Appeal details
Counselvise Citation
[2024] 139 COUNSELVISE.COM (IT) 8966 (ITAT-CHANDIGARH)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
7 month(s) 1 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
28-10-2024
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
A
Next Hearing Date
12-09-2024
Assessment Year
2011-2012
Appeal Filed On
27-03-2024
Judgement Text
" \n आयकर अपीलȣय अͬधकरण,चÖडीगढ़ Ûयायपीठ, चÖडीगढ़ \nIN THE INCOME TAX APPELLATE TRIBUNAL \nCHANDIGARH BENCH, ‘A’, CHANDIGARH \n \nBEFORE SHRI A.D. JAIN, VICE PRESIDENT & \nSHRI KRINWANT SAHAY, ACCOUNTANT MEMBER \n \nआयकर अपील सं./ ITA No. 309/CHD/2024 \n Ǔनधा[रण वष[ / Assessment Year : 2011-12 \n \nJagtar Singh Bassi, \nC/o Y.K.& Co., \nChartered Accountants, \n4th Floor, Ambika Tower, \nPolice Lines, \nJalandhar \nVs. \n बनाम \n \nThe ACIT \n(Int Taxation), \nCircle, \nChandigarh \nèथायी लेखा सं./PAN No: GFXPB5393R \nअपीलाथȸ/ APPELLANT \n \nĤ×यथȸ/ REPSONDENT \n \n( PHYSICAL HEARING ) \n \n \n \n \n \nǓनधा[ǐरती कȧ ओर से/Assessee by : Shri Y.K. Sud, CA \nराजèव कȧ ओर से/ Revenue by : Shri Vivek Vardhan, JCIT, Sr. DR \n \nसुनवाई कȧ तारȣख/Date of Hearing \n \n: \n12.09.2024 \nउदघोषणा कȧ तारȣख/Date of Pronouncement \n: \n 28.10.2024 \n \n \nआदेश/Order \n \nPer Krinwant Sahay, A.M.: \n \nThe appeal in this case has been filed by the Assessee against \nthe order dated 21.03.2024 of the ld. Commissioner of Income Tax \n(Appeals), Delhi-43 (herein referred to as CIT(A) \n \n2. \nGrounds of appeal taken by the Assessee are as under: - \n \n\n309-Chd-2024 – \nJagtar Singh Bassi, Jalandhar \n \n \n2 \n \n \n1. \nThat the CIT(A) was not justified in upholding \nthe action of the AO in reopening of the \nassessment u/s 147/148 of the Income Tax \nAct 1961. \n \n2. \nThat while sustaining the action of the AO of \ninitiating the reassessment proceedings u/s \n147/148, CIT (A) failed to appreciate that \nneither the notice u/s 148 was served upon the \nassessee, nor the AO has any tangible material \nin his possession for formation of belief of \nescapement of income and further no sanction \nhas been taken by the AO u/s 151 for issuance \nof the notice. \n \n3. \nThat the CIT (A) has wrongly upheld the \naddition of Rs. 1,66,13,000 made by the AO \nu/s 69 of the Income Tax Act 1961 and while \nsustaining the addition she failed to appreciate \nthe \ncomplete \ntrail \nof \ninvestment \nof \nRs. \n16613000 provided by the assessee duly \nsupported by the documents. \n \n4. \nThat the CIT (A) has recorded the incorrect facts \nin her order for the reasons best known to her \nand pass the order in a biased manner which \nis highly deplorable. \n \n5. \nThat the orders of the ACIT and CIT (A) are \n \nagainst the Law and Facts of the case. \n \n3. \nAt the very outset, the Counsel of the Assessee brought it on \nrecord that the notice was never served upon the assessee nor any \nverification letters were received because of the reason that assessee \nwas NRI and living out of India. In fact assessee came to know from \n\n309-Chd-2024 – \nJagtar Singh Bassi, Jalandhar \n \n \n3 \n \nbranch manager Canara Bank VPO Virk, Jalandhar that his bank \naccount has been attached/frozen by the department on account of \ndemand of Rs. 18335883/- which was created as a consequence of \nframing a assessment u/s 144. The assessee is not in the knowledge \nthat any kind of assessment order has been framed for the \nassessment year 2011-12 and no notice has been served on him since \nhe is NRI. On knowing this fact assessee appointed his relative as the \nattorney in India Mrs. Rozy and attorney has appointed us as a \ncounsel to complete the legal formalities in respect of order passed by \nthe department. The counsel of the assessee immediately on his \nappointment has applied for Inspection of the file of the assessee and \nnotices u/s 148, reasons for re-opening, notices u/s 142(1) and \nassessment order passed u/s 147 rw.s 144 as ex-party by way of \ninspection \nand \nphysically \ngoing \nto \nIncome \nTax \ndepartment \nChandigarh. The notice u/s 142(1) dated 10-07-2018 was returned \nback by the Postal authorities with the remarks that \"address of the \nassessee is incomplete\" The notice u/s 142(1) dated 28-09-2018 was \nreturned back by the Postal authorities with the remarks that \n\"address of the assessee is incomplete\". The show cause notice dated \n17-10-2018 was returned back by the Postal authorities with the \nremarks that \"address of the assessee is incomplete\". The notice u/s \n\n309-Chd-2024 – \nJagtar Singh Bassi, Jalandhar \n \n \n4 \n \n142(1) dated 23-10- 2018 was returned back by the Postal authorities \nwith the remarks that “address of the assessee is incomplete. \n \n4. \nWe have considered the findings of the Assessing Officer in the \nassessment order and CIT(A) in the appeal order. We have also \nconsidered the arguments of the ld. DR on this issue. In fact, the ld. \nDR mainly relied on the findings given by the CIT(A). We have also \ngone through the written submission and paper book filed by the \nCounsel of the Assessee. We have also considered the arguments \nmade by the Counsel of the Assessee in the proceedings before us. We \nfind that although the Department issued various notices u/s \n147/148 and for further assessment, even notices were sent by the \nDepartment through registered post but we also find that not even a \nsingle notice was served on the Assessee. Rather, it is brought on \nrecord by the Counsel of the Assessee, that during the inspection of \nthe records it was found that all notices issued by the Department \nwere returned back to the Department for various reasons. Keeping in \nview this fact that neither the notices u/s 148 for reopening of the \ncase was served on the Assessee nor any other notices were ever \nserved on the Assessee because of the fact that the Assessee is an NRI \nand he was not living in India and as such the Assessee could not \nreceive any notice, the entire proceedings is vitiated because of non-\n\n309-Chd-2024 – \nJagtar Singh Bassi, Jalandhar \n \n \n5 \n \nservice of the notice to the Assessee. Accordingly, the action of the \nAssessing Officer of making assessment or the CIT(A) of passing \nappellate order are not justified. Various case laws have been brought \non record such as ‘Shubhashri Panicker vs. CIT’, 403 ITR 434 in \nwhich the Hon'ble Rajasthan High Court has held that re-\nassessment notice must be served on the Assessee. It is a burden on \nRevenue to prove the service of notice sent by speed post. In the case \nof wrong address, no service of notice, the re-assessment proceedings \nare not valid. As per income tax Act, Similarly, the Hon'ble Delhi High \nCourt in the case of ‘Commissioner of Income tax vs. Chetan Gupta’, \n382 ITR 613 (Delhi) held as under:- \n“REASSESSMENT-NOTICE-SERVICE OF VALID NOTICE \nWITHIN LIMITATION- CONDITION PRECEDENT FOR \nREASSESSMENT-BURDEN OF PROOFOF SERVICE OF \nNOTICE \nON \nDEPARTMENT-PARTICIPATION \nIN \nREASSESSMENT PROCEEDINGS BY REPRESENTATIVE \nOF ASSESSEE DOES NOT RESULT INWAIVER OF \nNECESSITY OF SERVICE OF NOTICE-OBJECTION \nRAISED TONON-SERVICE OF NOTICE-REASSESSMENT \nPROCEEDINGS IGNORING OBJECTION-NOTICE AND \nCONSEQUENT REASSESSMENT NOT VALID- INCOME-\nTAX ACT, 1961, ss. 147, 148.” \n \n5. \nApart from these case laws, the ld. Counsel for the Assessee has \nalso brought on record a number of other case laws which clearly \nshow that in case notices issued u/s 148 has not been served upon \n\n309-Chd-2024 – \nJagtar Singh Bassi, Jalandhar \n \n \n6 \n \nthe Assessee, the assessment proceedings on the basis of that \nreopening is not valid. \n \n6. \nIn our considered opinion, the facts of this case are squarely \ncovered by the ratio decided by the Hon'ble Rajashtan High Court and \nHon'ble Delhi High Court in the case of ‘Mrs. Shubhashri Panicker vs. \nCIT’ (supra) and Hon'ble Delhi High Court in ‘CIT v Chetan Gupta \n(supra). Hence, the assessment proceedings in this case is quashed. \n \n7. \nAs a result, the Assessee’s appeal on this issue is allowed. \nAppeal on other Grounds do not survive. \n \n8. \nIn the result, Assessee’s appeal is allowed. \nOrder pronounced on 28 .10.2024. \n \n \n \n \n \n \nSd/- \n \n \n \n \n \nSd/- \n ( A. D. JAIN ) \n \n \n \n ( KRINWANT SAHAY) \n \nVice President \n \n \n \n \nAccountant Member \n“आर.क\nे.” \nआदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the order forwarded to : \n1. अपीलाथȸ/ The Appellant \n2. Ĥ×यथȸ/ The Respondent \n3. आयकर आयुÈत/ CIT \n4. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय आͬधकरण, चÖडीगढ़/ DR, ITAT, \nCHANDIGARH \n5. गाड[ फाईल/ Guard File \nआदेशानुसार/ By order, \nसहायक पंजीकार/ Assistant Registrar \n\n309-Chd-2024 – \nJagtar Singh Bassi, Jalandhar \n \n \n7 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n1. Draft dictated \n 28.10.2024 \nSr.PS \n2. Draft first placed before \nauthor \n \n \n3. Approved draft comes to \nSr.PS/PS \n \n \n4 \nFinal draft placed before \nauthor \n \n \n5. Order signed and \npronounced on \n \n \n6 \nFile sent to the Bench \nClerk \n \nSr.PS \n7. Date on which file goes to \nthe AR \n \n \n8. Date on which file goes to \nthe Head Clerk. \n \n \n9. Date of dispatch of Order \n \n \n"
Mehul