ITO, Lucknow V. Mohd. Khaliq, Lucknow

ITA 520/LKW/2010

• Counselvise Citation: 52023714 RSA 2010
• Duration Of Justice: 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 29-03-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 06-08-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANADI VERMA
• Keywords: Unexplained investment; Business income; Depreciation; Additional evidence; Validity of assessment; Reason to believe
• Section: 143(3); 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A : LUCKNOW BEFORE SHRI H. L. KARWA, HONBLE VICE PRESIDENT AND SHRI N. K. SAINI, ACCOUNTANT MEMBER I.T.A. NO.520/LKW/10 ASSESSMENT YEAR: 07-08 INCOME TAX OFFICER-3(2), VS. MR. MOH D. KHALIQ, LUCKNOW. 529-KA-205, OLD KHURRAM NAGAR, LUCKNOW. PAN:AGZPK4947P (APPELLANT) (RESPONDENT) C.O. NO.40/LKW/10 (IN I.T.A. NO.520/LKW/10) ASSESSMENT YEAR: 07-08 MR. MOHD. KHALIQ, VS. INCOME TAX OFFICER-3(2 ), LUCKNOW. LUCKNOW. (OBJECTOR) (RESPONDENT) REVENUE BY : SHRI ANADI V ERMA, D. R. ASSESSEE BY: SHRI AMIT SH UKLA, ADVOCATE O R D E R PER N. K. SAINI: THE APPEAL BY THE DEPARTMENT AND THE CROSS OBJECT ION BY THE ASSESSEE ARE ARISING OUT OF THE ORDER DATED 26/05/2010 OF TH E CIT(A)-I, KANPUR RELATING TO ASSESSMENT YEAR 2007-2008. IN THE DEPARTMENTAL APPE AL IN I.T.A. NO.520/LKW/10, FOLLOWING GROUNDS HAVE BEEN RAISED: 2 1. THE LD. CTT(A) HAS ERRED IN LAW AND FACTS IN DE LETING THE ADDITION OF `4,75, 456/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN CONSTRUCTION OF BUILDING. THE SOURCE OF INVESTMENT SUBMITTED BEFORE LD. CIT(A) WERE NEVER FURNISHED BEFORE THE A.O. THE LD. CIT(A) ERRED IN A DMITTING ADDITIONAL EVIDENCE WITHOUT RECORDING REASONS IN WR ITING FOR ITS ADMISSION IN CONTRAVENTION TO THE PROVISIONS OF RULE 46A OF I.T. RULES. 2. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN DEL ETING ADDITIONS OF ` 6,57,493/- AND ` 80,000/- BY TREATING THEM AS AGRICULTURE INCOME AGAINST THE BUSINESS INCOME TREA TED BY A.O. THE LD. CIT(A) FAILED TO APPRECIATE THE (KHASA RA) REPORT OF LEKHPAL WHEREIN GROWING OF POTATO, CUCUMBER, WATERMELON AND MELON WAS DENIED. 3. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN DEL ETING THE AMOUNT OF ` 6,77,600/- ON ACCOUNT OF UNEXPLAINED ADVANCES RECEI VED BY HOLDING THAT TRANSACTIONS ARE GENUINE AND ROUTED TH ROUGH BANK A/C. LD. CIT(A) FAILED TO APPRECIATE THAT IDEN TITY AND GENUINENESS OF TRANSACTIONS REMAINED UNEXPLAINED BE FORE THE A.O. 4. ANY OTHER GROUND THAT MAY ARISE OR BECOMES INCID ENTAL DURING THE PENDENCY OF APPEAL. 2. IN ASSESSEES C.O. NO.40/LKW/10, FOLLOWING GROUN DS HAVE BEEN RAISED: 1.1 BECAUSE THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION OF SUMS AGGREGATING ` 3,95,000/- OUT OF ` 5,87,000/- APPEARING AS LIABILITY IN THE BALANCE SH EET TOWARDS ADVANCE RECEIVED FROM VARIOUS PERSONS FOR PURCHASE OF PLOTS AS NON-GENUINE, WITHOUT APPRECIAT ING THE FACTS AND MATERIAL ON RECORD. 1.2 BECAUSE IT IS UNDISPUTED FACT THAT THE ASSESSEE WAS A COMMISSION AGENT, FACILITATING VARIOUS PERSONS FOR THE PURCHASE OF PLOTS FROM THE LAND OWNERS AND THE ADVA NCE RECEIVED FROM SUCH PURCHASERS WERE THROUGH ACCOUNT PAYEE 3 CHEQUES DRAWN ON THEIR RESPECTIVE BANK ACCOUNT COUL D NOT HAVE BEEN TREATED AS NON-GENUINE AND THE ONUS THAT LAY UPON THE APPELLANT, WAS FULLY DISCHARGED AND NO ADV ERSE INFERENCE COULD HAVE BEEN DRAWN BY THE AUTHORITIES BELOW SIMPLY BECAUSE THESE PERSONS WERE NOT FOUND ON THE ADDRESS GIVEN BY THE ASSESSEE. 2.1 BECAUSE THE GROUNDS OF APPEAL NO.1 AS TAKEN BY THE REVENUE (ASSESSING OFFICER) IN MEMO OF APPEAL, WITH REGARD TO ADDITION OF ` 4,75,456/- ON ACCOUNT OF UNEXPLAINED INVESTMENTS IN THE CONSTRUCTION OF BUILDING, THAT C IT(A) HAS ERRED IN ADMITTING THE ADDITIONAL EVIDENCE IN VIOLA TION OF RULE 46A OF I.T. RULES, IS WHOLLY ERRONEOUS AS NO SUCH A DDITIONAL EVIDENCE ON THIS ISSUE WAS FURNISHED BEFORE THE CIT (A), BUT IT WAS ONLY EXPLAINED TO HIM THE SOURCE OF INVESTME NT FROM THE ENTRIES APPEARING IN THE BOOKS OF ACCOUNT PRODU CED BEFORE THE ASSESSING OFFICER. 2.2 BECAUSE THE POWER OF THE CIT(A) ARE CO-TERMINUS WITH THAT OF THE ASSESSING OFFICER AND IN EXERCISE OF SUCH PO WER, HE HAS HIMSELF VERIFIED THE SOURCES OF INVESTMENTS IN THE CONSTRUCTION OF THE BUILDING FROM THE BOOKS OF ACCO UNT AND OTHER RELEVANT RECORD THAT WERE PRODUCED BEFORE THE ASSESSING OFFICER AND AFTER APPRECIATING THE EXPLAN ATION AND THE MATERIAL ON RECORD, HE HAS RIGHTLY GIVEN THE RE LIEF OF ` 4,75,456 AND THE GROUND TAKEN BY THE DEPARTMENT THA T THERE IS VIOLATION OF RULE 46A IS WHOLLY ERRONEOUS IN LAW AND ON FACTS. 3. BECAUSE THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION OF ` 12,800/- ON ACCOUNT OF PURCHASE OF WATER PUMP WITHOUT APPRECIATING THAT THE APPELLA NT HAS SUFFICIENT CASH BALANCE AND THE SOURCE TO PROVE SUC H PURCHASE. 4. BECAUSE THE LD. CIT (A) HAS ERRED IN LAW IN HOLDING THAT THE VALIDITY OF SERVICE OF NOTICE UNDER SECTION 143 (2) COULD NOT BE CHALLENGED BEFORE HIM WITHOUT APPRECIATING T HAT THE APPELLATE STAGE IS CONTINUATION OF THE ASSESSMENT PROCEEDINGS AND SAME CAN BE RAISED AT APPELLATE STA GE. 4 3. FIRST WE WILL DEAL WITH THE ASSESSEES CROSS OB JECTION. BOTH THE PARTIES ARGUED THE GROUND NO. 4 AT THE FIRST INSTANCE WHICH IS ON LEGAL ISSUE AND RELATES TO THE VALIDITY OF SERVICE OF NOTICE U/S 143(2) OF THE I.T. ACT. 4. THE FACTS RELATED TO THIS ISSUE, IN BRIEF, ARE T HAT THE ASSESSEE FILED HIS RETURN OF INCOME DECLARING AN INCOME OF ` 1,30,240/- AND AGRICULTURAL INCOME OF ` 9,19,972/-. THE CASE WAS SELECTED FOR SCRUTINY AND THE NOTICE U/S 143(2) DATED 29/09/2008 WAS ISSUED AND SENT BY SPEED POST RECEIP T NO. EU9480130871N TO THE ASSESSEE. THE ASSESSING OFFICER FRAMED THE ASS ESSMENT AT AN INCOME OF ` 26,62,724/- BY MAKING THE VARIOUS ADDITIONS. 5. THE ASSESSEE CARRIED THE MATTER TO LEARNED CIT(A ) AND CHALLENGED THE VALIDITY OF THE ASSESSMENT ORDER ON THE GROUND OF N ON SERVICE OF NOTICE U/S 143(2) OF THE I.T. ACT WITHIN A PERIOD OF 12 MONTHS AS REQ UIRED UNDER THE PROVISO TO SECTION 143(2)(II) OF THE I.T. ACT AND SUBMITTED TO THE LEARNED CIT (A) THAT THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY VIDE NOTICE DATED 29/09/2008 U/S 143(2) OF THE I.T. ACT WHICH WAS SENT THROUGH SPEED POST ON THE ADDRESS SHRI MOHD. KHALIK, 9/13, VIKAS NAGAR, LUCKNOW WHICH IS INCORRECT AS THIS ADDRESS PERTAINS TO M/S K.K. PALACE, WHICH IS A DIFFERENT E NTITY ALTOGETHER. IT WAS FURTHER SUBMITTED THAT AS PER THE INFORMATION ON RECORD AND ALSO THE ADDRESS MENTIONED IN THE INCOME TAX RETURN THE CORRECT ADDRESS WAS M OHD. KHALEEQUE, 529KA/205, OLD KHURRAM NAGAR, LUCKNOW, FROM WHERE THE ASSESSE E HAD BEEN CARRYING OUT HIS BUSINESS ACTIVITIES AND WAS ASSESSED TO TAX FRO M LAST SEVERAL YEARS. IT WAS 5 CLAIMED THAT AFTER VERIFICATION OF RECORDS IT WAS F OUND THAT NO COMPLIANCE WAS MADE TO THIS NOTICE AS THE SAME WAS NOT SERVED UPON THE ASSESSEE. THUS, THE MANDATORY REQUIREMENT OF ISSUANCE AND SERVICE OF PR OPER NOTICE U/S 143(2) OF THE I.T. ACT WITHIN THE PERIOD OF 12 MONTHS FROM THE EN D OF THE MONTH IN WHICH RETURN HAS BEEN FILED HAS NOT BEEN COMPLIED WITH, WHICH RE NDERED THE ENTIRE ASSESSMENT PROCEEDINGS AS NULL AND VOID. 5.1 THE LEARNED CIT(A), AFTER CONSIDERING THE SUBMI SSIONS OF THE ASSESSEE, OBSERVED THAT THE NOTICE U/S 143(2) OF THE I.T. ACT HAS BEEN ISSUED ON 29/09/2008 WHICH IS AFTER 01/04/2008 AND THE NEWLY INSERTED SE CTION 292BB BY THE FINANCE ACT, 2008 PROVIDES WITH EFFECT FROM 01/04/2008 THAT IF THE ASSESSEE HAS NOT RAISED ANY OBJECTION BEFORE THE COMPLETION OF SUCH ASSESSMENT OR REASSESSMENT IN RELATION TO THE PROCEEDINGS COMMENCED AFTER 01/0 4/2008, THE ASSESSEE IS PRECLUDED FROM RAISING ANY OBJECTION THAT THE NOTIC E HAS NOT BEEN SERVED UPON HIM WITHIN THE STATUTORY TIME OR THE SERVICE OF NOT ICE WAS NOT PROPER. THE LEARNED CIT (A) POINTED OUT THAT THE NOTICE U/S 143 (2) OF THE I.T. ACT HAS BEEN ISSUED AFTER 01/04/2008 I.E. ON 29/09/2008, HENCE, THE OBJECTION RAISED BY THE ASSESSEE WAS NOT TENABLE AS PER THE PROVISIONS OF S ECTION 292BB OF THE I.T. ACT. HE ACCORDINGLY DID NOT FIND MERIT IN THE SUBMISSION S OF THE ASSESSEE. NOW THE ASSESSEE IS IN APPEAL. 6. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT THE ASSESSEE CHALLENGED 6 THE VALIDITY OF SERVICE OF NOTICE BEFORE THE LEARNE D CIT (A) WHO WITHOUT APPRECIATING THE FACTS IN RIGHT PERSPECTIVE DISMISS ED THE GROUND RAISED BY THE ASSESSEE. IT WAS FURTHER SUBMITTED THAT THE LAST D ATE OF SERVICE OF NOTICE IN THE PRESENT CASE WAS 30/09/2008 BUT THE NOTICE DATED 29 /09/2008 WAS ISSUED AT 7.17 P.M. ON 30/09/2008 BY SPEED POST, SO THERE WAS NO Q UESTION OF SERVING THE NOTICE ON THE SAME DATE TO THE ASSESSEE. IT WAS PO INTED OUT THAT THE ASSESSEE SOUGHT THE INFORMATION UNDER THE RIGHT TO INFORMATI ON ACT, 2005 FROM THE ASSESSING OFFICER, WHO, VIDE LETTER DATED 15/02/201 1, INFORMED THAT THE NOTICE WAS SENT BY SPEED POST ON 30/09/2008 AT 7.17 P.M. IN SUPPORT OF THE ABOVE CONTENTION, REFERENCE WAS MADE TO PAGE NO. 2 OF THE ASSESSEES COMPILATION, WHICH IS THE COPY OF THE INFORMATION SUPPLIED BY TH E INCOME TAX OFFICER-III(2), LUCKNOW. IT WAS CONTENDED THAT THE NOTICE U/S 143( 2) OF THE I.T. ACT WAS NOT SERVED WITHIN THE STIPULATED TIME, THEREFORE, THE A SSESSMENT FRAMED WITHOUT SERVICE OF VALID NOTICE WAS VOID AB INITIO. THE RE LIANCE WAS PLACED ON THE FOLLOWING CASE LAWS: (I) CIT VS. AVI-OIL INDIA LTD. [2010] 323 ITR 242 (P&H) (II) NULON INDIA LTD. VS. INCOME TAX OFFICER [2010 ] 323 ITR 681 (DEL) (III) ITAT LUCKNOW B BENCH ORDER DATED 19/03/2010 IN I.T.A. NO.495/LUC/09 FOR THE ASSESSMENT YEAR 2002-2003 IN THE CASE OF SHRI SANJEEV AGARWAL VS. ACIT (IV) ITAT LUCKNOW B BENCH ORDER DATED 07/03/2011 IN I.T.A. NO.565/LUC/10 FOR THE ASSESSMENT YEAR 2002-2003 IN THE CASE OF RAJEEV AGARWAL VS. ACIT (V) ANDHRA PRADESH CEMENT CO. LTD. VS. CIT [1998] 2 32 ITR 364 (VI) KARIMTARUVI VS. STATE OF KARNATAKA [1966] 60 I TR 62 (VII) KANPUR PLASTIPACK LTD. VS CIT IN I.T.A. NO. 2 8 OF 2007 (ALLD) ORDER DATED 30/03/2007 7 (VIII) CIT VS. EQBAL SINGH SINDHANA [2010] 304 ITR 177 (DEL) (IX) VIRENDRA DEV DIXIT VS. ACIT [2010] 41 DTR (ALL ) 43 (X) CIT VS. CEBON INDIA LTD. [2010] 229 CTR 188 (P& H) (XI) HOTEL BLUE BOON [2010] 321 ITR 362 (SC) (XII) CIT VS. RAJEEV SHARMA [2010] 40 DTR (ALL) 129 (XIII) KUBER TOBACCO PRODUCTS PVT. LTD. VS. DY. CIT [2009] 310 ITR (AT) 300 (DELHI) (SB) 7. THE LEARNED D. R. IN HIS RIVAL SUBMISSIONS STRON GLY SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT TH E ASSESSEE PARTICIPATED IN THE ASSESSMENT PROCEEDINGS, THEREFORE, THE ASSESSMENT W AS RIGHTLY FRAMED EVEN IF THE NOTICE WAS NOT SERVED UPON THE ASSESSEE IN VIEW OF THE PROVISIONS CONTAINED IN SECTION 292BB OF THE I.T. ACT WHICH IS APPLICABL E WITH EFFECT FROM 01/04/2008 AND AS PER THE DEEMING PROVISIONS CONTAINED IN THE AFORESAID SECTION 292BB OF THE I.T. ACT, WHERE AN ASSESSEE HAS APPEARED IN ANY PROCEEDINGS OR CO-OPERATED IN ANY ENQUIRY RELATING TO AN ASSESSMENT, IT SHALL BE DEEMED THAT ANY NOTICE UNDER ANY PROVISION OF THIS ACT, WHICH IS REQUIRED TO BE SERVED UPON HIM, HAS BEEN DULY SERVED. IT WAS CONTENDED THAT IF A NOTIC E, WHICH IS REQUIRED TO BE SERVED ON OR AFTER 01/04/2008 AND IF NOT SO SERVED, THEN NOTICE CAN BE CONSIDERED AS DEEMED TO HAVE BEEN SERVED U/S 292BB OF THE I.T. ACT IF THE ASSESSEE HAS ATTENDED THE ASSESSMENT PROCEEDINGS IN RESPONSE TO THE NOTICE SERVED ON HIM. IT WAS CONTENDED THAT IN THE PRESENT CASE AS THE ASSESSEE PARTICIPATED IN THE ASSESSMENT PROCEEDINGS, IT IS T O BE PRESUMED THAT THE NOTICE U/S 143(2) HAS BEEN SERVED UPON THE ASSESSEE. HE, THEREFORE, SUBMITTED THAT THE GROUND RAISED BY THE ASSESSEE IN THE CROSS OBJE CTION, DESERVES TO BE DISMISSED. THE RELIANCE WAS PLACED ON THE FOLLOWIN G CASE LAWS: 8 (I) HINDUSTAN TRANSPORT CO. VS. INSPECTING ASSISTA NT COMMISSIONER (ALL) 189 ITR 326 8. IN HIS REJOINDER, THE LEARNED COUNSEL FOR THE AS SESSEE SUBMITTED THAT THE PROVISIONS CONTAINED IN SECTION 292BB OF THE I.T. A CT RELATE TO THE JURISDICTION OF THE ASSESSING OFFICER BUT CANNOT VALIDATE THE ASSES SMENT WHICH HAS BEEN FRAMED WITHOUT SERVING THE NOTICE U/S 143(2) OF THE I.T. ACT. IT WAS FURTHER SUBMITTED THAT THE CASE OF THE ASSESSEE RELATES TO THE ASSESSMENT YEAR 2007- 2008 AND THE PROVISIONS OF SECTION 292BB OF THE I.T . ACT ARE APPLICABLE FOR THE ASSESSMENT YEAR 2008-2009 ONWARDS. HE FURTHER SUBM ITTED THAT IN THE PRESENT CASE, THERE WAS NO VALID SERVICE OF NOTICE U/S 143( 2) OF THE I.T. ACT WHICH IS A MANDATORY REQUIREMENT FOR FRAMING THE ASSESSMENT U/ S 143(3) OF THE ACT, THEREFORE, THE ASSESSMENT ORDER IN QUESTION DESERVE S TO BE QUASHED. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND CAR EFULLY GONE THROUGH THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT C ASE, THE ASSESSEE HAS CHALLENGED THE VALIDITY OF THE ASSESSMENT ON THE BA SIS THAT THE STATUTORY NOTICE U/S 143(2) HAS NOT BEEN SERVED UPON THE ASSESSEE WI THIN THE STIPULATED PERIOD OF 12 MONTHS FROM THE DATE OF FILING OF THE RETURN. I N THE PRESENT CASE THE ASSESSEE FILED THE RETURN OF INCOME ON 08/11/2007 AND THE AS SESSING OFFICER ISSUED THE NOTICE DATED 29/09/2008 U/S 143(2) OF THE I.T. ACT, 1961 (IN SHORT, THE I.T. ACT), WHICH WAS SENT THROUGH SPEED POST ON FOLLOWING ADDR ESS: 9 SHRI MOHD. KHALIK, 9/13, VIKAS NAGAR, LUCKNOW. 9.1 THE COPY OF THE SAID NOTICE IS AVAILABLE AT PAG E NO. 3 OF THE ASSESSEES COMPILATION. THE SAID NOTICE WAS SENT BY SPEED POS T VIDE NO.EU9480130871N AT 7.17 P.M. ON 30/09/2008. THE ADDRESS OF THE ASS ESSEE AS MENTIONED IN THE ASSESSMENT ORDER, IN THE IMPUGNED ORDER OF THE CIT (A) AND FORM NO. 36A FILED BY THE ASSESSEE AND ALSO BY THE DEPARTMENT IS AS UN DER: MOHD. KHALIQ, 529-KA/205, OLD KHURRAM NAGAR, LUCKNOW. 9.2 THE ABOVE ADDRESS IS DEFINITELY DIFFERENT FROM THE ADDRESS ON WHICH THE NOTICE WAS SENT BY THE ASSESSING OFFICER. THE CLAI M OF THE ASSESSEE IS THAT THE SAID NOTICE WAS NOT RECEIVED BY HIM. THE DEPARTMEN T HAS ALSO NOT BROUGHT ON RECORD ANY MATERIAL TO SUBSTANTIATE THAT THE AFORES AID NOTICE WAS SERVED UPON THE ASSESSEE ON THE ADDRESS GIVEN IN THE INCOME TAX RET URN BY THE ASSESSEE. 9.3 TO RESOLVE THIS CONTROVERSY, WE HAVE TO DISCUSS THE RELEVANT PROVISIONS CONTAINED IN SECTION 143(2) OF THE ACT (BEFORE THE AMENDMENT APPLICABLE W.E.F. 01/04/2008) WHICH READ AS UNDER: (2) WHERE A RETURN HAS BEEN FURNISHED UNDER SECTION 139 , OR IN RESPONSE TO A NOTICE UNDER SUB-SECTION (1) OF SECTION 142 , THE ASSESSING OFFICER SHALL, (I) WHERE HE HAS REASON TO BELIEVE THAT ANY CLAIM OF LOSS, EXEMPTION, DEDUCTION, ALLOWANCE OR RELIEF MADE IN T HE RETURN IS 10 INADMISSIBLE, SERVE ON THE ASSESSEE A NOTICE SPECIF YING PARTICULARS OF SUCH CLAIM OF LOSS, EXEMPTION, DEDUC TION, ALLOWANCE OR RELIEF AND REQUIRE HIM, ON A DATE TO BE SPECIFIE D THEREIN TO PRODUCE, OR CAUSE TO BE PRODUCED, ANY EVIDENCE OR P ARTICULARS SPECIFIED THEREIN OR ON WHICH THE ASSESSEE 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 UNDERSTATED THE INCOME OR HAS NOT COMPUTED EXCESSIV E LOSS OR HAS NOT UNDER-PAID THE TAX IN ANY MANNER, SERVE ON THE ASSESSEE A NOTICE REQUIRING HIM, ON A DATE TO BE SPECIFIED T HEREIN, EITHER TO ATTEND HIS OFFICE OR TO PRODUCE, OR CAUSE TO BE PRO DUCED, ANY EVIDENCE ON WHICH THE ASSESSEE MAY RELY IN SUPPORT OF THE RETURN: [ PROVIDED THAT NO NOTICE UNDER CLAUSE (II) SHALL BE SERVED O N THE ASSESSEE AFTER THE EXPIRY OF TWELVE MONTHS FROM THE END OF THEMONTH IN WHICH THE RETURN IS FURNISHED. 9.4 FROM THE PROVISO TO CLAUSE (II) OF SUB SECTION 2 OF SECTION 143 OF THE I.T. ACT, IT IS CLEAR THAT NO NOTICE SHALL BE SERVED ON THE ASSESSEE AFTER THE EXPIRY OF TWELVE MONTHS FROM THE END OF THE MONTH IN WHICH TH E RETURN IS FURNISHED. THE USE OF WORD SHALL MAKES IT MANDATORY THAT THE NOT ICE MUST BE SERVED ON THE ASSESSEE. IN THE INSTANT CASE, NOTHING HAS BEEN BR OUGHT ON RECORD THAT THE NOTICE U/S 143(2) WAS SERVED ON THE ASSESSEE. IN OUR OPINION, THERE IS NO PLACE FOR THE PRESUMPTION WHEN THE PROVISIONS OF TH E ACT ARE VERY CLEAR AND THERE IS NO AMBIGUITY AS REGARDS TO THE SERVICE OF NOTICE WHICH MUST BE BEFORE THE STIPULATED PERIOD. AS REGARDS TO THE SE RVICE OF NOTICE IS CONCERNED, THE PROVISIONS ARE CONTAINED IN SECTION 282 OF THE ACT WHICH READ AS UNDER: 11 282. (1) THE SERVICE OF A NOTICE OR SUMMON OR REQUISITIO N OR ORDER OR ANY OTHER COMMUNICATION UNDER THIS ACT (HE REAFTER IN THIS SECTION REFERRED TO AS COMMUNICATION) MAY BE MADE BY DELIVERING OR TRANSMITTING A COPY THEREOF, TO THE P ERSON THEREIN NAMED, (A) BY POST OR BY SUCH COURIER SERVICES AS MAY BE APPROVED BY THE BOARD; OR (B) IN SUCH MANNER AS PROVIDED UNDER THE CODE OF C IVIL PROCEDURE, 1908 (5 OF 1908) FOR THE PURPOSES OF SER VICE OF SUMMONS; OR (C) IN THE FORM OF ANY ELECTRONIC RECORD AS PROVID ED IN CHAPTER IV OF THE INFORMATION TECHNOLOGY ACT, 2000 (21 OF 2 000); (D) BY ANY OTHER MEANS OF TRANSMISSION OF DOCUMENT S AS PROVIDED BY RULES MADE BY THE BOARD IN THIS BEHALF. (2) THE BOARD MAY MAKE RULES PROVIDING FOR THE ADDR ESSES (INCLUDING THE ADDRESS FOR ELECTRONIC MAIL OR ELECT RONIC MAIL MESSAGE) TO WHICH THE COMMUNICATION REFERRED TO IN SUB- SECTION (1) MAY BE DELIVERED OR TRANSMITTED TO THE PERSON THEREIN NAMED. EXPLANATION.FOR THE PURPOSES OF THIS SECTION, THE EXPRESSIONS ELECTRONIC MAIL AND ELECTRONIC MAIL MESSAGE SHALL HAVE THE MEANINGS AS ASSIGNED TO THEM IN EXPL ANATION TO SECTION 66A OF THE INFORMATION TECHNOLOGY ACT, 2000 (21 OF 2000). ] 9.5 FROM THE ABOVE PROVISIONS IT IS CLEAR THAT THE NOTICE IS TO BE SERVED ON THE PERSON NAMED THEREIN I.E. THE ASSESSEE, EITH ER BY POST OR AS IF IT WERE A SUMMON ISSUED BY A COURT IN SUCH A MANNER AS PROVIDED UNDER THE CPC. THE PROVISIONS CONTAINED IN ORDER (V) RULE 12 OF THE CPC 1908 PROVIDES THAT WHEREVER IT IS PRACTICAL, SERVICE SHA LL BE MADE ON THE 12 DEFENDANT IN PERSON WHEN PRACTICABLE OR ON HIS AGEN T. THE SAID PROVISIONS READ AS UNDER: SERVICE TO BE ON DEFENDANT IN PERSON WHEN PRACTICA BLE OR ON HIS AGENT WHENEVER IT IS PRACTICABLE, SERVICE SHALL BE MADE ON THE DEFENDANT IN PERSON, UNLESS HE HAS AN AGENT EMP OWERED TO ACCEPT SERVICE, IN SUCH CASE, SERVICE ON SUCH AG ENT SHALL BE SUFFICIENT. 9.6 IN THE PRESENT CASE, AS WE HAVE ALREADY NOTED I N THE FORMER PART OF THIS ORDER THAT THE NOTICE HAS NEITHER BEEN SERVED ON THE ASSESSEE OR ANY OTHER PERSON AUTHORIZED BY THE ASSESSEE ON THE ADDR ESS GIVEN BY THE ASSESSEE TO THE DEPARTMENT. 9.7 IN THAT VIEW OF THE MATTER, WE ARE OF THE CONSI DERED VIEW THAT IN THE INSTANT CASE THE NOTICE U/S 143(2) BEFORE COMPLETIN G THE ASSESSMENT U/S 143(3) HAS NOT BEEN SERVED UPON THE ASSESSEE. THER EFORE, THE ASSESSMENT FRAMED U/S 143(3) WAS INVALID. ON A SIM ILAR ISSUE THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. IQBAL SING H [2007] 162 TAXMAN 107 HAS HELD HAS UNDER: SO, FROM THE ENTIRE MATERIAL AVAILABLE ON RECORD, WE HAVE NO HESITATION IN HOLDING THAT NO NOTICE U/S 143(2) OF THE ACT HAD BEEN SERVED UPON THE ASSESSEE WITHIN THE PRESCRIBED PERIOD AND, THEREFORE, THE ASSESSMENT MADE BY THE ASSESSIN G OFFICER, IS INVALID. 13 9.8 SIMILARLY IN THE CASE OF VIPIN KHANNA VS. CIT [ 2002] 255 ITR 220 (P&H), THEIR LORDSHIPS, AFTER TAKING NOTICE OF CIRC ULAR NO. 549 OF 1989 OBSERVED AND HELD AS UNDER: 'THEREFORE, IN A CASE WHERE A RETURN IS FILED AND I S PROCESSED UNDER SECTION 143(1) (A) OF THE ACT AND NO NOTICE U NDER SUB- SECTION(2) OF SECTION 143 OF THE ACT THEREAFTER SER VED ON THE ASSESSEE WITHIN THE STIPULATED PERIOD OF 12 MONTHS THE ASSESSMENT PROCEEDINGS UNDER SECTION 143 COME TO AN END AND THE MATTER BECOMES FINAL. THUS, ALTHOUGH TECHNI CALLY NO ASSESSMENT IS FRAMED IN SUCH A CASE, YET THE PROCEE DINGS FOR ASSESSMENT STAND TERMINATED. THE CENTRAL BOARD OF D IRECT TAXES VIDE ITS CIRCULAR NO.549, DATED OCTOBER 31, 1 989 [1990] 182 ITR(ST.) 1, HAS EXPLAINED THE NEW PROCEDURE OF ASSESSMENT IN PARAS 5.12 AND 5.13 AS UNDER (PAGE 24 ): '5.12 SINCE, UNDER THE PROVISIONS OF SUB-SECTION (1 ) OF THE NEW SECTION 143, AN ASSESSMENT IS NOT TO BE MAD E NOW, THE PROVISIONS OF SUBSECTIONS (2) AND (3) HAVE ALSO BEEN RECAST AND ARE ENTIRELY DIFFERENT FROM THE OLD PROVISIONS. A NOTICE UNDER SUB-SECTION (2) WHICH WI LL BE ISSUED ONLY IN CASES PICKED UP FOR SCRUTINY, IS NOW ISSUED ONLY TO ENSURE THAT THE ASSESSEE HAS NOT UNDERSTATED HIS INCOME OR HAS NOT COMPUTED EXCESSIV E LOSS OR HAS NOT UNDERPAID THE TAX IN ANY MANNER WHI LE FURNISHING HIS RETURN OF INCOME. THIS MEANS THAT, U NDER THE NEW PROVISIONS, IN AN ASSESSMENT ORDER PASSED UNDER SECTION 143(3) IN A SCRUTINY CASE, NEITHER TH E INCOME CAN BE ASSESSED AT A FIGURE LOWER THAN THE RETURNED INCOME, NOR LOSS CAN BE ASSESSED AT A FIGU RE HIGHER THAN THE RETURNED LOSS, NOR A FURTHER REFUND CAN BE GIVEN EXCEPT WHAT WAS DUE ON THE BASIS OF THE RETURNED INCOME, AND WHICH WOULD HAVE ALREADY BEEN ALLOWED UNDER THE PROVISIONS OF SECTION 143(1)(A)(I I). 5.13 A PROVISO TO SUB-SECTION (2) PROVIDES THAT A N OTICE UNDER THE SUBSECTION CAN BE SERVED ON THE ASSESSEE 14 ONLY DURING THE FINANCIAL YEAR IN WHICH THE RETURN IS FURNISHED OR WITHIN SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE RETURN IS FURNISHED, WHICHEVER IS LATE R. THIS MEANS THAT THE DEPARTMENT MUST SERVE THE SAID NOTIC E ON THE ASSESSEE WITHIN THIS PERIOD, IF A CASE IS PI CKED UP FOR SCRUTINY. IT FOLLOWS THAT IF AN ASSESSEE, AFTER FURNISHING THE RETURN OF INCOME DOES NOT RECEIVE A NOTICE UNDER SECTION 143(2) FROM THE DEPARTMENT WITHIN THE AFORESAID PERIOD, HE CAN TAKE IT THAT THE RETURN FI LED BY HIM HAS BECOME FINAL AND NO SCRUTINY PROCEEDINGS AR E TO BE STARTED IN RESPECT OF THAT RETURN.' (EMPHASIS SUPPLIED). THUS, IT IS EVIDENT THAT THE BOARD ITSELF CONCEDES THAT IF THE ASSESSEE AFTER FURNISHING THE RETURN OF INCOME DOES NOT RECEIVE A NOTICE UNDER SECTION 143(2) OF THE ACT WI THIN THE STIPULATED PERIOD HE CAN TAKE IT THAT THE RETURN FI LED BY HIM HAS BECOME FINAL AND NO SCRUTINY PROCEEDINGS ARE TO BE STARTED IN RESPECT OF THAT RETURN. HERE IT NEEDS TO BE CLARIFI ED THAT IN THE BOARD'S CIRCULAR (SEE [1990] 182 ITR(ST.) I) THE ST IPULATED PERIOD HAS BEEN REFERRED TO AS SIX MONTHS AS IT WAS THE PERIOD SPECIFIED ORIGINALLY WHEN THE NEW PROVISION WAS INT RODUCED WITH EFFECT FROM APRIL 1, 1989. HOWEVER, VIDE AMEND MENT MADE BY THE FINANCE (NO.2) ACT, 1991, THIS PERIOD W AS ENHANCED TO TWELVE MONTHS WITH EFFECT FROM OCTOBER 1, 1991. IN THE PRESENT CASE IT IS AN ADMITTED POSITION THAT NO NOTICE UNDER SECTION 143(2) OF THE ACT HAD BEEN SERVED TO THE PETITIONER WITHIN THE STIPULATED PERIOD AND AS SUCH HIS RETURN HAD BECOME FINAL.' 9.9 THE RATIO LAID DOWN IN THE AFORESAID CASE HAS B EEN FOLLOWED BY HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT VS. M . CHELLAPPAN AND ANOTHER [2006] 281 ITR 444 (MAD). 15 9.10 ON A SIMILAR ISSUE, THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF MOHAN DAIRY VS. UOI [2006] UPTC 461 (ALLAHABAD) HAS HELD AS UNDER: '7. HAVING HEARD LEARNED COUNSEL FOR THE PARTIES, I N MY VIEW, ORDER OF TRIBUNAL IS NOT SUSTAINABLE. THERE IS NO D ISPUTE THAT BEFORE PASSING THE ASSESSMENT ORDER UNDER SECTION 1 43(3) OF THE ACT, ISSUANCE OF NOTICE UNDER SECTION 143(2) OF THE ACT WITHIN THE SPECIFIED TIME, IS MANDATORY AND IN CASE IF IT IS NOT ISSUED, ASSESSMENT ORDER PASSED STAND ILLEGAL. THUS , IN MY OPINION, GROUND, WHICH HAS BEEN RAISED AND SOUGHT T O BE ADDED IN THE GROUNDS OF APPEAL, IS A LEGAL GROUND W HICH GOES TO THE ROOT OF THE MATTER, AND THUS, THE TRIBUNAL O UGHT TO HAVE ALLOWED THE APPLICATION AND THE GROUND SOUGHT TO BE ADDED BE PERMITTED TO BE ADDED IN THE GROUNDS OF APPEAL. IN THE CASE OF NATIONAL THERMAL POWER COMPANY LTD. V. COMMISSIONER OF INCOME TAX (SUPRA), THE APEX COURT HELD AS FOLLOWS: 'THE VIEW THAT THE TRIBUNAL IS CONFINED ONLY TO ISS UES ARISING OUT OF THE APPEAL BEFORE THE COMMISSIONER O F INCOME TAX (APPEALS) TAKES TOO NARROW A VIEW OF THE POWERS OF THE APPELLATE TRIBUNAL (VIDE, E.G., COMMISSIONER OF INCOME TAX V. ANAND PRASAD (1981) 128 I.T.R. 388(DELHI); COMMISSIONER OF INCOME TAX V . KARAMCHAND PREMCHAND P LTD., (1969) 74 ITR 254 (GUJ) AND COMMISSIONER OF INCOME TAX V. CELLULOSE PRODUCTS OF INDIA LTD., (1985) 151 ITR 499 (GUJ)(FB ). UNDOUBTEDLY, THE TRIBUNAL WILL HAVE THE DISCRETION TO ALLOW OR NOT ALLOW A NEW GROUND TO BE RAISED. BUT W HERE THE TRIBUNAL IS ONLY REQUIRED TO CONSIDER A QUESTIO N OF LAW ARISING FROM THE FACTS WHICH ARE ON RECORD IN T HE ASSESSMENT PROCEEDINGS, WE FAIL TO SEE WHY SUCH A QUESTION SHOULD NOT BE ALLOWED TO BE RAISED WHEN IT IS NECESSARY TO CONSIDER THAT QUESTION IN ORDER TO COR RECTLY ASSESS THE TAX LIABILITY.' 16 9.11 ON A SIMILAR ISSUE THE HON'BLE DELHI HIGH COUR T IN THE CASE OF NULON INDIA LTD. VS. INCOME TAX OFFICER (DELHI) [2010] 323 ITR 681 (DELHI) HAS HELD AS UNDER: THAT THE NOTICE HAD BEEN DISPATCHED ON OCTOBER 30, 2002, AND THEREAFTER IT HAD BEEN REDIRECTED TO THE NOIDA ADDR ESS OF THE ASSESSEE. THERE WAS NOTHING ON RECORD TO SHOW ON WH ICH DATE THIS NOTICE WAS RECEIVED AT THE GIVEN ADDRESS OF THE ASS ESSEE AND ON WHICH DATE IT WAS REDIRECTED. THERE WAS NO PRESUMPT ION UNDER THE LAW THAT ANY NOTICE SENT BY SPEED POST MUST HAVE BE EN DELIVERED TO THE ASSESSEE WITHIN 24 HOURS. MORE-OVER, THERE WAS NOTHING ON RECORD TO SHOW AT WHOSE INSTANCE THE NOTICE WAS RED IRECTED AND SENT TO THE ADDRESS AT NOIDA. NO NOTICE UNDER SECTI ON 143(2) OF THE ACT, WHICH IS A MANDATORY REQUIREMENT OF LAW, HAD B EEN SERVED UPON THE ASSESSEE WITHIN THE PRESCRIBED PERIOD. 9.12 IN THE PRESENT CASE THE CLAIM OF THE DEPARTMEN T IS THAT THE ASSESSEE PARTICIPATED IN THE ASSESSMENT PROCEEDINGS, THEREFO RE, AS PER THE PROVISIONS CONTAINED IN SECTION 292BB OF THE I.T. ACT, THE ASS ESSEE IS DEBARRED FROM TAKING A PLEA IN APPELLATE PROCEEDINGS BEFORE THE LEARNED CIT (A) TO CHALLENGE THE VALIDITY THEREON ON THE GROUND OF SERVICE OF NOTICE U/S 143(2) OF THE I.T. ACT. THIS CONTROVERSY HAS BEEN RESOLVED BY THE ITAT DELHI, SP ECIAL BENCH IN THE CASE OF KUBER TOBACCO PRODUCTS P. LTD. VS. DY. CIT [2009] 3 10 ITR (AT) 300 (DELHI) [SB] BY HOLDING AS UNDER: SECTION 292BB HAS BEEN MADE EFFECTIVE BY THE LEGIS LATURE FROM APRIL 1, 2008, AND THERE IS NOTHING IN THE ENACTMEN T TO SHOW THAT SECTION 292BB HAS RETROSPECTIVE OPERATION. THE FIRS T AND FOREMOST RULE OF INTERPRETATION IS THAT IN THE ABSENCE OF AN YTHING IN THE ENACTMENT TO SHOW THAT IT IS TO HAVE RETROSPECTIVE OPERATION, THE ENACTMENT CANNOT BE CONSTRUED TO HAVE RETROSPECTIVE OPERATION AND WHEN AN AMENDMENT RELATES TO A PROCEDURAL PROVISION , CREATES A NEW DISABILITY OR OBLIGATION AND IMPOSES NEW DUTY I N RESPECT OF TRANSACTIONS ALREADY COMPLETED, THE PROCEDURAL PROV ISION ALSO 17 CANNOT BE APPLIED RETROSPECTIVELY. SIMILAR IS THE P OSITION WHERE A STATUTE NOT ONLY CHANGES THE PROCEDURE, BUT ALSO CR EATES NEW RIGHTS AND LIABILITIES AND IT SHALL BE CONSTRUED TO BE PRO SPECTIVE IN OPERATION UNLESS OTHERWISE PROVIDED EITHER EXPRESSL Y OR BY NECESSARY IMPLICATION. SECTION 292BB HAS CREATED A NEW DISABILITY ON THE ASSESSEE TO THE EXTENT THAT HE IS DEBARRED FROM TAKING A PLEA IN APPELLATE PROCEEDINGS TO CHALLENGE THE VALI DITY THEREOF ON THE GROUND OF VALID ISSUANCE OF NOTICE REQUIRED TO BE GIVEN BY THE STATUTE IN A CASE WHERE THE ASSESSEE HAS APPEARED I N SUCH PROCEEDINGS OR CO-OPERATED IN THE INQUIRY RELATING TO ASSESSMENT OR REASSESSMENT. 9.13 IT HAS FURTHER BEEN HELD THAT: SECTION 292BB COULD NOT BE CONSTRUED TO HAVE RETRO SPECTIVE OPERATION AND IT HAD TO BE APPLIED PROSPECTIVELY. S ECTION 292BB IS APPLICABLE TO THE ASSESSMENT YEAR 2008-09 AND SUBSE QUENT YEARS. THE ASSESSEE WAS NOT PRECLUDED FROM TAKING ANY OBJE CTION PRIOR TO APRIL 1, 2008, I.E., UPTO MARCH 31, 2008, UNDER SEC TION 292BB, REGARDING INVALIDITY OF ASSESSMENT OR REASSESSMENT ON THE GROUND OF IMPROPER ISSUANCE OF NOTICE. 9.14 SIMILARLY THE HON'BLE PUNJAB & HARYANA HIGH CO URT IN THE CASE OF CIT VS. CEBON INDIA LTD. [2010] 229 CTR (P&H) 188 HAS HELD THAT: [HEAD NOTE) MERE GIVING OF DISPATCH NUMBER WILL NOT RENDER THE SAID FINDING TO BE PERVERSE IN THE ABSENCE OF SERVICE OF NOTICE THE ASSESSING OFFICER HAD NO JURISDICTION TO MAKE ASSESSMENT - A BSENCE OF NOTICE CANNOT BE HELD TO BE CURABLE UNDER SECTION 292BB OF THE I.T. ACT. 9.15 THE HON'BLE SUPREME COURT IN THE CASE OF KARIM THARUVI TEA ESTATE LTD. VS. STATE OF KERALA 60 ITR 262 HAS HELD AS UNDER: IT IS WELL-SETTLED THAT THE INCOME-TAX ACT AS IT S TANDS AMENDED ON THE FIRST DAY OF APRIL OF ANY FINANCIAL YEAR MUST A PPLY TO THE ASSESSMENT OF THAT YEAR. ANY AMENDMENTS IN THE ACT WHICH COME INTO FORCE AFTER THE FIRST DAY OF APRIL OF A FINANC IAL YEAR, WOULD NOT APPLY TO THE ASSESSMENT FOR THAT YEAR, EVEN IF THE ASSESSMENT IS ACTUALLY MADE AFTER THE AMENDMENTS COME INTO FORCE. 18 9.16 AFTER CONSIDERING THE RATIO LAID DOWN BY THE V ARIOUS HON'BLE COURTS IN THE AFORESAID REFERRED TO CASES, IT CAN SAFELY BE HELD THAT THE PROVISION OF SECTION 292BB OF THE I.T. ACT HAS BEEN INSERTED BY THE FINA NCE I.T. ACT, 2008 WITH EFFECT FROM 01/04/2008 SO THESE ARE APPLICABLE FOR THE ASS ESSMENT YEAR 2008-2009 WHILE IN THE PRESENT CASE, THE ASSESSMENT YEAR INVO LVED IS 2007-2008, THEREFORE, THE SAID PROVISIONS ARE OF NO HELP TO THE DEPARTMEN T AS FAR AS THE FACTS OF THE ASSESSEES CASE ARE CONCERNED. 9.17 A SIMILAR VIEW HAS BEEN HELD BY THE HON'BLE AN DHRA PRADESH HIGH COURT IN THE CASE OF ANDHRA CEMENTS CO. LTD. VS. CIT [1998] 232 ITR 364 WHEREIN IT HAS BEEN HELD THAT: IT IS WELL SETTLED THAT THE INCOME-TAX ACT AS IT S TANDS AMENDED ON THE FIRST DAY OF APRIL ON ANY FINANCIAL YEAR MUST A PPLY TO THE ASSESSMENT OF THAT YEAR. ANY AMENDMENTS IN THE ACT WHICH COME INTO FORCE AFTER THE FIRST DAY OF APRIL OF A FINANC IAL YEAR, WOULD NOT APPLY TO THE ASSESSMENT FOR THAT YEAR, EVEN IF THE ASSESSMENT IS ACTUALLY MADE AFTER THE AMENDMENTS COME INTO FORCE. THEREFORE, WHATEVER IS THE RATE OF TAX AS ON 1ST APRIL OF THE FINANCIAL YEAR 1983- 84 IS APPLICABLE TO THE ASSESSMENT YEAR 1983-84, TH OUGH THE ASSESSMENT IS MADE SUBSEQUENT TO THE AMENDMENT. SIN CE THE HIGHER RATES OF DEPRECIATION HAD BEEN BROUGHT INTO FORCE ON APRIL 2, 1983, THEY COULD NOT BE MADE APPLICABLE TO THE ASSE SSEE FOR THE ASSESSMENT YEARS 1982-83 AND 1983-84. 10. AS WE HAVE ALREADY POINTED OUT THAT THE ASSESSM ENT YEAR INVOLVED IN THE PRESENT CASE IS ASSESSMENT YEAR 2007-2008 AND AS PE R THE RATIO LAID DOWN BY VARIOUS HON'BLE COURTS IN THE AFORESAID REFERRED TO CASES, THE PROVISIONS OF 19 SECTION 292BB OF THE I.T. ACT INSERTED WITH EFFECT FROM 01/04/2008 ARE APPLICABLE FOR THE ASSESSMENT YEAR 2008-2009. THEREFORE, THES E PROVISIONS ARE NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. IN VI EW OF THE AFORESAID DISCUSSION AND CONSIDERING THE TOTALITY OF THE FACTS OF THE PR ESENT CASE ALONG WITH THE VARIOUS JUDICIAL PRONOUNCEMENTS, WE ARE OF THE VIEW THAT AS THE NOTICE U/S 143(2) OF THE I.T. ACT WAS NOT SERVED UPON THE ASSESSEE, THEREFOR E, ASSESSMENT FRAMED U/S 143(3) OF THE I.T. ACT IS NOT A VALID ASSESSMENT WH ICH DESERVES TO BE QUASHED. WE ORDER ACCORDINGLY. 11. BEFORE PARTING IT IS RELEVANT TO POINT OUT THAT AS FAR AS THE JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT RELIED BY THE LEA RNED D. R. IN THE CASE OF HINDUSTAN TRANSPORT CO. VS. INSPECTING ASSISTANT CO MMISSIONER (ALL) 189 ITR 326 IS CONCERNED, IN THE SAID CASE THE ISSUE INVOLV ED RELATES TO THE TERRITORIAL JURISDICTION OF THE ASSESSING OFFICER U/S 124 OF TH E I.T. ACT WHILE IN THE PRESENT CASE THE ISSUE INVOLVED RELATES TO THE SERVICE OF N OTICE WITHIN THE PERIOD STIPULATED U/S 143(2) OF THE I.T. ACT BEFORE FINALI ZATION OF THE ASSESSMENT U/S 143(3) OF THE I.T. ACT. THEREFORE, THE CASE RELIED BY THE LEARNED D. R. IS DISTINGUISHABLE ON FACTS. SINCE WE HAVE DECIDED TH E LEGAL ISSUE RAISED BY THE ASSESSEE VIDE GROUND NO. 4 OF THE CROSS OBJECTION I N HIS FAVOUR, THEREFORE, NO FINDING HAS BEEN GIVEN ON THE OTHER ISSUES RAISED B Y THE ASSESSEE ON MERIT. SIMILARLY NO FINDINGS ARE REQUIRED TO BE GIVEN IN T HE APPEAL OF THE DEPARTMENT WHEREIN THE ISSUE RELATES TO THE DELETION OF ADDITI ON ON MERIT BECAUSE WE HAVE 20 ALLOWED THE APPEAL OF THE ASSESSEE ON THE ISSUE OF LIMITATION, I.E. SERVICE OF NOTICE U/S 143(2) OF THE I.T. ACT AND SINCE THE NOT ICE U/S 143(2) OF THE ACT HAS NOT BEEN SERVED ON THE ASSESSEE, THE ASSESSMENT IS HELD TO BE INVALID. AS SUCH WE DO NOT SEE ANY MERIT IN THE APPEAL OF THE DEPART MENT. 12. IN THE RESULT, THE CROSS OBJECTION OF THE ASSES SEE IS ALLOWED AND THE APPEAL OF THE DEPARTMENT IS DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 08/04/2011) SD/. SD/. ( H. L. KARWA ) (N. K. SAINI) VICE PRESIDENT ACCOUNTANT MEMBER DATED: 08/04/2011 *SINGH COPY FORWARDED TO THE: - 1. APPELLANT. 2. RESPONDENT. 3. CIT (A) 4. CIT 5. DR. ASSISTANT REGIST RAR