2015 (6) TMI 897 - AT - Income Tax

Service of notice u/s 148 by affixture - Held that - The notice server of the department had affixed the notice u/s 148 of the Act on the address given in the return of income i.e. Jyoti Nagpal, Tagore Garden, New Delhi with the remarks that Makan Khali Para Hai, ab yahan nahi rahti notice chipka diya gaya . We also find from the Page No.13 of the Paper Book filed by the department that the notice u/s 142 sent by speed post on 1.12.2008 received by the appellant on 06.12.2008. We fail to understand when the house was vacant in the month of January, 2008 how same person was residing at the same address in the month of December, 2008. This goes to prove that the appellant is determined to decline to accept the notice. We are further strengthened in taking the view by the fact that the appellant never brought on record as to how he had come to know of the passing of the assessment order against which he had pursued the legal remedies available under the Act within the stipulated time. In other words there was due service of notice u/s 148 upon the appellant by refusal. As relying on Jagdish Singh Vs. Natthu Singh reported in 1991 (11) TMI 246 - SUPREME COURT held that when a notice is sent by registered post and is returned with a postal endorsement refused or not available in the house or house locked or shop closed or addressee not in station , due service has to be presumed. Similarly, when the notice server affixed notice on the last known address with the remark that not available in the house, on the same analogy, it has to be presumed that notice was served properly. The case laws cited by the Ld. AR are of not any help in the facts of the case. - Decided against assessee. Addition u/s 69 - rejection of accpting additional evidence by CIT(A) - Held that - It was only during the course of the proceedings before the CIT(A) the appellant made attempt to file the confirmation letter from Mr. Satish Kumar as additional evidence without even filing an application for admission of such additional evidence as required under Rule 46A of the IT Rules. Therefore, the CIT(A) was justified in not taking cognizance of such additional evidence. No explanation on the record explaining the sources for the cash deposited in the Bank account of the assessee on 17.04.2012. The appellant miserably failed to discharge the onus that was lying upon him under the provisions of the Section 69 of the Act. Therefore, we hereby confirm the addition of ₹ 3,30,000/- made by the Assessing Officer. - Decided against assessee.

Summary

Issues:
1. Proper adjudication of the issue relating to alleged service of notice by affixture.
2. Challenge of the addition made under Section 68 of the Income Tax Act, 1961.
3. Proper consideration of written submissions and case laws during appeal proceedings.
4. Validity of the initiation and service of notice under Sections 148 and 142(1) of the Act.

Issue 1: Proper adjudication of the issue relating to alleged service of notice by affixture:
The appellant raised concerns regarding the service of notice by affixture, arguing that it was invalid and illegal. The appellant contended that the Commissioner of Income Tax (Appeals) did not properly consider the issue and relied on the remand report of the Assessing Officer without due consideration of facts and written submissions. The appellant cited provisions from the IT Act, 1961, and the Civil Procedure Code, 1908, to support the claim that the service of notice by affixture was against the law. However, the Tribunal found that there was proper service of notice under Section 148 of the Act, as evidenced by the notice server affixing the notice at the address mentioned in the return of income. The Tribunal relied on legal precedents to establish that when a notice is sent and returned with a postal endorsement of refusal, due service is presumed. Therefore, the Tribunal dismissed the appellant's challenge on the service of notice by affixture.

Issue 2: Challenge of the addition made under Section 68 of the Income Tax Act, 1961:
The appellant contested the addition of Rs. 3,30,000 made by the Assessing Officer under Section 68 of the Income Tax Act, 1961. The appellant argued that the amount was received by cheque, proving the identity of the creditor. However, the Tribunal noted that the appellant failed to comply with the statutory notices issued under Sections 148 and 142 of the Act, leading to an ex-parte assessment. The appellant attempted to file additional evidence during the proceedings before the CIT(A) without following the required procedure under Rule 46A of the IT Rules. As a result, the Tribunal upheld the addition of Rs. 3,30,000, as the appellant could not provide a satisfactory explanation for the cash deposited in the bank account. The Tribunal confirmed the decision of the Assessing Officer regarding the addition under Section 68.

Issue 3: Proper consideration of written submissions and case laws during appeal proceedings:
The appellant raised concerns that the CIT(A) did not adequately consider the written submissions and case laws presented during the appeal proceedings. However, the Tribunal found that there was no ground challenging the refusal of the CIT(A) to admit additional evidence. As a result, the Tribunal upheld the decision of the CIT(A) not to consider the additional evidence presented by the appellant. The Tribunal emphasized that the appellant failed to discharge the onus placed on them under Section 69 of the Act, leading to the confirmation of the addition made by the Assessing Officer.

Issue 4: Validity of the initiation and service of notice under Sections 148 and 142(1) of the Act:
The appellant contested the validity of the initiation and service of notice under Sections 148 and 142(1) of the Act. However, the Tribunal found that there was proper service of notice under Section 148, and the appellant's refusal to accept the notice did not invalidate the service. The Tribunal also noted that the appellant did not provide any explanation for how they learned of the assessment order if they were not accepting the notices. Therefore, the Tribunal concluded that there was due service of notice upon the appellant by refusal. The Tribunal dismissed the appellant's challenge regarding the initiation and service of notice under Sections 148 and 142(1) of the Act.

In conclusion, the Tribunal dismissed the appeal filed by the assessee, upholding the decisions made by the Commissioner of Income Tax (Appeals) and the Assessing Officer regarding the issues raised concerning the service of notice by affixture and the addition made under Section 68 of the Income Tax Act, 1961. The Tribunal found that the appellant failed to provide sufficient evidence or explanations to warrant a reversal of the decisions made during the assessment proceedings.