SHRI RAKESH TIWARI, RAIPUR V. INCOME TAX OFFICER, WARD 3(3), RAIPUR

ITA 195/RPR/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4001 (ITAT-RAIPUR)
• Duration Of Justice: 1 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 16-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Procedural lapse
• Section: 195; 201; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI PARTHA SARATHI CHAUDHU RY , JM . / I TA NO. 195 /RPR /20 18 / ASSESSMENT YEAR : 2015 - 16 SHRI RAKESH TIWARI, LODHI PARA, KRISHI UPAJ MANDI ROAD, PANDRI TARAI, RAIPUR (C.G.) PIN - 492 001 PAN : ACXPT6237D ....... / APPELLANT / V/S. THE INCOME TAX OFFICER - 3(3), RAIPUR (C.G.) / RESPONDENT A SSESSEE BY : SHRI R.B. DOSHI REVENUE BY : SHRI SANJAY KUMAR / DATE OF HEARING : 08 . 11 .2019 / DATE OF PRONOUNCEMENT : 08 .11 .2019 / ORDER PER PARTHA SARATHI CHAUDHU RY, JM : THIS APPEAL PREFERRED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE LD.CIT(APPEALS) - 1, RAIPUR (C.G.) DATED 08.08.2018 FOR THE ASSESSMENT YEAR 2015 - 16 AS PER THE GROUNDS OF APPEAL ON RECORD. 2 ITA NO. 195 /RPR /20 18 A.Y. 2015 - 16 2. IN THIS CASE, THE ASSESSEE HAS FILED BOTH , LEGAL GROUND AS WELL AS GROUNDS ON MERITS. AT THE VERY OUTSET, THE LD. AR OF THE ASSESSEE SUBMITTED THAT IF THE LEGAL GROUNDS ARE ANSWERED IN FAVOUR OF THE ASSESSEE THEN THE GROUNDS ON MERITS WOULD BECOME ACA DEMIC IN NATURE. 3. THE LEGAL GROUND RAISED BY THE ASSESSEE IS THAT THERE WAS NO SERVICE OF NOTICE U/S.143(2) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) TO THE ASSESSEE BY THE JURISDICTIONAL ASSESSING OFFICER FRAMING ASSESSMENT OF THE ASSESSEE. IN THIS CASE, NOTICE U/S.143(2) WAS SERVED ON THE ASSESSEE BY THE ITO, WARD - 1(2), RAIPUR ON 29.09.2016. THIS FACT IS ENSHRINED WITHIN THE ASSESSMENT ORDER. IT IS THE CONTENTION OF THE LD. AR THAT THIS NOTICE U/S.143(2) DATED 29.09.2016 ISSU ED BY THE ITO, WARD - 1(2) ON THE ASSESSEE. HOWEVER, THE SAID ITO DID NOT HAVE ANY JURISDICTION ON THE ASSESSEE SINCE VIDE NOTIFICATION NO.1/2014 - 15 DATED 15.11.2014, THE JURISDICTION OF THE ASSESSEE WAS ALREADY TRANSFERRED TO ITO, WARD - 3(3), RAIPUR IN VIEW OF THE FOLLOWING PARA IN THE SAID NOTIFICATION: 3 ALL PERSONS BEING OTHER THAN COMPANIES DERIVING INCOME FROM SOURCES OTHER THAN INCOME FROM BUSINESS OR PROFESSION AND OTHER THAN THOSE ASSESSABLE BY DCIT/ACIT 3(1), RAIPUR AND RESIDING WITHIN THE TERRITOR IAL AREA BETWEEN DHAMTARI NARROW GAUGE TRACK AND VISHAKHAPATANAM BROAD GAUGE RAILWAY TRACK STARTING FROM RAIPUR RAIL WAY STATION UPTO THEIR INTERSECTION OF JEEWANBIMA MARG (PANDRI) COVERING RAMAN MANDIR WARD, TIMBER MARKET DEVENDRA NAGAR, PANDRI CLOTH MAR KET, FCI GODOWN. 3.1 THE LD. AR FURTHER SUBMITTED THAT THE ASSESSMENT, THEREAFTER, WAS COMPLETED BY THE ITO, WARD - 3(3) , RAIPUR BUT BEFORE COMPLETING 3 ITA NO. 195 /RPR /20 18 A.Y. 2015 - 16 ASSESSMENT, HE HAD NEVER ISSUED NOTICE U/S.143(2) OF THE ACT TO THE ASSESSEE. THE LD. AR VEHEMENTLY ARGUE D THAT NOTICE U/S.143(2) OF THE ACT WAS ISSUED FIRST BY THE ITO, WARD - 1(2), RAIPUR WHO DID NOT HAVE JURISDICTION FOR SUCH ISSUANCE IN THE YEAR 2016 SINCE IN THE YEAR 2014 ITSELF VIDE DEPARTMENTAL NOTIFICATION (SUPRA.), THE JURISDICTION GOT TRANSFERRED TO ITO, WARD - 3(3), RAIPUR AND THE ITO, WARD - 3(3) HAD ULTIMATELY COMPLETED THE ASSESSMENT WITHOUT ISSUING ANY NOTICE TO THE ASSESSEE U/S.143(2) OF THE ACT WHICH IS MANDATORY FOR HIM TO ISSUE THE SAID NOTICE AS ENSHRINED IN THE DECISION OF THE HONBLE APEX COUR T IN THE FOLLOWING CASES : (I) ACIT VS. HOTEL BLUEMOON (2010) 321 ITR 365(SC) (II) CIT VS. LAXMAN DAS KHANDELWAL (2019) 417 ITR 325 (SC) 3.2 THE LD. AR FURTHER SUBMITTED THAT IN THESE CASES MENTIONED ABOVE, THE HONBLE APEX COURT HAS OBSERVED THAT ISSUANCE OF NO TICE U/S.143(2) IS A MANDATORY REQUIREMENT AND NON - ISSUANCE OF SUCH NOTICE CAN NOT BE EQUATED AS A MERE MISTAKE WHICH CAN BE RECTIFIED LATER ON . IF THE MANDATORY NOTICE OF SECTION 143(2) OF THE ACT IS NOT ISSUED THEN IT CANNOT BE A MERE PROCEDURAL IRREGULARITY AND THE SAME IS NOT CURABLE. THIS WOULD MAKE THE ASSESSMENT ORDER VOID - AB - INITIO. 4. PER CONTRA, THE LD. DR CONTENDED THAT NOTICE U/S.143(2) WAS VALIDLY SERVED BY THE ITO, WARD - 1(2), RAIPUR AND ONCE SUCH NOTICE HAS BEEN SERVED THERE WAS NO RE QUIREMENT FOR SERVING ANOTHER NOTICE U/S.143(2) OF 4 ITA NO. 195 /RPR /20 18 A.Y. 2015 - 16 THE ACT BY THE ITO, WARD - 3(3), RAIPUR WHO HAS ULTIMATELY COMPLETED THE ASSESSMENT. HOWEVER, THE LD. DR DID NOT PROVIDE ANY SUBMISSION REGARDING DEPARTMENTAL NOTIFICATION (SUPRA.) BY WHICH ITSELF, THE ITO, WARD - 1(2), RAIPUR HAD LOST JURISDICTION OVER THE ASSESSEE IN THE YEAR 2016 WHEN HE HAD ISSUED THE NOTICE U/S.143(2) OF THE ACT TO THE ASSESSEE. THE LD. DR HOWEVER, STATED THAT THE CASES LAWS RELIED ON BY THE LD. AR ARE FACTUALLY DIFFERENT FROM THE CASE OF THE ASSESSEE. HOWEVER, THE LD. DR FAILED TO MENTION OR COMMENT ON THE FACT THAT ALL THESE DECISIONS PERTAINS TO THE FACT THAT NOTICE U/S.143(2) OF THE ACT IS MANDATORY AND HAS TO BE ISSUED BY THE ASSESSING OFFICER HAVING JURISDICTION TO THE ASSESSEE AND I F SUCH NOTICE U/S.143(2) IS NOT ISSUED THEN THE ENTIRE PROCEDURE FAILS. THESE AREAS WERE NOT COMMENTED UPON BY THE LD. DR. 5. WE HAVE PERUSED THE CASE RECORDS AND HEARD THE RIVAL CONTENTIONS. WE HAVE ALSO CONSIDERED THE JUDICIAL PRONOUNCEMENTS PLACED BEFO RE US. WE FIND THAT IN THIS CASE, AS PER ASSESSMENT ORDER, THE NOTICE U/S.143(2) OF THE ACT DATED 29.09.2016 WAS ISSUED AND SERVED ON THE ASSESSEE BY THE ITO, WARD - 1(2), RAIPUR. HOWEVER, AS PER THE DEPARTMENTAL NOTIFICATION NO.1/2014 - 15 DATED 15.11.2014, T HE JURISDICTION FROM THE ITO, WARD - 1(2), RAIPUR WAS TRANSFERRED TO ITO, WARD - 3(3), RAIPUR FOR THE REASONS MENTIONED IN THE CLAUSE IN SUCH NOTIFICATION WHICH ALREADY BEEN MADE PART OF THIS ORDER AS HEREINABOVE MENTIONED. THEREFORE, WHEN NOTICE U/S.143(2) OF THE ACT IN THE YEAR 2016 BY THE ITO, WARD - 1(2) WAS ISSUED 5 ITA NO. 195 /RPR /20 18 A.Y. 2015 - 16 AND SERVED ON THE ASSESSEE, HE DID NOT HAD JURISDICTION OVER THE ASSESSEE. THAT THEREAFTER, ASSESSMENT WAS COMPLETED BY THE ITO, WARD - 3(3), RAIPUR SINCE THE JURISDICTION NOW WAS PASSED ON HIM. THO UGH THE ITO, WARD - 3(3) HAD COMPLETED THE ASSESSMENT OF THE ASSESSEE VIDE ORDER DATED 27.10.2017, HE HAS NOT ISSUED ANY NOTICE U/S.143(2) OF THE ACT TO THE ASSESSEE WHICH IS MANDATORY REQUIREMENT. THIS FACT IS UNDISPUTED AND ADMITTED BEFORE US AT THE TIME O F HEARING BY THE LD. DR. 6. WE TAKE GUIDANCE FROM THE BINDING DECISIONS OF THE HONBLE APEX COURT IN THE CASE OF ACIT VS. HOTEL BLUEMOON (2010) 321 ITR 365(SC) AND CIT VS. LAXMAN DAS KHANDELWAL (2019) 417 ITR 325 (SC) WHEREIN IT HAS BEEN CATEGORICALLY MENTIONED THAT THE ASSESSING OFFICER HAVING JURISDICTIO N OVER THE ASSESSEE ONLY HA S THE POWER TO ISSUE NOTICE U/S.143(2) OF THE ACT TO THE ASSESSEE WHICH IS MANDATORY REQUIREMENT. IF SUCH NOTICE IS NOT BEING ISSUED THEN IT CANNOT BE A MERE PROCEDURAL IRREGULARITY AND THE SAME IS NOT CURABLE. 7. REVERTING TO THE FACT OF THE PRESENT CASE, IT IS ABSOLUTELY CRYSTAL CLEAR AND AS THE FACTS REMAINS UNDISPUTED THAT THE 143(2) NOTICE ISSUED TO THE ASSESSEE BY THE ITO, WARD - 1(2), RAIPUR WHO DID NOT HAVE ANY JURISDICTION OVER THE ASSESSEE. THEREAFTER, WHEN THE JURISDICTION WAS TRANSFERRED TO THE ITO, WARD - 3(3), RAIPUR WHO COMPLETED THE ASSESSMENT, HAS NEVER ISSUED ANY NOTICE U/S.143(2) OF THE ACT TO THE ASSESSEE. AS WE HAVE ALREADY 6 ITA NO. 195 /RPR /20 18 A.Y. 2015 - 16 EXAMINED IN THE PRECEDING PARAGRAPHS, AS PER THE DIRECTIONS OF THE HONBLE APEX COURT, ISSUANCE OF NOTICE U/S.143(2) OF THE ACT IS MANDATORY REQUIREMENT BEFORE COMPLETION OF THE ASSESSMENT PROCEEDINGS AND WHEN SUCH PROCEDURE WAS NOT COMPLIED WITH BY THE ASSESSING OFFICER THAT WOULD MAKE THE ASSESSMENT ORDER VOID - AB - INITIO. WE ORD ER ACCORDINGLY. 8. THE ASSESSEE THEREFORE SUCCEEDS IN THIS LEGAL GROUND AND THEREFORE, OTHER GROUNDS ON MERITS BECOME ACADEMIC IN NATURE. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRO NOUNCED ON 08 TH DAY OF NOVEMBER , 201 9 . SD/ - SD/ - ANIL CHATURVEDI PARTHA SARATHI CHAUDHURY ACCOUNTANT MEMBER JUDICIAL MEMBER / RAIPUR ; / DATED : 08 TH NOVEMBER , 2019 . SB / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(A) - 1, RAIPUR 4. THE PR. CIT - 1, RAIPUR (C.G.) 5. , , , / DR, ITAT, RAIPUR BENCH, RAIPUR . 6. / GUARD FILE. // TRUE COPY // / BY ORDER, / PRIVATE SECRETARY , / ITAT, RAIPUR . 7 ITA NO. 195 /RPR /20 18 A.Y. 2015 - 16 DATE 1 DRAFT DICTATED ON 08.11 .2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 08 . 11 .201 9 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER