Sh. Anil Gupta, Jammu V. The Income-tax Officer, Jammu

ITA 370/ASR/2012

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9646 (ITAT-AMRITSAR)
• Duration Of Justice: 3 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 02-08-2018
• Assessment Year: 2005-2006
• Appeal Filed On: 19-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S KANWAL
• Assessee Lawyers: P N ARORA
• Keywords: Non compliance; Procedural lapse; Assessment record; Block assessment; Reason to believe
• Section: 143(3); 142(1); 139(5); 147; 131; 148; 144; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A NOS.369 & 370(ASR)/2012 ASSESSMENT YEARS: 2004-05 & 2005-06 SH. ANIL KUMAR PROP. SHIVA STEEL INDUSTRIES, GANGYAL, JAMMU. PAN:AGAPG 0354K VS. INCOME TAX OFFICER, WARD-1(1), JAMMU. (APPELLANT) (RESPONDENT) I.T.A NOS.374 & 375(A SR)/2012 ASSESSMENT YEARS: 2004- 05 & 2005-06 INCOME TAX OFFICER, WARD-1(1), JAMMU. VS. ANIL KUMAR PROP. SHIVA STEEL INDUSTRIES, GANGYAL, JAMMU. PAN:AGAPG 0354K (APPELLANT) (RESPONDENT) APPELLANT BY: SH. P.N. ARORA (ADV.) RESPONDENT BY: SH. S.S KANWAL (DR) DATE OF HEARING: 12.07.2016 DATE OF PRONOUNCEMEN T: 01.08.2016 ORDER PER T. S. KAPOOR (AM): THESE ARE CROSS APPEALS FILED BY ASSESSEE AS WELL AS BY REVENUE AGAINST THE CONSOLIDATED ORDER OF LEARNED CIT(A), JAMMU, DA TED 09.07.2012 FOR ASST. YEARS: 2004-05 & 2005-06. 2. THESE APPEALS WERE EARLIER DISMISSED FOR NON PRO SECUTION VIDE TRIBUNAL ORDER DATED 3 RD DEC. 2013, HOWEVER, A MISCELLANEOUS APPLICATION WA S FILED BY I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 2 ASSESSEE, AND THE SAID ORDER WAS RECALLED AND THE A PPEALS WERE FIXED FOR HEARING ON MERITS. 3. AT THE OUTSET, THE LEARNED AR INVITED OUR AT TENTION TO AN ADDITIONAL GROUND OF APPEALS RAISED VIDE LETTER DATED 23.05.2016. THE LEARNED AR SUBMITTED THAT THE NOTICE U/S 143(2) WAS NOT SERVED UPON THE ASSES SEE, THEREFORE, THE ASSESSMENT ORDERS WERE ILLEGAL AND VOID AB INITIO T HEREFORE, THESE MAY BE QUASHED. THE LEARNED AR SUBMITTED THAT THIS BEING A LEGAL ISSUE, THE ASSESSEE WAS ENTITLED TO RAISE THE ISSUE AT THIS FORUM. IT W AS ALSO SUBMITTED THAT IN EARLIER HEARING THE HONBLE BENCH HAD DIRECTED TO LEARNED D R TO PRODUCE ASSESSMENT RECORDS TO VERIFY THE CONTENTION OF ASSESSEE. 4. THE LEARNED DR, HOWEVER, HAD FILED APPLICATION F OR ADJOURNMENT OF CASES BUT ADMITTED THAT ASSESSMENT ORDERS WERE AVAILABLE WITH HIM. WE FOUND THAT SINCE THE ASSESSEE HAD RAISED A JURISDICTIONAL ISSU E WHICH FACT WAS VERIFIABLE FROM THE ASSESSMENT RECORDS AVAILABLE WITH LEARNED DR, THEREFORE, WE PROCEEDED TO HEAR THE CASES AND ADJOURNMENT APPLICATION WAS R EJECTED AND ADDITIONAL GROUND OF APPEAL WAS ADMITTED. 5. THE LEARNED DR, AFTER GOING THROUGH THE ASSESSME NT RECORDS COULD NOT FIND THE SERVICE OF NOTICE U/S 143(2) OF THE ACT, BUT HE SUBMITTED THAT NOTICES U/S 143(2) IN THESE CASES WAS NOT REQUIRED TO BE ISSUED AND SERVED AS THE ASSESSEE HAD FILED RETURNS OF INCOME U/S 148 ON 29 TH DEC.2008 AND ASSESSMENTS WERE GOING TO BE TIME BARRED BY 31 ST DEC. 2008 AND THEREFORE, THERE WAS NO OCCASION AVAILABLE WITH THE ASSESSING OFFICER TO ISSUE NOTIC ES U/S 143(2) OF THE ACT. HE SUBMITTED THAT ASSESSEE DELIBERATELY KEPT ON DELAYI NG THE FILING OF RETURNS IN I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 3 RESPONSE TO NOTICE U/S 148 AND THEREFORE, THESE RET URNS ARE NOT VALID RETURNS. THE LEARNED DR SUBMITTED THAT SINCE IN THESE CASES HIS APPLICATION FOR ADJOURNMENT HAS BEEN REJECTED, THEREFORE, HE MAY BE PERMITTED TO FILE WRITTEN SUBMISSIONS IN THIS REGARD. AFTER HEARING THE LEARN ED DR WE DEEMED IT APPROPRIATE TO PERMIT HIM TO FILE WRITTEN SUBMISSIO NS IN RESPECT OF ADDITIONAL GROUND OF APPEAL FOR NON SERVICE OF NOTICE. THE LEA RNED DR AFTER A FEW DAYS FILED WRITTEN SUBMISSIONS. 6. THE LEARNED AR, ON THE OTHER HAND, SUBMITTED THA T SERVICE OF NOTICE 143(2) IS A NECESSARY REQUIREMENT FOR ASSUMING JURISDICTIO N FOR PASSING ORDER U/S 143(3) AS HAS BEEN HELD IN A NUMBER OF CASES. THE L EARNED AR IN THIS RESPECT RELIED UPON THE CASE LAW OF HONBLE SUPREME COURT I N THE CASE OF ACIT VS. HOTEL BLUE MOON, 321 ITR 0362 (SC) . THE LEARNED AR FURTHER RELIED ON THE CASE LAW DECIDED BY HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT-2, VS. SALAPUR COLD STORAGE (P) LTD., 50 TAXMAN.COM 105 . FURTHER RELIANCE WAS PLACED ON THE CASE LAW OF HONBLE DELHI HIGH COURT IN THE CASE OF DIRECTOR OF INCOME TAX VS. SOCIETY FOR WORLDWIDE INTERBANK FINANCIAL TELE COMMUNICATIONS, REPORTED IN 323 ITR 249 . IN VIEW OF THESE JUDGMENTS, THE LEARNED AR ARGUED THAT THE CASES OF THE ASSESSEE ARE SQUARELY COVERED BY THESE JUDGMENTS AND THEREFO RE, ASSESSMENT PASSED IN THESES CASES ARE VOID AB INITIO AND ARE BOUND TO BE QUASHED. AS REGARDS THE ARGUMENTS OF LEARNED DR THAT THE RETURNS FILED BY A SSESSEE WERE INVALID, THE LEARNED AR SUBMITTED THAT NOWHERE IN THE ASSESSMENT ORDER THE ASSESSING OFFICER HAS HELD THE RETURNS TO BE INVALID AND RATH ER HE HAD NOTED DOWN THE ORDER SHEET ENTRIES IN THE ORDER SHEET PLACED AT (P B PAGE-28 TO 30) I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 4 7. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD AND HAVE ALSO GONE THROUGH THE WRITTEN SU BMISSIONS FILED BY LEARNED DR. FOR THE SAKE OF CONVENIENCE THE WRITTEN SUBMISS IONS FILED BY LEARNED DR ARE MADE PART OF THIS ORDER AND ARE REPRODUCED AS UNDER : WRITTEN SUBMISSIONS ON THE GROUND OF APPEAL OF THE ASSESSEE REGARDING NONSERVICE OF NOTICE U/S 143(2) OF THE INCOME-TAX A CT,1961 AS PER DIRECTIONS OF THE HONBLE ITAT, AMRITSAR BEN CH, AMRITSAR GIVEN DURING THE COURSE OF HEARING OF THE CASE ON 12.07.2016, FOLLOW ING WRITTEN SUBMISSIONS IN THE CASE ARE MADE WITHOUT PREJUDICE TO MY APPLICATION S EEKING ADJOURNMENT IN THE CASE UNDER REFERENCE FILED BEFORE THE HONBLE TRIBU NAL: 1. INFORMATION WAS RECEIVED THAT THE ASSESSEE HAD M ADE CERTAIN SUPPLIES TO THE ARMY AUTHORITIES THROUGH NATIONAL COOPERATIVE CONSU MER FEDERATION OF INDIA LIMITED, JAMMU IN VIOLATION OF CENTRAL EXCISE RULES . AFTER THE RECEIPT OF INFORMATION AND AFTER CONDUCTING FURTHER ENQUIRIES, A SURVEY ON THE BUSINESS PREMISES OF THE ASSESSEE SHRI ANIL GUPTA WAS CARRIE D OUT ON 25.03.2008 U/S 133 A OF THE IT ACT, 1961. THE OFFICE OF THE CA OF THE ASSESSEE WAS ALSO COVERED AND ASSESSMENT RECORD OF THE ASSESSEE WAS GATHERED FROM HIS OFFICE. THE MANAGER OF NCCF WAS ISSUED A SUMMON U/S 131 OF THE IT ACT, 196 1 AND ALL THE RECORDS OF THE ASSESSEE TRANSACTIONS MADE WITH ARMY THROUGH NC CF WERE IMPOUNDED. 2. AFTER GOING THROUGH ALL THE DOCUMENTS FOUND FROM NC CF AND AFTER RECORDING STATEMENT OF THE ASSESSEE WHEREIN HE ADMI TTED THAT HE WAS INVOLVED IN ALL THESE TRANSACTIONS WHICH HAD BEEN DETECTED BY T HE DEPARTMENT, THE RETURN FILED BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2004 -05 & 2005-06 WERE EXAMINED. THE ASSESSMENT RECORD OF THE ASSESSEE REV EALED THAT HE HAD NOT DISCLOSED THESE TRANSACTIONS IN HIS RETURN OF INCOM E FOR THE ASSESSMENT YEARS 2004-05 & 2005-06. ACCORDINGLY, THE CASES OF THE AS SESSEE FOR THE ASSESSMENT YEAR 2004-05 AND 2005-06 WERE REOPENED U/S 147 OF T HE ACT. 3. NOTICES U/S 148 OF THE IT ACT, 1961 WERE ISSUED TO THE ASSESSEE FOR THE ASSESSMENT YEARS 2004-05 AND 2005-06 ON 31.03.2008, ASKING THE ASSESSEE TO FILE RETURN OF INCOME FOR THE ASSESSMENT YEARS 2004 -05 & 2005-06 WITHIN 15 DAYS FROM THE DATE OF RECEIPT OF THE NOTICES. 4. VIDE APPLICATION DATED 15.04.2008, THE ASSESSEE SO UGHT EXTENSION OF TIME OF 15 DAYS FOR FILING THE RETURNS UNDER REFERENCE. HOWEVER, THE ASSESSEE FAILED TO FILE THE RETURNS EVEN WITHIN THE EXTENDED TIME AND AGAIN FILED LETTER DATED 30.04.2008, SEEKING FURTHER EXTENSION OF 15 DAYS FO R FILING THE RETURN. AGAIN THE ASSESSEE FAILED TO FILE RETURN WITHIN THE EXTENDED PERIOD. 5. THEREAFTER, NOTICE U/S 142(1) OF THE IT ACT,1961 W AS ISSUED TO THE ASSESSEE ON 09.09.2008 ALONGWITH COVERING LETTER PO INTING OUT THE NON- COMPLIANCE ON THE PART OF THE ASSESSEE IN FILING RE TURN OF INCOME. THE ASSESSEE AGAIN FAILED TO COMPLY WITH THE NOTICE AS WELL AS T HE LETTER. I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 5 6. ANOTHER LETTER DATED 17.10.2008 IN CONNECTION WITH THE PROCEEDINGS UNDER REFERENCE WAS ISSUED TO THE ASSESSEE WHICH ALSO WAS NOT COMPLIED WITH BY THE ASSESSEE. 7. SUBSEQUENTLY, SHOW CAUSE LETTER WAS ISSUED TO THE ASSESSEE ON 23.12.2008 GIVING THE ASSESSEE FINAL OPPORTUNITY TO FURNISH THE INFORMATION DESIRED BY THE ASSESSING OFFICER ON OR BEFORE 29.12 .2008. VIDE LETTER DATED 29.12.2008, THE ASSESSEE INTIMATED THAT HE HAD FILE D RETURN ON 29.12.2008. 8. ASSESSMENT ORDER WAS PASSED BY THE ASSESSING OFFICE R ON 30.12.2008 U/S 144 READ WITH SECTION 147 OF THE IT ACT. 9. FROM THE SEQUENCE OF EVENTS MENTIONED ABOVE, IT IS CLEAR THAT THE ASSESSEE DELIBERATELY KEPT ON DELAYING THE FILING OF RETURN IN RESPONSE TO NOTICE U/S 148 DATED 31.03.2008 OF THE ACT TILL 29.12.2008. 10. THE RETURNS FILED BY THE ASSESSEE FOR THE ASSESSME NT YEARS 2004-05 & 2005-06 WERE NONEST & INVALID RETURNS SINCE THESE W ERE FILED MUCH BEYOND THE TIME PERIOD ALLOWED TO THE ASSESSEE FROM TIME TO TI ME AS PER NOTICE U/S 148 OF THE ACT. THEREFORE, NO NOTICE U/S 143(2) OF THE ACT WAS REQUIRED TO BE ISSUED FOR THE ASSESSMENT YEARS 2004-05 & 2005-06. THUS, THE ADDIT IONAL GROUND OF APPEAL RAISED BY THE ASSESSEE DESERVES TO BE DISMISSED SIN CE IT IS DEVOID OF ANY LEGAL MERIT. 11. PROVISIONS OF SECTION 143(2) OF THE IT ACT, 1961 AR E RE-PRODUCED HEREUNDER: WHERE A RETURN HAS BEEN FURNISHED UNDER SECTION 13 9, OR IN RESPONSE TO A NOTICE UNDER SUB-SECTION (1) OF SECTION 142, THE ASSESSING OFFICER SHALL, - WHERE HE HAS REASON TO BELIEVE THAT ANY CLAIM OF LO SS, EXEMPTION, DEDUCTION, ALLOWANCE OR RELIEF MADE IN THE RETURN IS INADMISSIBLE, SERVE ON THE ASSESSEE A NOTICE SPECIFYING PARTICULARS OF SUCH CLAIM OF LOSS, EXEMPTION, DEDUC TION, ALLOWANCE OR RELIEF AND REQUIRE HIM ON A DATE TO BE SPECIFIED THEREIN TO PRODUCE OR CAU SE TO BE PRODUCED ANY EVIDENCE OR PARTICULARS SPECIFIED THEREIN OR ON WHICH THE ASSES SEE MAY RELY, IN SUPPORT OF SUCH CLAIM: PROVIDED THAT NO NOTICE UNDER THIS CLAUSE SHALL BE SERVED ON THE ASSESSEE ON OR AFTER THE 1ST DAY OF JUNE, 2003 (II) NOTWITHSTANDING ANYTHING CONTAINED IN CLAUSE ( I) IF HE CONSIDERS IT NECESSARY OR EXPEDIENT TO ENSURE THAT THE ASSESSEE HAS NOT UNDER STATED TH E INCOME OR HAS NOT COMPUTED EXCESSIVE LOSS OR HAS NOT UNDER PAID THE TAX IN ANY MANNER, S ERVE ON THE ASSESSEE A NOTICE REQUIRING HIM ON A DATE TO BE SPECIFIED THEREIN EITHER TO ATT END HIS OFFICE OR TO PRODUCE OR CAUSE TO BE PRODUCED ANY EVIDENCE ON WHICH THE ASSESSEE MAY REL Y IN SUPPORT OF THE RETURN: PROVIDED THAT NO NOTICE UNDER CLAUSE (II) SHALL BE SERVED ON THE ASSESSEE AFTER THE EXPIRY OF SIX MONTHS FROM THE END OF THE FINANCIAL YEAR IN WH ICH THE RETURN IS FURNISHED 12. AS PER SECTION 139(4) & 139(5) OF THE IT ACT, 1961, THE ASSESSEE CAN FILE A RETURN OF INCOME OR REVISE A RETURN FOR ANY ASSESSM ENT YEAR WITHIN ONE YEAR FROM THE END OF THE RELEVANT ASSESSMENT YEAR OR DATE OF COMPLETION OF ASSESSMENT, I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 6 WHICHEVER IS EARLIER. THUS, THE NORMAL TIME FOR FIL ING RETURN OF INCOME FOR THE ASSESSMENT YEAR 2004-05 & 2005-06 WAS UP TO 31.03.2 006 AND 31.03.2007 RESPECTIVELY. FURTHER, AS PER THE PROVISIONS OF SEC TION 148 OF THE IT ACT,1961, ANY RETURN FILED WITHIN THE PERIOD MENTIONED IN SECTION 148 OF THE ACT ISSUED BY THE ASSESSING OFFICER IS DEEMED TO BE A RETURN REQUIRED TO BE FURNISHED U/S 139 OF THE ACT. THUS, IN THIS CASE, HAD THE ASSESSEE FURNI SHED THE RETURN OF INCOME FOR THE ASSESSMENT YEARS 2004-05 & 2005-06 WITHIN THE P ERIOD OF 15 DAYS MENTIONED IN NOTICE U/S 148 ISSUED ON 31.03.2008 OR EVEN WITH IN THE FURTHER PERIOD OF ONE MONTH FOR WHICH EXTENSION WAS SOUGHT BY THE ASSESSE E, THE RETURN WOULD HAVE BEEN DEEMED TO BE VALID RETURN FILED U/S 139 OF THE ACT. HOWEVER, THE ASSESSEE FAILED TO DO SO. THEREFORE, THE RETURN OF INCOME FI LED BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2004-05 & 2005-06 ON 29.12.2008 IS A NON EST AND INVALID RETURN I.E. THIS IS NO RETURN IN THE EYES OF LAW. T HEREFORE, THE AO WAS UNDER NO LEGAL OBLIGATION TO ISSUE NOTICE U/S 143(2) OF THE IT ACT, 1961 FOR THE ASSESSMENT YEARS 2004-05 & 2005-06 IN THIS CASE. PROVISIONS OF SECTION 148 OF THE ACT ARE RE- PRODUCED BELOW:- BEFORE MAKING THE ASSESSMENT, REASSESSMENT OR RECO MPUTATION UNDER SECTION 147, THE ASSESSING OFFICER SHALL SERVE ON THE ASSESSEE A NOTI CE REQUIRING HIM TO FURNISH WITHIN SUCH PERIOD, AS MAY BE SPECIFIED IN THE NOTICE A RETURN OF HIS INCOME OR THE INCOME OF ANY OTHER PERSON IN RESPECT OF WHICH IS ASSESSABLE UNDER THIS ACT DURING THE PREVIOUS YEAR CORRESPONDING TO THE RELEVANT ASSESSMENT YEAR, IN T HE PRESCRIBED FORM AND VERIFIED IN THE PRESCRIBED MANNER AND SETTING FORTH SUCH OTHER PART ICULARS AS MAY BE PRESCRIBED AND THE PROVISIONS OF THIS ACT SHALL SO FAR AS MAY BE APPLY ACCORDINGLY AS IF SUCH RETURN WERE A RETURN REQUIRED TO BE FURNISHED UNDER SECTION 139. 13. WITHOUT PREJUDICE TO THE LEGAL POSITION MENTIO NED ABOVE, EVEN IF THE RETURN FILED BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2004 -05 & 2005-06 ON 29.12.2008 IS TREATED AS FILED IN RESPONSE TO NOTICE ISSUED U/ S 148 ON 31.03.2008, THERE WAS NO TIME AVAILABLE WITH THE AO TO SERVE A NOTICE U/S 143(2) OF THE ACT UPON THE ASSESSEE SINCE THE ASSESSMENT PROCEEDINGS WERE GOIN G TO BECOME BARRED BY TIME LIMITATION ON 31.12.2008. IT IS ABUNDANTLY CLEAR TH AT THE ASSESSEE KEPT ON ADOPTING NON-COOPERATIVE ATTITUDE FOR A LONG PERIOD BETWEEN SINCE THE DATE OF ISSUE OF NOTICE U/S 148 ON 31.03.2008 AND FILED THE RETURN ONLY ON 29.1 2.2008 I.E. ONLY TWO DAYS BEFORE THE TIME BARRING DATE OF THE CASE. ACT OF THE ASSESSEE IN FILING THE RETURN JUST 2 DAYS BEFORE THE TIME BARRING DATE IS NOTHING BUT A PURE MISCHIEF TO THWART THE ATTEMPT OF THE DEPARTMENT TO BRING TO TAX CONCEALED INCOME IN THIS CASE. 14. IN VIEW OF THE LEGAL AND FACTUAL MATRIX OF THE CASE MENTIONED ABOVE, IT IS PRAYED THAT ADDITIONAL GROUND OF APPEAL TAKEN BY THE ASSESSEE R EGARDING NON-SERVICE OF NOTICE U/S 143(2) OF THE IT ACT, 1961 MAY KINDLY BE DISMISSED. IN CASE THE HONBLE TRIBUNAL DOES NOT AGREE WITH THE LEGAL VIEW OF THE DEPARTMENT MENTION ED ABOVE, A FRESH OPPORTUNITY OF HEARING AS PRAYED IN THE APPLICATION FILED FOR ADJO URNMENT DATED 12.07.2016 OF THE CASE MAY BE GIVEN TO THE DEPARTMENT IN THE INTEREST OF J USTICE. FROM THE WRITTEN ARGUMENTS FILED BY LEARNED DR, WE FIND THAT HE HAS RAISED THE ISSUE THAT THE RETURNS OF INCOME FILED BY THE ASSES SEE WERE NONEST AND INVALID I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 7 RETURNS SINCE THESE WERE FILED MUCH AFTER THE TIME WHEN THE ASSESSEE WAS REQUIRED TO FILE IN VIEW OF NOTICE U/S 148 OF THE A CT. IN HIS WRITTEN ARGUMENTS, THE LEARNED DR HAS INVITED OUR ATTENTION TO THE FACT TH AT THE CASES OF THE ASSESSEE WERE REOPENED U/S 148 AND ASSESSEE WAS REQUIRED FIL E RETURNS OF INCOME WITHIN 15 DAYS. VIDE APPLICATION DATED 15.04.2008 HE SOUGH T TIME TO FILE THE RETURNS BUT AGAIN DID NOT FILE THE RETURNS AND FURTHER SOU GHT EXTENSION ON 30.04.2008 AND AGAIN WITHIN THE EXTENDED TIME THE ASSESSEE DID NOT FILE ANY RETURN. IT WAS SUBMITTED IN THE WRITTEN SUBMISSIONS THAT A NOTICE U/S 142(1) WAS ISSUED TO ASSESSEE ON 9.9.2008 AND ASSESSEE WAS POINTED OUT R EGARDING NON COMPLIANCE IN FILING RETURNS OF INCOME AGAINST WHICH ASSESSEE AGA IN FAILED TO FILE THE SAME. ANOTHER LETTER DATED 17.10.2008 WAS ISSUED TO THE A SSESSEE WHICH ALSO REMAINED UNCOMPLIED. SUBSEQUENTLY, SHOW CAUSE LETTER WAS ISS UED TO THE ASSESSEE ON 23.12.2008 GIVING FINAL OPPORTUNITY TO FURNISH THE REQUIRED INFORMATION DESIRED BY ASSESSING OFFICER ON OR BEFORE 29.12.2008 AND VI DE LETTER DATED 29.12.2008 THE ASSESSEE INTIMATED THAT HE HAD FILED RETURNS O N 29.12.2008. THE CRUX OF ARGUMENTS OF LEARNED DR IS THAT ASSESSEE DELIBERATE LY KEPT ON POSTPONING THE FILING OF RETURNS TILL 29.12.2008 AS HE KNEW THAT A SSESSMENTS WERE BECOMING TIME BARRED BY 31 ST DEC. 2008 AND THEREFORE, ONLY TWO DAYS WERE LEFT F OR COMPLETION OF ASSESSMENT. IN VIEW OF THESE FACTS AN D CIRCUMSTANCES, THE LEARNED DR HAS PRAYED THAT THE ADDITIONAL GROUND OF APPEAL TAKEN BY ASSESSEE REGARDING NON SERVICE OF NOTICE U/S 143(2) BE DISMISSED, AS F IRST OF ALL THE RETURNS FILED BY ASSESSEE WERE NOT VALID RETURNS AND SECONDLY THERE WAS NO TIME AVAILABLE WITH THE ASSESSING OFFICER TO ISSUE NOTICES U/S 143(2) OF THE ACT. I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 8 8. ON THE OTHER HAND, LEARNED AR HAD MAINTAINED THA T RETURNS WERE FILED IN VIEW OF NOTICE U/S 148 AND ASSESSING OFFICER HAD TA KEN COGNIZANCE OF THE RETURNS FILED BY ASSESSEE AND HAS NOTED DOWN THE PROCEEDING S IN THE ORDER SHEET AND IN THIS RESPECT OUR ATTENTION WAS INVITED TO COPY OF O RDER SHEET PLACED AT (PB PAGE 28 TO 30) AND IN VIEW OF THIS FACT IT WAS SUBMITTED THAT THE ASSESSING OFFICER HIMSELF HAD ACCEPTED THE RETURNS AND THEREFORE, THE ARGUMENTS OF LEARNED DR THAT THE RETURNS WERE NOT VALID DO NOT HOLD ANY FOR CE. 9. TO ADJUDICATE ON THE ISSUE IN THE ABOVE CASES IT IS NECESSARY TO VISIT THE RELEVANT SECTIONS AS CONTAINED IN SECTION 148 OF TH E ACT WHICH READS AS UNDER: 148. [(1)] BEFORE MAKING THE ASSESSMENT, REASSESSM ENT OR RECOMPUTATION NOTICE REQUIRING HIM TO FURNISH WITHIN SUCH PERIOD.,[***] AS MAY BE SPECIFIED IN THE NOTICE, A RETURN OF HIS INCOME OR THE INCOME OF ANY OTHER PERSONS IN RESPECT OF WHICH HE IS ASSESSABLE UNDER THIS ACT DURING THE PR EVIOUS YEAR CORRESPONDING TO THE RELEVANT ASSESSMENT YEAR, IN THE PRESCRIBED FOR M AND VERIFIED IN THE PRESCRIBED MANNER AND SETTING FORTH SUCH OTHER PART ICULARS AS MAY BE PRESCRIBED; AND THE PROVISIONS OF THIS ACT SHALL, SO FAR AS MAY BE, APPLY ACCORDINGLY AS IF SUCH RETURN WERE A RETURN REQUIRED TO BE FURNISHED UNDER SECTION 139:] [PROVIDED*****] [PROVIDED FURTHER*****] [EXPLANATION.-FOR THE REMOVAL OF DOUBTS, IT IS HERE BY DECLARED THAT NOTHING CONTAINED IN THE FIRST PROVISO OR THE SECOND PROVIS O SHALL APPLY TO ANY RETURN WHICH HAS BEEN FURNISHED ON OR AFTER THE 1 ST DAY OF OCTOBER,2005 IN RESPONSE TO A NOTICE SERVED UNDER THIS SECTION.] [(2) THE ASSESSING OFFICER SHALL, BEFORE ISSUING AN Y NOTICE UNDER THIS SECTION, RECORD HIS REASONS FOR DOING SO.] FROM THE ABOVE PROVISIONS OF SECTION 148 READ WITH PROVISO AND EXPLANATION, WE FIND THAT PROVISOS CONTAINED IN SEC.148 ARE NOT APP LICABLE TO THE ASSESSEE AS THE PROVISOS RELATE TO THE PERIOD OF RETURNS FILED BEFO RE 30 TH SEP. 2005 WHEREAS IN THE PRESENT CASE THE RETURNS HAS BEEN FILED IN THE YEAR 2008. THE MAIN PROVISION OF SECTION 148 DOES NOT PROVIDE ANY TIME LIMIT FOR FIL ING OF RETURNS, BUT STATES THAT I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 9 RETURNS ARE TO BE FILED WITHIN SUCH PERIOD AS MAY B E SPECIFIED IN THE NOTICE. IT FURTHER STATES THAT FOR RETURNS FILED U/S 148 ALL T HE PROVISIONS OF SEC.139 SO FAR AS MAY APPLY, WILL BE APPLICABLE. THE RELEVANT APPL ICABLE SUB-SECTION OF SEC.139 IS SEC. 139(9) WHICH DEALS WITH THE DEFECTIVE RETUR NS AND INVALID RETURNS. FOR THE SAKE OF CONVENIENCE THE PROVISIONS OF SEC.139(9) AR E REPRODUCED BELOW. [ 139(9) WHERE THE [ASSESSING] OFFICER CONSIDERS THAT THE R ETURNS OF INCOME FURNISHED BY THE ASSESSEE IS DEFECTIVE, HE MAY INTI MATE THE DEFECT TO THE ASSESSEE AND GIVE HIM AN OPPORTUNITY TO RECTIFY THE DEFECT W ITHIN A PERIOD OF FIFTEEN DAYS FROM THE DATE OF SUCH INTIMATION OR WITHIN SUCH FUR THER PERIOD WHICH, ON AN APPLICATION MADE IN THIS BEHALF, THE [ASSESSING] OF FICER MAY, IN HIS DISCRETION, ALLOW; AND IF THE DEFECT IS NOT RECTIFIED WITHIN TH E SAID PERIOD OF FIFTEEN DAYS OR, AS THE CASE MAY BE, THE FURTHER PERIOD SO ALLOWED, THE N, NOTWITHSTANDING ANYTHING CONTAINED IN ANY OTHER PROVISIONS OF THIS ACT, THE RETURN SHALL BE TREATED AS AN INVALID RETURN AND THE PROVISIONS OF THIS ACT SHALL APPLY AS IF THE ASSESSEE HAD FAILED TO FURNISH THE RETURN: PROVIDED THAT WHERE THE ASSESSEE RECTIFIES THE DEFECT AFTER THE EXPIRY OF THE SAID PERIOD OF FIFTEEN DAYS OR THE FURTHER PERIOD ALLOWE D, BUT BEFORE THE ASSESSMENT IS MADE, THE [ASSESSING] OFFICER MAY CONDONE THE DELAY AND TREAT THE RETURN AS A VALID RETURN. IN THE PRESENT CASES THE ASSESSING OFFICER DID NOT FIND ANY DEFECT IN THE RETURNS OF INCOME FILED BY ASSESSEE AND THEREFORE, THESE RE TURNS CANNOT BE TREATED AS INVALID RETURNS. THE ARGUMENTS OF LEARNED DR, THAT THESE RETURNS WERE INVALID RETURNS DO NOT HOLD ANY FORCE IN VIEW OF THE ABOVE PROVISIONS OF SEC.139(9) AND ALSO IN VIEW OF THE FACT THAT ASSESSING OFFICER IN VIEW OF RETURNS FILED BY ASSESSEE CARRIED OUT ASSESSMENT PROCEEDINGS ON 29.12.2008 & 30.12.2008 AND PASSED THE ORDER ON 30.12.2008 AFTER HEARING THE COUNSEL O F ASSESSEE. FOR THE SAKE OF CONVENIENCE THE SCANNED COPY OF ORDER SHEET HAS BEE N MADE PART OF THIS ORDER. I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 10 I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 11 I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 12 I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 13 THE ENTRIES IN THE ORDER SHEET INDICATE THAT ASSESS ING OFFICER ON THE BASIS OF RETURNS FILED BY ASSESSEE ON 29.12.2008 REQUIRED TH E ASSESSEE TO FURNISH CERTAIN INFORMATION AND AFTER OBTAINING INFORMATION THE COU NSEL OF THE ASSESSEE AGAIN APPEARED ON 30.12.2008. THE REPLIES OF THE ASSESSEE IN THE FORM OF TWO LETTERS BOTH DATED 30.12.2008 ARE PLACED AT (PB PAGE-4 TO 6 ). THE ASSESSING OFFICER AFTER CONSIDERING THE REPLIES OF THE ASSESSEE HAS PASSED THE ORDER ON 30.12.2008. IN VIEW OF THESE FACTS AND CIRCUMSTANCES THE PLEA OF T HE LEARNED DR THAT THE RETURNS FILED BY ASSESSEE WERE INVALID RETURNS DO NOT HOLD ANY FORCE AND THIS ARGUMENT IS REJECTED. 11. AS REGARDS THE ARGUMENTS OF LEARNED DR THAT THE TIME AVAILABLE FOR COMPLETION OF ASSESSMENT WAS NOT SUFFICIENT AND THE REFORE, NOTICE WAS NOT REQUIRED TO BE ISSUED U/S 143(2) ALSO DO NOT HOLD A NY FORCE IN VIEW OF THE FACT THAT ON 29.12.2008 ITSELF THE ASSESSING OFFICER COU LD HAVE SERVED THE NOTICE U/S 143(2) ON THE COUNSEL OF ASSESSEE WHICH WOULD HAVE BEEN SUFFICIENT COMPLIANCE OF THE PROVISIONS. AS PER ORDER SHEET ENTRIES THE C OUNSEL OF ASSESSEE TOOK PART IN ASSESSMENT PROCEEDINGS ON 29.12.2008 & 30.12.2008. THE ISSUE OF NOTICE U/S 143(2) IS A MANDATORY REQUIREMENT WHICH CAN NOT BE CURED EVEN AFTER THE INSERTION OF SEC.292BB OF THE ACT AS HELD IN VARIOU S JUDICIAL PRONOUNCEMENTS. THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT , LUCKNOW VS. SALARPUR COLD STORAGE (PVT.) LTD. HAS CLEARLY HELD THAT ASSUMPTION ON JURISDICTION WITHOUT ISSUING OF NOTICE U/S 143(2) C ANNOT BE CURED BY I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 14 TAKING RECOURSE TO DEEMING FICTION U/S 292BB OF THE ACT. THE RELEVANT FINDINGS OF THE HONBLE COURT ARE REPRODUC ED BELOW. SECTION 292BB WAS INSERTED BY THE FINANCE ACT, 20 08 WITH EFFECT FROM 1-4-2008. SECTION 292BB PROVIDES A DEEMING FICTION. THE DEEMING FICTI ON IS TO THE EFFECT THAT ONCE THE ASSESSEE HAS APPEARED IN ANY PROCEEDINGS OR COOPERATED IN ANY EN QUIRY RELATING TO AN ASSESSMENT OR REASSESSMENT, IT SHALL BE DEEMED THAT ANY NOTICE UN DER THE PROVISIONS OF THE ACT, WHICH IS REQUIRED TO BE SERVED ON THE ASSESSEE, HAS BEEN DULY SERVED UPON HIM IN TIME IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. THE ASSESSEE IS PRECLUDED FR OM TAKING ANY OBJECTION IN ANY PROCEEDING OR ENQUIRY THAT THE NOTICE WAS (I) NOT SERVED UPON HIM ; OR (II) NOT SERVED UPON HIM IN TIME; OR (III) SERVED UPON HIM IN AN IMPROPER MANNER. IN OTHER WOR DS, ONCE THE DEEMING FICTION COMES INTO OPERATION, THE ASSESSEE IS PRECLUDED FROM RAISING A CHALLENGE ABOUT THE SERVICE OF A NOTICE, SERVICE WITHIN TIME OR SERVICE IN AN IMPROPER MANNER. THE P ROVISO TO SECTION 292BB HOWEVER, CARVES OUT AN EXCEPTION TO THE EFFECT THAT THE SECTION SHALL N OT APPLY WHERE THE ASSESSEE HAS RAISED AN OBJECTION BEFORE THE COMPLETION OF THE ASSESSMENT OR REASSESS MENT. SECTION 292BB CANNOT OBVIATE THE REQUIREMENT OF COMPLYING WITH A JURISDICTIONSAL CON DITION. FOR THE ASSESSING OFFICER TO MAKE AN ORDER OF ASSESSMENT UNDER SECTION143(3) IT IS NECES SARY TO ISSUE A NOTICE UNDER SECTION 143(2) AND IN THE ABSENCE OF A NOTICE UNDER SECTION 143(2) THE ASSUMPTION OF JURISDICTION ITSELF WOULD BE INVALID. [PARA 9 AND 10] THIS PRINCIPLE IS NO LONGER IN DOUBT HAVING DUE REG ARD TO THE LAW LAID DOWN BY THE SUPREME COURT IN THE DECISION IN ASSTT. CIT V. HOTEL BLUE MOON [20101 321 ITR 362/188 TAXMAN 113 . WHILE CONSTRUING THE PROVISIONS OF CHAPTER XIV-B OF THE A CT IN RELATION TO BLOCK ASSESSMENTS, THE SUPREME COURT IN THAT DECISION CONSIDERED THE EFFECT OF SEC TION 143(2) AND HAS, THEREFORE, CLEARLY HELD THAT THE OMISSION ON THE PART OF THE ASSESSING OFFICER T O ISSUE A NOTICE UNDER SECTION 143(2) IS NOT A PROCEDURAL IRREGULARITY AND IS NOT CURABLE. THE REQ UIREMENT OF A NOTICE UNDER SECTION 143(2) CANNOT BE DISPENSED WITH. [PARAS 11 AND 12] IN OUR VIEW, WHERE THE ASSESSING OFFICER FAILS TO I SSUE A NOTICE WITHIN THE PERIOD OF SIX MONTHS AS SPELT OUT IN THE PROVISO TO CLAUSE (II) O F SECTION 143(2),THE ASSUMPTION OF JURISDICTION UNDER SECTION 143(3) WOULD BE INVALID. THIS DEFECT IN REGARD TO THE ASSUMPTION OF JURISDICTION CANNOT BE CURED BY TAKING RECOURSE TO THE DEEMING F ICTION UNDER SECTION 292BB. THE FICTION IN SECTION 292BB OVERCOMES A PROCEDURAL DEFECT IN REGA RD TO THE NON SERVICE OF A NOTICE ON THE ASSESSEE, AND OBVIATES A CHALLENGE THAT THE NOTICE WAS EITHER NOT SERVED OR THAT IT WAS NOT SERVED IN TIME OR THAT IT WAS SERVED IN AN IMPROPER MANNER, W HERE THE ASSESSEE HAS APPEARED IN A PROCEEDING OR COOPERATED IN AN ENQUIRY WITHOUT RAISING AN OBJE CTION. SECTION 292BB CANNOT COME TO THE AID OF THE REVENUE IN A SITUATION 1 WHERE THE ISSUANCE OF A NOTICE ITSELF WAS NOT WITH IN THE PRESCRIBED PERIOD, IN WHICH EVENT THE QUESTION OF WHETHER IT W AS SERVED CORRECTLY OR OTHERWISE, WOULD BE OF NO RELEVANCE WHATSOEVER. FAILURE TO ISSUE A NOTICE WIT HIN THE PRESCRIBED PERIOD WOULD RESULT IN THE ASSESSING OFFICER ASSUMING JURISDICTION CONTRARY TO LAW. [PARA 13] FOR THE AFORESAID REASONS, THERE IS NO ERROR IN THE VIEW WHICH WAS TAKEN BY THE TRIBUNAL. THE APPEAL IS ACCORDINGLY, DISMISSED. [PARA 15] IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES AND IN VIEW OF THE JUDICIAL PRECEDENTS WE DECIDE THE ADDITIONAL GROUND RAISED B Y ASSESSEE IN HIS FAVOUR AND THEREFORE, ASSESSMENT ORDERS ARE QUASHED . I TA NOS.369, 370, 374 & 375 (ASR)/2012 ASST. YEARS: 2004-05 & 2005-06 15 12. SINCE WE HAVE DECIDED THE JURISDICTIONAL ISS UE NOTHING SURVIVES ON MERITS TO BE ADJUDICATED AS ALL OTHER GROUNDS RAISED BY AS SESSEE AS WELL AS THE REVENUE HAS BECOME INFRUCTUOUS. 13. IN NUTSHELL, THE APPEALS FILED BY ASSESSEE WITH RESPECT TO ADDITIONAL GROUND OF APPEAL IS ALLOWED AND THE APPEALS FILED BY THE R EVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 01 .08.2016. SD/- SD/- (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 01.08.2016. /PK/PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER