2017 (7) TMI 1152 - AT - Income Tax

Reopening of assessment - non issue of notice - is sec 292BB is applicable to the impugned assessment or not? - Held that - the only remedy in case of non service of notice u/s. 148(1), or where an objection/s in respect of its service has been raised before the completion of assessment u/s. 147, and which is found valid by an appellate forum, is to restore the matter for proper service of notice as per law. Rather, such a situation may not practically arise. This is as where an objection qua service of notice u/s. 148 is raised before the AO, he would, rather than disputing the same, accepting the same, cause the service of notice. It is the assessee on whom the burden lies to exhibit, at least prima facie, that the apparent is not real, and that, though signed, the AO retained control over the notice and was not put in the process of its service. An objection by the assessee qua service of notice, which s. 292BB seeks to regulate, implies a disputed set of facts, and not an admitted fact on the basis of which no jurisdiction stands assumed. Sec. 292BB is squarely applicable in the present case, precluding the assessee from raising any objection with regard to the service of notice u/s. 148(1). The decision by the ld. CIT(A) is accordingly upheld, dismissing the assessee s Grounds 1.1 to 1.4.

Issues Involved:
1. Validity of reassessment proceedings due to non-service of notice under Section 148.
2. Applicability of Section 292BB of the Income Tax Act, 1961.
3. Issuance of notice under Section 148 within the prescribed time limit.

Detailed Analysis:

1. Validity of Reassessment Proceedings Due to Non-Service of Notice Under Section 148:

The appellant contended that no notice under Section 148 of the Income Tax Act was served, rendering the reassessment invalid. The Commissioner of Income Tax (Appeals) dismissed this plea, citing Section 292BB, which deems that if an assessee has participated in proceedings, they cannot later contest the service of notice. The Tribunal upheld this view, noting that the appellant did not raise any objections during the assessment proceedings, thus precluding them from challenging the notice's service later.

2. Applicability of Section 292BB of the Income Tax Act, 1961:

The appellant argued that Section 292BB, introduced by the Finance Act, 2008, is prospective and applies only to proceedings from AY 2008-09 onwards. The Tribunal, referencing the CBDT Circular 1 of 2009 and the decision in Panchvati Motors (P.) Ltd., clarified that Section 292BB applies to all proceedings pending as of 01.04.2008, regardless of the assessment year. The Tribunal emphasized that the provision restricts the right to object to service of notice from 01.04.2008 onwards, irrespective of the assessment year involved.

3. Issuance of Notice Under Section 148 Within the Prescribed Time Limit:

The appellant raised a fresh objection, claiming the notice under Section 148 was not validly issued as it did not leave the control of the issuing officer. The Tribunal examined various documents provided by the Revenue, including system-generated reports and the notice itself, and concluded that the notice was indeed issued on 31.03.2012. The Tribunal found no reason to doubt the authenticity of these documents, dismissing the appellant's claim.

Conclusion:

The Tribunal upheld the applicability of Section 292BB, precluding the appellant from contesting the service of notice under Section 148 after participating in the proceedings. It also confirmed the valid issuance of the notice within the prescribed time limit. Consequently, the appellant's grounds were dismissed, and the appeal was rejected.

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