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2012 (4) TMI 286 - HC - Income TaxValidity of notice issued u/s 142(1) dated 05.08.2011 for AY 2004-05 assessee contests notice issued u/s 142(1) on ground of non-serving of notice u/s 148 dated 22.03.2011 - notice u/s 148 issued at old address - petitioner vide his letter in February 2006 informed A.O. about change in address filed returns of subsequent AYs stating new address Held that - Petitioner was aware and knew that the A.O. has issued the notice u/s 148 at the address mentioned in the return. A clear distinction between issue and service of the notice has been drawn in case of R K Upadhyaya Vs. Shanabhai P. Patel (1987 (4) TMI 5 - SUPREME Court - Income Tax). Issue of notice within the prescribed time is a mandatory requirement and service of notice is a procedural requirement before completing the assessment. In these circumstances, the assessee can be treated as served with the notice u/s 148, which was earlier issued at the address mentioned in the return Decided against the assessee.
Issues:
Quashing of notice under Section 142(1) of the Income Tax Act, 1961 for assessment year 2004-05 due to non-service of notice under Section 148 of the Act. Analysis: The petitioner, a company, filed a writ petition seeking to quash the notice dated 5.8.2011 under Section 142(1) of the Income Tax Act, 1961, for assessment year 2004-05, alleging non-service of the notice under Section 148 dated 22.3.2011. The petitioner claimed that the proceedings based on the notice under Section 142(1) were void ab initio due to non-service of the Section 148 notice. The petitioner asserted that they had informed the Assessing Officer about a change of address to X-1, Okhla Industrial Area, but the notice was sent to the old address. The Revenue argued that the notice was sent to the address mentioned in the return and relied on income tax website data showing the old address. The court noted that the petitioner did not dispute receiving the notice at the old address, emphasizing the distinction between "issue" and "service" of notice as per Supreme Court precedents. The court rejected the Revenue's argument that they are not required to verify addresses beyond the income tax website data. It emphasized that the Assessing Officer should verify new addresses from subsequent returns and records. The court cited a Supreme Court decision highlighting the importance of issuing notices within the prescribed time, making it a jurisdictional requirement. The court clarified that Section 149 of the Act mandates the "issue of notice" and not the "service of notice," unlike the previous Income Tax Act, 1922. The court highlighted that the petitioner's awareness of the notice issued at the old address indicated their knowledge of the proceedings, allowing them to proceed with filing returns. The court acknowledged that the assessment proceedings were ongoing and the petitioner was aware of them. It noted that non-receipt or non-service of the notice by post was inconsequential in this case. The Revenue's argument that the notice was not returned unserved was countered by the petitioner's claim of a change in address. The court dismissed the petitioner's plea to quash the proceedings, allowing them to file returns considering the notice under Section 148 as served. The court declined to base its decision on post-filing enquiries by the Revenue, concluding that there was no merit in quashing the proceedings. In conclusion, the court disposed of the writ petition, granting the petitioner liberty to file returns based on the deemed service of the notice under Section 148. No costs were awarded in the matter.
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