2008 (5) TMI 609 - AT - Income Tax

Summary

Issues involved:
The legal issue of validity of notices issued by the Assessing Officer under section 143(3)(ii) of the Income Tax Act.

Legal Issue: Validity of Notice under Section 143(2)(ii):
The assessee challenged the validity of the notice under section 143(2)(ii) as time-barred, contending that it was served after the prescribed time limit. The Tribunal analyzed the provisions of section 143(2) which required separate notices for limited scrutiny under section 143(2)(i) and regular scrutiny under section 143(2)(ii). The Tribunal held that the notice under section 143(2)(ii) was time-barred as it was served after the specified time limit, rendering the assessment under section 143(3)(ii) null and void. The Tribunal emphasized that limited scrutiny and regular scrutiny proceedings are independent of each other, and the time limits for issuing notices for both types of scrutiny must be adhered to strictly. Therefore, the Tribunal accepted the additional ground raised by the assessee and quashed the assessment.

Outcome:
The Tribunal allowed the appeal filed by the assessee on the basis of the quashed assessment due to the time-barred notice under section 143(2)(ii). As a result, there was no need to delve into the merits of the issue. The appeal was allowed in favor of the assessee, and the assessment under section 143(3)(ii) was declared null and void.