ACT. IN VIEW OF TH IS IT IS A CLEAR CASE WHERE JURISDICTIONAL FACT DOES NOT EXIST. CONSEQ UENTLY THE AO IS NOT LEGALLY COMPETENT ADJUDICATE THE FACTS IN ISSUE. IN THIS CASE, THE AO ERRONEOUSLY ASSUMED JURISDICTION AND CONSEQUENTING ACTION, IS ABINITIO- VOID. IN VIEW OF ABOVE LEGAL AND FACTUAL DISCUSSION , WE DO NOT FIND ANY MERIT IN THE GROUNDS OF APPEAL RAISED BY THE REVENU E. THEREFORE, THE FINDINGS OF THE LD. CIT(A) ARE UPHELD. ITA NO. 1465/CHANDI/2010 CO NO. 17/CHANDI/2011 ITO V. NIRANJAN SINGH 4 9. APPEAL OF THE REVENUE IS DISMISSED. CROSS OBJECTION NO. 17/CHANDI/2011 AY 2007-08 10. IN VIEW OF THE FINDINGS RECORDED ABOVE, THE CRO SS OBJECTION INTENDED TO SUPPORT THE APPELLATE ORDER IS DISMISSE D AS INFRUCTUOUS. 11. IN THE RESULT, BOTH THE APPEAL OF THE REVENUE A S ALSO THE CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON 26 .8.2011 SD/- SD/- (SUSHMA CHOWLA) (MEHAR SINGH) JUDICIAL MEMBER ACCOUNANT MEMBER CHANDIGARH, THE 26 .8.2011 SURESH COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR