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2012 (12) TMI 774 - AT - Income TaxDisallowance of Expenses - non discharge on SCN - Held that - The production of books of account and vouchers was not obligatory on the appellant for want of issue and service of notice u/s 143(2). Assessee has failed to produce copy of PAN and also failed to obtain information regarding service of notice sent through Speed Post from Postal Authority. Under the circumstances where the Department in reply to RTI application of the assessee it was clearly stated that the assessee may obtain information from Post Office that on whom this notice was served. These facts clearly show that the assessee has failed to discharge its onus and also failed to rebut the presumptions regarding service of notice. Contrary to this, Revenue has reasonably discharged its onus as per the facts noted above based on which the notice under section 143(2)was sent by Speed Post on the address which is the address in accordance with section 282 - order of CIT(A) is, therefore, set aside and the order of Assessing Officer is restored on the issue. Set aside the finding of CIT(A) in respect of non-issuance of notice under section 143(2) and quashed the assessment, therefore, the CIT(A) is required to give finding after recording complete facts on merit of the case - appeal of the Revenue is allowed and allowed for Statistical purposes.
Issues Involved:
1. Proper appreciation of facts by CIT(A). 2. Quashing of assessment order by CIT(A). 3. Deletion of addition due to non-production of books of account. 4. Validity of service of notice under section 143(2) of the Income Tax Act. 5. Compliance with section 12A of the Income Tax Act. Issue-wise Detailed Analysis: 1. Proper Appreciation of Facts by CIT(A): The Revenue contended that the CIT(A) did not properly appreciate the facts of the case as mentioned in the assessment order. The Departmental Representative argued that the CIT(A) ignored some important facts noted by the Assessing Officer. 2. Quashing of Assessment Order by CIT(A): The CIT(A) quashed the assessment order on the grounds that no notice under section 143(2) was issued and served on the assessee. The CIT(A) found that the notice was not issued to the correct address as given in the return of income but was instead sent to an address mentioned in a TDS certificate. The CIT(A) concluded that the assessment order was in violation of statutory provisions and thus liable to be quashed. 3. Deletion of Addition Due to Non-Production of Books of Account: The CIT(A) deleted the addition of Rs. 2,56,03,033/- made by the Assessing Officer on account of non-production of books of account. The CIT(A) held that the production of books of account and vouchers was not obligatory on the appellant due to the non-issuance and service of notice under section 143(2). The CIT(A) also noted that no such disallowance was made in the previous assessment year 2005-06, which was completed under section 143(3). 4. Validity of Service of Notice under Section 143(2) of the Income Tax Act: The central issue was whether the notice under section 143(2) was properly served. The Department argued that the notice was sent by Speed Post and was not returned undelivered, creating a presumption of service. The address used was from the TDS certificate and PAN, which was the address of the President of the society. The Tribunal noted that the provisions of section 282(1) allow service by post and that there is a presumption of service if the notice is not returned undelivered. The Tribunal found that the assessee failed to rebut this presumption and did not produce evidence to the contrary, such as a copy of the PAN or information from the postal authority. 5. Compliance with Section 12A of the Income Tax Act: The CIT(A) directed the Assessing Officer to allow the benefit under section 11 of the Act, holding that the conditions of section 12A were fulfilled by the assessee. The Tribunal did not address this issue in detail, as it focused on the procedural aspects of notice issuance and service. Conclusion: The Tribunal set aside the order of the CIT(A) regarding the non-issuance and service of notice under section 143(2) and restored the assessment order of the Assessing Officer. The Tribunal remanded the case back to the CIT(A) to decide the issues on merit, providing both parties a reasonable opportunity to be heard. The appeal of the Revenue was allowed for statistical purposes.
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