SH.SOHAN LAL BHATOYA, HOSHIAR PUR V. INCOME TAX OFFICER WARD 1(4), JALANDHAR

ITA 585/ASR/2018

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 5342 (ITAT-AMRITSAR)
• Duration Of Justice: 3 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 29-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GHANSHAM SHARMA
• Keywords: Assessment record
• Section: 148; 144; 142(1); 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 Sh. Sohan Lal Bhatoya H. No. B/21-409, Babu Niwas Mohalla Salwara, Hoshiarpur. [PAN:AASPB0661N] (Appellant) Vs. Income Tax Officer, Ward 1(4), Jalandhar City. (Respondent) Appellant by Sh. Sandeep Vijh, CA Respondent by Sh.Ghansham Sharma, Sr. DR. Date of Hearing 15.09.2022 Date of Pronouncement 20.09.2022 ORDER Per Anikesh Banerjee, JM: The instant appeal of the assessee is directed against the order of Ld. Commissioner of Income Tax (Appeal)-1, Jalandhar, {in brevity theCIT(A)} bearing appeal no. 10327/16-17/CIT(A)-1/JAL, date of order 28.09.2018, order passed u/s. 250(6) of the Income Tax Act, 1961 (in brevity of the Act) for the Assessment year 2009-10. The impugned order was originated from the order of the ld. Income Tax Officer, Ward-1(4) Jalandhar, (in brevity the A.O) order passed u/s.144/148 of the Act, date of order 09.12.2016. I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 2 The assessee raised the following grounds which is as follows: “1. The Learned Commissioner of Income Tax (Appeals), has erred in sustaining the Order u/s 144 which was bad in law on various counts including non-service of notice u/s 148 as well as and various subsequent notices. 2. The assumption of jurisdiction for re-assessment is also bad in law. 3. The assessee having left for abroad, as per the impugned order, the jurisdiction over the assesse did not remain with the Income tax Officer, Ward 1(4), Jalandhar. 4. The Learned Commissioner of Income tax (Appeals) has erred in upholding addition relating to two different sale transactions pertaining to two different assessee’s in the hands of the assessee. 5. The Learned Commissioner of Income tax (Appeals) has erred in not allowing the benefit of cost of construction as claimed. The facts as stated have not been appreciated and even the amount allowed towards construction is not correct. 6. Amended grounds of appeal not considered by ld. Commissioner of Income tax (Appeals), Jalandhar.” 2. The brief fact of the case is that the assessee is a bank employee, during the assessment year 2009-10 the notice was issued u/s 148 for reopening of assessment for sale of property in Jalandhar. The notice was issued in the I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 3 address which was already assessee left. The assessee did not file the return during this assessment year. But the PAN was allotted on dated 26.11.1998. But the ld. AO did not issue the notice in the address mention in the PAN date base of ITD. The assessment was completed in exparte with addition amount of Rs.42,14,163/- for long term capital gain. 3. Aggrieved assessee filed an appeal before the ld. CIT(A) and challenged both the legal and factual aspect of the appeal. The ld. CIT(A) upheld the order of the ld. AO. 4. Being aggrieved assessee filed an appeal before us. 5. The ld. Counsel for the assessee Mr. Sandeep Vijh vehemently argued. A written submission was filed before the Bench which is kept in the record. As per the ld. Counsel the assessee has address at H.No. B/21-409, Babu Niwas Mohalla Salwara, Hoshiarpur. This address is mentioned in the PAN date base. The PAN was issued on dated 25.11.1998. 5.1 The ld. Counsel first pointed out the 1 st page of the assessment order which is reproduced as below: “1- Name & address of the assessee Sh. Sohan Lai Bhatoya, S/o Sh. Chuhar I Ram, S/o Sh. Babu Ram, 161-162, Vivek Vihar, Maqsudpur, Jalandhar. --PAN Address:- H.No.B/21-409, Babu Niwas Mohalla Salwara, Hoshairpur. 2. PAN AASPB0661N I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 4 3. Status INDIVIDUAL 4. Assessment year 2009-10 5. Date of order 09.12.2016 6. Section under which order is being passed Order u/s 144 read with section 148 of the Income Tax Act, 1961 It is a case of individual. As per information available on record, the assessee. has made an agreement on 20.08.2008 during the F.Y. 2008-09 to sold the immovable property for Rs.42,50,000/- with Sh. Dinesh Kumar Auluck, 136-Seth Hukam Chand Colony, Near DAV College, Jalandhar. The details of property is H.No.161-162, Vivek Vihar, Maqsudpur, Jalandhar Rakba 21 M 73-sts Khasra No.5/16, 15, 29//1/1,182,17//4/2,7,8/9,13,14,16/2,17,.18;24/1. As per agreement the assesse received as advance amounting to t$s/27,50,000/- and the proposed date of sale was 05.01.2009. However two saffe*de.ed i.e. of H,No161-162 was made on 31.12.2008 for Rs.8,75,000/- each, in the frame of Smt. Babita W/o Sh. Dinesh Auluck Rlo 136-Seth Hukam Chand Colony, Near DAV College, Jalandhar and Smt. Chandrika W/o Ram Shanker (Mother in law of Sh. Dinesh Auluck) H.No.516/1.3 Krishna Nagar, Jalandhar. Thus the total value of both the sale deed is Rs.17,5Q,000/- which is Rs.;25,0C)',000/- lower than the value of agreement made by the assessee. In order to verify this transaction verification letters were issued to the assessee but no compliance was made. Hence the proceedings u/s 147/148 were initiated after recording reasons.” 5.2 He further mentioned that Para 6 of the assessment order which is reproduced as below: I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 5 “6. As it is clear from the above that despite so many opportunities provided to the assessee as above the assessee neither attended the office no filed reply/explanation regarding capital gain earned on the sale of property H.No. 161-162, Vivek Vihar, Maqsudan, Jalandhar, the long term Capital gain earned on the property remained unexplained. In order to give natural justice the final opportunity was allowed to the assessee by issue of notice u/s 142(1) along with questionnaire on 07.11.2016 and sent through Speed Post and through Notice Server for hearing on 16.11.2016 at H.No.161-165, Vivek Vihar, Maqsudpur, Jalandhar. The notice sent by Speed Post returned. received back undelivered with the postal authority remark "No such person, in H.No.161-162, Vivek Vihar return to sender”. Notice server reported that ”|4iyedan yeh hai ki es letter pe diye pate k anusaar puch taash se pta chala ki yeh kardata yha se kai saal phle bahr chala gya hai es liye es pate par chasparn ker diya gya hai”. This notice u/s 142(1) along with questionnaire dated 07.11.2016 V/as also sent through Speed Post at assessee’s PAN address i.e. Sh. Sohanlal Bhatoya S/o Sh. Chuhar Ram S/o Sh. Babu Ram, H.No.B/21-409, Babu Nijiyai foohalla Salwara, Hoshairpur.” 5.3 The ld. Counsel argued that the assessee was sold out the property at H. No. 162, Vill. Maqsudpur, Tehsil and Distt. Jalandhar. The assessee was stated in this address to be selling of the property. After the transfer of the property the assessee to hisoriginal address at Hoshiarpur which is mention in the PAN database. The ld. AO wrongly issued a letter and notice in the address at I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 6 Jalandhar but due to absence of the assessee the notice was unserved. The ld. AO wrongly issued and mention the address at Jalandhar without issuing the notice in the address at Hoshiarpur which is mentioned the PAN data base. 5.4 So the entire order of the ld. AO is void for completion of assessment without serving the notice In this context, the ld. Counsel respectfully relied on the order of Hon’ble Calcutta High Court in the case of Rameshwar Sirkar vs. ITO”, (1973) 88 ITR 374 (Cal).The relevant paragraph of the order is extracted as below. “In view I have taken this application must succeed and the notices must be quashed. Notice underSection 148 of the Income-tax Act to the disrupted Hindu undivided family was without jurisdiction and it was not properly served. The said notice for the assessment year 1955-56 is hereby quashed and consequently the notice under Section 142(1) of the Income-tax Act, 1961, is also hereby quashed and set aside. The rule is made absolute to the extent indicated above. The respondents are restrained from giving any further effect to the said notices. Let writs in the nature of mandamus and certiorari issue accordingly. There will be no order as to costs.” 6. The ld. Counsel further respectfully relied on the order of the ITAT, Delhi Bench in the case of Chandra Agencies vs. ITO, 89 ITD 001 ( Service of Notice by affixture was not proper) assessment records were available with the AO and the last known address i.e. new address, was available on the I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 7 record. But AO had not made service on the last known address. Therefore, the assessment was completed u/s 144/148 could not be held as valid. 7. The ld. Sr. DR vehemently argued and mention that the AO had issued notice in present address. No other contrary evidence or the judgments were produced before the bench. 8. We heard the rival submission considered the documents available in the records and respectfully observed the judgment of the Hon’ble Apex Court& ITAT. The ld. Counsel pointed out that the notice of the ld. AO was not served in the address which is mention in the PAN data base. The mistake was also confirmed by the ld. AO himself in the order of assessment in para no. 6 and also in the cause title of the assessment order. The ld. AO also issued the notice by affixture that is also the defective service. There is no signature of the witness and when the record is available in the PAN data base the affixture of the notice is not required. We respectfully considered the order of Hon’able Supreme Court in the case of Principal Commissioner of Income-tax, Mumbaiv.I-Ven Interactive Ltd, [2019] 110 taxmann.com 332 (SC)- Scrutiny notice issued to assessee under section 143(2) at address available as per PANdatabase was justified as change in address had not been intimated to Assessing Officer.Though the order of the apex court is in favour of the revenue, but the legal- parlance is directly indicated about the jurisdiction of issuance of notice. The entire assessment was itself erroneous and bad in law I.T.A. No.585/Asr/2018 Assessment Year: 2009-10 8 due to non-service of notice to the relevant address of the assessee. The ld. Counsel had not pressed the factual aspect of the assessee. We considered only the legal issue. Accordingly, the assessment order itself is void and liable to be quashed. 9. In the result, the appeal of the assessee bearing ITA No.585/Asr/2018 is allowed. Order pronounced in the open court on 20.09.2022 Sd/- Sd/- (Dr. M. L. Meena) (Anikesh Banerjee) Accountant Member Judicial Member AKV Copy of the order forwarded to: (1) The Appellant: (2) The Respondent: (3) The CIT(A), (4) The CIT concerned (5) The Sr. DR, I.T.A.T (6) The Guard File True Copy By Order