M/S. HEAVEN DISTILLELRY P. LTD, V. THE ITO WD-5(2)(1),

ITA 9041/MUM/2004

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1609 (ITAT-MUMBAI)
• Duration Of Justice: 11 year(s) 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 16-06-2016
• Assessment Year: 2000-2001
• Appeal Filed On: 13-12-2004
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEEPAK RIPOTE
• Assessee Lawyers: SALIL AGGARWA L G P MEHTA
• Keywords: Reason to believe
• Section: 143(3); 148; 28; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI JOGINDER SINGH, JUDICIAL MEMBER ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) M/S. HEAVEN DISTILLERY PVT. LTD., C/O. G.P.MEHTA & CO., 807, TULSIANI CHAMBERS, NARIMAN POINT, MUMBAI 400 021. PAN: AAACH 8471K ...... APPELLANT VS. THE INCOME TAX OFFICER, WARD 5(2)(1), MUMBAI. .. .. RESPONDENT APPELLANT BY : S/SHRI SALIL AGGARWA L& G.P.MEHTA RESPONDENT BY : SHRI DEEPAK RIPOTE DATE OF HEARING : 12/07/2016 DATE OF PRONOUNCEMENT : 30/11/2016 ORDER PER G.S.PANNU,A.M: THE CAPTIONED APPEAL FILED BY THE ASSESSEE PERTAI NING TO ASSESSMENT YEAR 2000-01 IS DIRECTED AGAINST AN ORDER PASSED BY CIT(A)-V, MUMBAI DATED 04/10/2004, WHICH IN TURN, ARISES OUT OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE INCOME TA X ACT, 1961 (IN SHORT THE ACT) DATED 10/11/2003. 2 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) 2. IN THIS APPEAL, ALTHOUGH ASSESSEE HAS RAISED MUL TIPLE GROUNDS OF APPEAL, BUT AT THE TIME OF HEARING, THE SOLITARY GRIEVANCE RAISED WAS IN TERMS OF GROUND OF APPEAL NO.2, CONTAINED IN THE MEMO OF APP EAL, WHICH IS TO THE EFFECT THAT THE ASSESSMENT ORDER WAS VOID AB-INITIO AS NO NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED AND SERVED UPON THE AS SESSEE WITHIN THE STIPULATED PERIOD PRESCRIBED IN THE PROVISO THEREOF . BOTH THE COUNSELS HAVE BEEN HEARD WITH RESPECT TO THE AFORESAID GROUND AND THE RELEVANT MATERIAL PERUSED. 3. IN BRIEF, THE RELEVANT FACTS ARE THAT THE APPELL ANT IT A COMPANY INCORPORATED UNDER THE PROVISIONS OF THE COMPANIES ACT, 1956 AND IS ENGAGED IN THE BUSINESS OF BLENDING AND BOTTLING OF INDIAN MADE FOREIGN LIQUOR. FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, IT FIELD A RE TURN OF INCOME ON 30/11/2000, DECLARING AN INCOME OF RS.52,380/-, WHI CH HAVE BEEN SUBJECT TO SCRUTINY ASSESSMENT UNDER SECTION 143(3) OF THE ACT , WHEREIN THE TOTAL INCOME HAS BEEN ASSESSED AT RS.47,53,290/-, AFTER MAKING V ARIOUS ADDITIONS/ DISALLOWANCES. THE ASSESSEE COMPANY HAD CARRIED T HE MATTER IN APPEAL BEFORE THE CIT(A), WHO HAS ALLOWED CERTAIN RELIEF TO THE A SSESSEE WITH RESPECT TO THE ADDITIONS/DISALLOWANCES, BUT SO FAR AS THE LEGAL PO INT RAISED BY THE ASSESSEE PERTAINING TO THE ISSUE OF WRONG ASSUMPTION OF JUR ISDICTION OF THE ASSESSING OFFICER UNDER SECTION 143(2) OF THE ACT IS CONCERN ED, THE SAME HAS BEEN HELD AGAINST THE ASSESSEE. THE SAID DECISION OF THE CIT (A) IS BEING AGITATED BEFORE US ON THE BASIS OF GROUND OF APPEAL NO.2, WHICH WE HA VE REFERRED ABOVE. 4. THE FACTUAL MATRIX IN RELATION TO THE STAND OF T HE ASSESSEE ON WRONG ASSUMPTION OF JURISDICTION BY THE ASSESSING OFFICER UNDER SECTION 143(2) OF THE ACT IS AS FOLLOWS. THE RETURN OF INCOME WAS FILED BY THE ASSESSEE ON 3 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) 30/11/2000 AND IN PARA-1 OF THE ASSESSMENT ORDER, I T IS RECORDED BY THE ASSESSING OFFICER THAT THE CASE HAS BEEN SELECTED F OR SCRUTINY ASSESSMENT BY ISSUING A NOTICE DATED 29/11/2001 UNDER SECTION 143 (2) OF THE ACT WHICH WAS SERVED BY AFFIXTURE AT ASSESSEES PREMISES AT 1/C, HAPPY HOME, NAPEAN SEA ROAD, MUMBAI 400 006 ON 29/11/2001. IT IS FURTHER RECORDED BY THE ASSESSING OFFICER THAT ON 29/11/2001, THE PREMISES WAS FOUND TO BE CLOSED AND ANOTHER NOTICE WAS ISSUED ON 23/06/2003 AND ALSO SERVED BY AFFIXTURE ON 23/06/2003 AT THE REGISTERED OFFICE OF THE ASSESSEE, SINCE THE PREMISES AT 1/C, HAPPY HOME, NAPEAN SEA ROAD, MUMBAI 400 006 WAS FOUND TO BE CLOSED. 5. IN THE BACKGROUND OF THE AFORESAID FACT-SITUATIO N, THE CASE OF THE ASSESSEE CAN BE UNDERSTOOD AS FOLLOWS. AS PER THE ASSESSEE, HAVING REGARD TO THE PROVISO TO SECTION 143(2) OF THE ACT , THE NOTI CE UNDER SECTION 143(2) OF THE ACT WAS TO BE SERVED WITHIN A PERIOD OF 12 MONTHS F ROM THE FILING OF RETURN OF INCOME I.E. ON OR BEFORE 30/11/2001. ACCORDING TO THE ASSESSEE, THE NOTICE ISSUED BY THE ASSESSING OFFICER ON 29/11/2001 AND S ERVED BY AFFIXTURE ON THE SAME DATE IS INVALID AS IT HAS NOT BEEN ISSUED IN T ERMS OF THE REQUIREMENTS OF SECTION 282(1) OF THE ACT. ACCORDING TO THE ASSESS EE, SECTION 282(1) OF THE ACT MANDATORILY REQUIRES THAT THE NOTICE IS TO BE ISSUE D EITHER BY POST OR AS IF IT WAS A SUMMONS ISSUED BY THE COURT UNDER THE CODE OF CIV IL PROCEDURE, 1908 ( 5 OF 1908). ACCORDING TO THE ASSESSEE, THE ASSESSING OF FICER HAS NOT BOTHERED TO FOLLOW THE MANDATORY REQUIREMENT OF SERVICE OF NOTI CE AND HAS STRAIGHTWAY RESORTED TO SUBSTITUTE MODE OF SERVICE(I.E. BY AFF IXTURE), WHICH IS IMPERMISSIBLE IN LAW. BEFORE THE CIT(A) AS WELL AS BEFORE US, A SSESSEE HAS POINTED OUT THAT FOR SUBSTITUTING THE SERVICE BY AFFIXTURE, THE REQU IREMENT OF LAW IS THAT THE ASSESSING OFFICER MUST BE SATISFIED THAT ASSESSEE WAS KEEPING OUT OF THE WAY FOR THE PURPOSE OF AVOIDING SERVICE OR THAT FOR ANY OTHER REASON THE SUMMON 4 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) CANNOT BE SERVED IN THE ORDINARY WAY. ACCORDING TO THE APPELLANT, IN THE PRESENT CASE, NO SUCH VALID REASONS HAVE BEEN BROUG HT OUT BY THE ASSESSING OFFICER SO AS TO RESORT TO THE SUBSTITUTED MODE OF SERVICE AND, THEREFORE, THE NOTICE UNDER SECTION 143(2) OF THE ACT CANNOT BE SA ID TO HAVE BEEN VALIDLY SERVED AND CONSEQUENTLY, THE ASSESSMENT ORDER IS VO ID AB-INITO. 6. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESEN TATIVE HAS RELIED UPON THE ORDER OF THE CIT(A) IN THIS REGARD AND POI NTED OUT THAT THE ASSESSING OFFICER HAD CHOSEN TO SERVE THE NOTICE BY AFFIXTURE IN ORDER TO AVOID A TIME LAG AS THE ISSUANCE OF NOTICE WAS GETTING TIME BARRED A ND THAT IN ANY CASE, ADOPTING THE METHOD OF SERVICE BY AFFIXTURE WAS WHO LLY WITHIN THE POWER OF THE ASSESSING OFFICER. APART THERE FROM, THE LD. DEPAR TMENTAL REPRESENTATIVE ALSO POINTED OUT THAT IT IS NOT THE CASE OF THE ASSESSEE THAT THE NOTICE UNDER SECTION 143(2) WAS NEVER SERVED BECAUSE ASSESSEE HAD APPEAR ED BEFORE THE ASSESSING OFFICER ON 6/12/2001 AND SOUGHT ADJOURNMENT. IT HA S ALSO BEEN ARGUED THAT THE ASSESSEE HAS NOT OBJECTED TO SUCH SERVICE OF NO TICE DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND, THEREFORE, THE NOTICE IS DEEMED TO BE VALID IN TERMS OF SECTION 292BB OF THE ACT. 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. THE GRIEVANCE OF THE ASSESSEE IS ESSENTIALLY ARISING FROM THE PROVIS IONS OF SECTION 282 OF THE ACT DEALING WITH PROVISIONS RELATING TO THE SERVICE OF NOTICE. IT IS SUFFICIENT TO NOTE FOR THE PRESENT, THAT SUB-SECTION (1) OF SECTION 28 2 OF THE ACT PRESCRIBES THAT A NOTICE UNDER THIS ACT MAY BE SERVED ON THE PERSON T HEREIN NAMED EITHER BY POST OR AS IF IT WERE A SUMMONS ISSUED BY A COURT U NDER THE CODE OF CIVIL PROCEDURE, 1908 ( 5 OF 1908). FACTUALLY SPEAKING, PARA-1 OF THE ASSESSMENT ORDER MAKES IT CLEAR THAT THE NOTICE UNDER SECTION 143(2) OF THE ACT ISSUED ON 5 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) 29/11/2001 HAS BEEN SERVED ON 29/11/2001 BY AFFIXTU RE. THE PLEA RAISED BY THE ASSESSEE IS THAT SERVICE OF NOTICE BY AFFIXTURE COULD HAVE BEEN RESORTED TO ONLY WHEN THE ASSESSING OFFICER DISCHARGES HIS INIT IAL ONUS BY SHOWING THAT HE HAD REASON TO BELIEVE THAT ASSESSEE WAS INTENTIONAL LY HIDING ITSELF FOR THE PURPOSE OF AVOIDING SERVICE OR THERE WERE OTHER GOO D REASONS TO COME TO THE CONCLUSION THAT THE NOTICE COULD NOT BE SERVED IN T HE ORDINARY WAY. 7.1 AT THE TIME OF HEARING, THE LD. REPRESENTATIVE FOR THE ASSESSEE HAD RELIED UPON THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. HOTLINE INTERNATIONAL PVT. LTD., 296 ITR 333(DEL), WHICH UPHOLDS THE PROPOSITION THAT SERVICE OF NOTICE BY AFFIXTURE CAN BE DONE ONL Y WHEN ASSESSEE OR HIS AGENT REFUSES TO SIGN ACKNOWLEDGEMENT OR COULD NOT BE FO UND. IN THE CASE BEFORE THE HON'BLE DELHI HIGH COURT, THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 148 OF THE ACT ON THE ASSESSEE COMPANY THROUGH THE INSPECTOR, WHO FOUND THAT THE FACTORY WAS CLOSED DUE TO HOLI FESTIVAL HOLIDAY S. AS SECURITY GUARD REFUSED TO RECEIVE NOTICE, IT WAS SERVED BY AFFIXTURE AND NOTICE WAS ALSO SENT BY REGISTERED POST WHICH REMAIN UNCOMPLIED WITH. THE ASSESSMENT SO COMPLETED WAS SOUGHT TO BE CHALLENGED ON THE GROUND AS BEING BAD IN LAW AS NO PROPER SERVICE OF NOTICE UNDER SECTION 148 WAS EFFECTED BY THE ASSESSING OFFICER ON THE ASSESSEE. IN THIS BACKGROUND, THE HONBLE HIGH COURT EXAMINED THE PROVISIONS OF SECTION 282 OF THE ACT AND ALSO ORDE R V, RULE 12 OF THE CODE OF CIVIL PROCEDURE 1908 AND OBSERVED THAT WHEREVER IT IS PRACTICABLE THE SERVICE HAS TO BE EFFECTED ON AN ASSESSEE IN PERSON OR AN A GENT. FURTHER, IT HAS BEEN OBSERVED THAT UNDER ORDER-V, RULE 17 OF CODE OF CIV IL PROCEDURE 1908 SERVICE BY AFFIXTURE CAN BE DONE ONLY WHEN THE ASSESSEE OR HIS AGENT REFUSES TO ACKNOWLEDGE THE NOTICE OR ASSESSEE COULD NOT BE FOU ND. FURTHER, THE HON'BLE DELHI HIGH COURT, IN THE CASE OF CIT VS. CHANDRA A GENCIES, 202 TAXMAN 106(DEL) 6 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) HAS OBSERVED THAT THE SERVICE OF NOTICE BY AFFIXTU RE CAN BE RESORTED TO ONLY WHEN REVENUE HAS DISCHARGED INITIAL ONUS BY SHOWING THAT THERE WAS REASON TO BELIEVE THAT THE ASSESSEE WAS INTENTIONALLY AVOIDIN G THE AUTHORITIES FOR THE PURPOSE OF AVOIDING SERVICE OF NOTICE OR THAT THERE WERE OTHER GOOD REASONS TO COME TO THE CONCLUSION THAT SUMMONS COULD NOT BE SE RVED IN THE ORDINARY WAY. BEFORE US, THE LD. REPRESENTATIVE FOR THE ASS ESSEE HAS ALSO RELIED UPON THE JUDGMENT OF THE HONBLE HIGH COURT OF ANDHRA PR ADESH IN THE CASE OF CIT VS. GODAVARI ELECTRICAL CONDUCTORS, ITA NO.249 OF 2 003 DATED 29/10/2014, WHEREIN THE DECISION OF THE TRIBUNAL, INTER-ALIA, HOLDING THAT THE ISSUANCE OF NOTICE STRAIGHTWAY THROUGH AFFIXTURE WAS NOT PROPER , HAS BEEN APPROVED. 7.2 IN THE BACKGROUND OF THE AFORESATED LEGAL POSIT ION, WE MAY NOW EXAMINE THE FACT POSITION IN THE INSTANT CASE. IN THE PRES ENT CASE, IT IS UNDENIABLE THAT THE NOTICE UNDER SECTION 143(2) DATED 29/11/2001 HA S BEEN DIRECTLY SERVED THROUGH AFFIXTURE. THE CIT(A) HAS OBSERVED THAT TH ERE WAS GOOD REASON FOR THE ASSESSING OFFICER TO TAKE THIS STEP BECAUSE OF THE NEED TO AVOID TIME LAG AS OTHERWISE THE SERVICE OF NOTICE WAS BECOMING TIME B ARRED. IN OUR CONSIDERED OPINION, THE AFORESAID CANNOT BE CONSIDERED TO BE A REASON TO JUSTIFY THE SERVICE OF NOTICE BY AFFIXTURE AFTER BY-PASSING THE NORMAL PROCEDURE OF SERVICE OF NOTICE. IN FACT, IN THE CONTEXT OF SUCH PLEA OF THE CIT(A), THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT V. DEW AN KRAFT SYSTEM (P) LTD., 165 TAXMAN 139(DEL) HAS BEEN RELIED UPON. IN THIS CASE , THE NOTICE WAS SERVED ON THE ASSESSEE BY AFFIXTURE AND IT WAS THE CASE OF TH E ASSESSING OFFICER THAT THE NOTICE UNDER SECTION 143(2) SENT BY SPEED POST COUL D NOT BE SERVED AND, THEREFORE, AN INSPECTOR WAS DEPUTED, WHO WENT TO TH E OFFICE PREMISES OF THE ASSESSEE AND ON FINDING THE SAME LOCKED, THE NOTICE WAS SERVED BY AFFIXTURE. THE ASSESSEE CONTENDED THAT THE NOTICE WAS INVALIDL Y SERVED AND THE TRIBUNAL 7 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) TOOK NOTE OF THE FACT THAT THE NOTICE WAS ISSUED AT THE VERY LAST MINUTE TO ENSURE THAT THE CASE DID NOT BECOME TIME BARRED AND NO EFFORTS WERE MADE BY THE ASSESSING OFFICER TO FIND OUT THE WHEREABOUT S OF THE ASSESSEE TO SERVE THE NOTICE, BUT A SHORT CUT WAS TAKEN BY THE INSPE CTOR BY RESORTING TO SERVICE BY AFFIXTURE. THE TRIBUNAL UPHELD THE PLEA OF THE ASSESSEE AND OBSERVED THAT THE REVENUE HAD FAILED TO DISCHARGE THE ONUS TO PRO VE THAT THE NOTICE WAS IN FACT SERVED UPON THE ASSESSEE WITHIN THE PRESCRIBED PERIOD. THE HON'BLE DELHI HIGH COURT UPHELD THE DECISION OF THE TRIBUNAL BY M AKING THE FOLLOWING DISCUSSION. 11. WE HAVE EXAMINED THE COPIES OF THE NOTICES IS SUED BY THE ASSESSING OFFICER AND FIND THAT THE NOTICES WAS ISSUED AT THE LAST MINUTE . SINCE THE OFFICE OF THE ASSESSEE WAS CLOSED, NO EFFORTS WERE MADE BY THE ASSESSING O FFICER TO FIND OUT THE WHEREABOUTS OF THE ASSESSEE TO SERVE IT BUT A SHORT CUT WAS TAKEN BY THE INSPECTOR WHO RESORTED TO AFFIXATION, WHICH WAS CARRIED OUT IN THE ABSENCE OF ANY INDEPENDENT WITNESS. IT APPEARS TO US THAT THE ENTIRE EXERCISE OF SENDING THE INSPECTOR AND RESORTING TO AFFIXATION WAS CARRIED OUT ONLY TO ENS URE THAT THE CASE DOES NOT BECOME TIME-BARRED, KNOWING FULLY WELL THAT THE NOTICES HA VE BEEN ISSUED AT THE VERY LAST MINUTE AND COULD NOT HAVE BEEN SERVED ON THE ASSESS EE WITHOUT UNDERTAKING SOME OUT OF THE ORDINARY EXERCISE AS HAS BEEN DONE IN TH E PRESENT CASE. 7.3 IN THE PRESENT CASE TOO, THERE IS NOTHING TO SU GGEST THAT THE ASSESSEE WAS INTENTIONALLY HIDING FROM THE AUTHORITIES FOR T HE PURPOSE OF AVOIDING SERVICE OR THERE WAS ANY OTHER GOOD REASON TO CONC LUDE THAT THE NOTICE COULD NOT BE SERVED IN AN ORDINARY WAY. THE INACTION OR D ELAY ON THE PART OF THE ASSESSING OFFICER IN ISSUING NOTICE UNDER SECTION 1 43(2) OF THE ACT CANNOT BE A GROUND TO STRAIGHTWAY EFFECT SERVICE BY AFFIXTURE. THUS, IN THE INSTANT CASE, THE ORDINARY PROCESS NOT HAVING BEEN EXHAUSTED OR CARRI ED OUT BY THE ASSESSING OFFICER, HE WAS NOT JUSTIFIED IN DIRECTLY RESORTING TO SERVICE OF NOTICE BY AN AFFIXTURE MERELY BECAUSE HE HAD ISSUED THE NOTICE A T THE LAST MINUTE I.E. ON 29//11/2011 SO AS TO AVOID THE LIMITATION EXPIRING ON 30/11/2001. UNDER THESE CIRCUMSTANCES, WE FIND AMPLE FORCE IN THE PLE A OF THE ASSESSEE ON THE 8 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) ISSUE OF WRONG ASSUMPTION OF JURISDICTION BY THE AS SESSING OFFICER BY ISSUING THE INSTANT NOTICE UNDER SECTION 143(2) OF THE ACT. 7.4 BEFORE US, ANOTHER PLEA RAISED BY THE REVENUE I S THAT THE ASSESSEE HAD APPEARED BEFORE THE ASSESSING OFFICER ON 10/12/2001 AND THAT ON THAT BASIS IT IS SOUGHT TO BE CANVASSED THAT, IN ANY CASE, ASSES SEE WAS AWARE OF THE NOTICE UNDER SECTION 143(2) OF THE ACT HAVING BEEN SERVED ON 29/11/2001. ON THIS ASPECT, THE LD. REPRESENTATIVE FOR THE ASSESSEE POI NTED OUT THAT THE APPEARANCE BY THE ASSESSEE ON 10/12/2001 WAS IN COM PLIANCE OF NOTICE ISSUED BY THE ASSESSING OFFICER ON 06/12/2001 IN THE NAME OF THE DIRECTOR OF THE ASSESSEE COMPANY, A COPY OF WHICH HAS BEEN PLACED I N THE PAPER BOOK AT PAGE 1. IT WAS THEREFORE, CONTENDED THAT IT IS WRONG ON THE PART OF THE REVENUE TO CONTEND THAT ASSESSEE ATTENDED BEFORE THE ASSESSING OFFICER ON 10/12/2001 IN RESPONSE TO THE NOTICE ISSUED UNDER SECTION 143(2) OF THE ACT DATED 29/11/2001. WE FIND THE AFORESAID PLEA OF THE ASSE SSEE QUITE POTENT AND IS IN FACT SUPPORTED BY THE MATERIAL ON RECORD. THE LD. REPRESENTATIVE FOR THE ASSESSEE HAD REFERRED TO A COMMUNICATION DATED 10/1 2/2001 ADDRESSED TO THE ASSESSING OFFICER, WHEREIN IT HAS BEEN COMMUNICATED THAT THE NOTICE WAS RECEIVED ON 10/12/2001 ITSELF, WHICH OSTENSIBLY IS THE NOTICE DATED 6/12/2001 ADDRESSED TO THE DIRECTOR OF THE COMPANY. THEREFOR E, THE AFORESAID PLEA OF THE REVENUE IS MISPLACED AND IS HEREBY REJECTED. 7.5 APART THEREFROM, THE LD. REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE DEFECT IN THE SERVICE OF NOTICE NAMELY NON -SERVICE OF NOTICE BY PROPER MEANS AND DIRECTLY BY AFFIXTURE IS NOT A CURABLE DE FECT AND HE HAS ASSAILED THE RELIANCE PLACED BY THE LD. DEPARTMENTAL REPRESENTAT IVE ON THE PROVISIONS OF SECTION 292BB OF THE ACT IN THIS REGARD. IN OUR CO NSIDERED OPINION, SECTION 9 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) 292BB, IN ANY CASE, DOES NOT COME TO THE RESCUE OF THE REVENUE IN THE PRESENT CASE BECAUSE IT HAS BEEN INTRODUCED BY FINANCE ACT, 2008 W.E.F. 01/04/2008 AND IT WOULD NOT APPLY IN THE INSTANT CASE. THE HO N'BLE BOMBAY HIGH COURT IN THE CASE OF CIT V. SALMAN KHAN, INCOME TAX APPEAL ( L) NO.2362 OF 2009 DATED 1 ST DECEMBER, 2009 HAS HELD THAT SECTION 292 BB OF TH E ACT INTRODUCED W.E.F. 01/04/2008 IS PROSPECTIVE IN NATURE AND WOULD NOT APPLY TO THE ASSESSMENT YEARS EARLIER THAN ASSESSMENT YEAR 2008-09. THEREF ORE, THE AFORESAID PLEA OF THE REVENUE IS ALSO MISPLACED AND IS REJECTED. 7.6 BEFORE PARTING, WE MAY ALSO REFER TO RELIANCE P LACED BY THE LD. DEPARTMENTAL REPRESENTATIVE ON THE JUDGMENT OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. VISION INC., 21 TAXMANN.COM 515 (DEL) TO EMPHASIZE THAT ONCE ASSESSEE HAS PARTICIPATED IN ASSESSMENT PROCEE DINGS IN PURSUANCE TO THE NOTICE ISSUED FOR HEARING, IT AMOUNTED TO A VALID S ERVICE OF NOTICE. IN THE CASE OF VISION INC.(SUPRA), THE RELEVANT FACTS WERE THAT IN THE ABSENCE OF PARTNERS OF ASSESSEE FIRM NOTICE UNDER SECTION 143(2) OF THE AC T WAS SERVED ON THE EMPLOYEE OF THE FIRM AT OFFICIAL ADDRESS. IN THE A PPELLATE PROCEEDINGS, ASSESSEE RAISED AN OBJECTION THAT IN THE ABSENCE OF PROPER SERVICE OF NOTICE UNDER SECTION 143(2) OF THE ACT, ASSESSMENT ORDER D ESERVES TO BE SET-ASIDE. THE AFORESAID STAND OF THE ASSESSEE DID NOT PREVAIL WITH THE HON'BLE DELHI HIGH COURT. THE HON'BLE HIGH COURT NOTED THAT NOTICE HAS BEEN SERVED AT THE ASSESSEES PREMISES AND SINCE AT THE RELEVANT POINT OF TIME THE PARTNERS WERE OUT OF STATION, NOTICE WAS SERVED ON EMPLOYEE OF TH E FIRM. THE HON'BLE HIGH COURT SPECIFICALLY NOTED THAT ASSESSEE HAS PARTICIP ATED IN ASSESSMENT PROCEEDINGS PURSUANCE TO THE NOTICE BEING DISPUTED BY THE ASSESSEE. IN THIS BACKGROUND, THE HON'BLE HIGH COURT NOTED THAT EVE N IF ONE WAS TO PROCEED ON THE ASSUMPTION THAT NOTICE WAS SERVED NEITHER ON T HE TWO PARTNERS OF THE 10 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) ASSESSEE FIRM AND THAT IT WAS SERVED ON SOME PERSON , WHO WAS NOT SPECIFICALLY AUTHORIZED TO RECEIVE THE NOTICE, YET SERVICE OF NO TICE COULD NOT BE INVALIDATED BECAUSE THE VERY SAME NOTICE HAD BEEN COMPLIED WITH BY THE ASSESSEE. NOTABLY, THE HON'BLE HIGH COURT NOTICED THAT THE NOTICE ISSUED ON 30/12/2004 HAD FIXED THE HEARING ON 05/01/2005 BEFORE THE ASSE SSING OFFICER. ON 05/01/2005 ASSESSEE PARTICIPATED IN THE PROCEEDINGS BEFORE THE ASSESSING OFFICER AND ACCORDING TO THE HON'BLE HIGH COURT S UCH PARTICIPATION WAS TO BE ATTRIBUTED TO THE SERVICE OF THE NOTICE ON 30/12/20 04 ALBIET UPON A PERSON NOT AUTHORIZED TO RECEIVE THE SAME. THIS FACT-SITUATIO N LEAD THE HON'BLE HIGH COURT TO CONCLUDE THAT THE SERVICE OF NOTICE COULD NOT BE INVALIDATED. IN OUR CONSIDERED OPINION, THE SAID JUDGMENT OF THE HON'BL E DELHI HIGH COURT DOES NOT HELP THE CASE OF THE REVENUE HEREIN BECAUSE TH E FACT-SITUATION IN THE PRESENT CASE STANDS ON AN ENTIRELY DIFFERENT FOOTIN G. IN THE PRESENT CASE, IT IS QUITE CLEAR THAT THE APPEARANCE BY THE ASSESSEE ON 10/12/2001 WAS NOT IN COMPLIANCE OF THE NOTICE ISSUED BY THE ASSESSING OF FICER ON 29/11/2001, BUT IT WAS IN COMPLIANCE OF A NOTICE ISSUED BY THE ASSESSI NG OFFICER ON 06/12/2001 IN THE NAME OF THE DIRECTOR OF THE ASSESSEE COMPANY . THEREFORE, TO SAY THAT THE ASSESSEE COMPANY HAD COME TO KNOW ABOUT THE ASSESSM ENT PROCEEDINGS IN ON TERMS OF THE NOTICE ISSUED UNDER SECTION 143(2) OF THE ACT DATED 29/11/2001 IS FACTS A MISNOMER THEREFORE, IN OUR VIEW, THE RATI O OF THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF VISION INC . (SUPRA) IS NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. 7.7 IN CONCLUSION, IT HAS TO BE HELD THAT THE NOTI CE UNDER SECTION 143(2) OF THE ACT HAS NOT BEEN SERVED WITHIN THE TIME AND THE MODE PRESCRIBED UNDER THE ACT AND AS A CONSEQUENCE, THE IMPUGNED ASSESSME NT FRAMED UNDER SECTION 11 ITA NO.9041/MUM/2004 (ASSESSMENT YEAR 2000-01) 143(3) OF THE ACT IS VOID AB-INITIO. ACCORDINGLY, THE ASSESSMENT ORDER DATED 10.11.2003 IS LIABLE TO BE QUASHED. WE HOLD SO. 7.8 IN THE RESULT, THE PLEA OF THE ASSESSEE IS ALLO WED AND SINCE ASSESSMENT ORDER HAS BEEN QUASHED, ALL OTHER GROUNDS RAISED BY THE ASSESSEE RELATING TO MERITS OF THE ADDITION BECOME ACADEMIC AND ARE DISM ISSED AS INFRUCTUOUS. 8. RESULTANTLY, APPEAL OF THE ASSESSEE IS ALLOWED , AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 30/11/2016 SD/- SD/- (JOGINDER SINGH) (G.S.PANNU) JUDICIAL MEMBER ACCOCUNTANT MEMBER MUMBAI, DATED 30/11/2016 VM , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI