2018 (6) TMI 1666 - HC - Income Tax

Notice u/s 143(2) not served upon the appellant within the period specified under the proviso to subsection (2) of Section 143 - Tribunal cancelled the assessment order - HELD THAT - Commissioner of Income Tax (Appeals) records the fact that besides the return of income indicating the new address, the appellant had by earlier letter dated 6th December, 2005 intimated the change of its address to the Assessing Officer and also requested a issue of fresh PAN. Besides, the Assessing Officer had in fact served at the new address, the assessment order under Section 143(3) of the Act on 30th November, 2006 in respect of Assessment Year 2004-05. This was much prior to the statutory notice issued on 5th October, 2007 and 25th July, 2008 at the address of the respondent as recorded in the PAN. The respondent had taken up the objection with regard to non-service of notice during the assessment proceedings. Thus, as rightly held by the impugned order of the Tribunal that, in view of the proviso to Section 292(BB) of the Act, the notice not being served within time, cannot be deemed to be valid. Therefore, no fault can be found with the impugned order of the Tribunal.

Summary

Issues:
Challenge to order of Income Tax Appellate Tribunal regarding Assessment Year 2006-07 based on validity of assessment order under Section 143(3) of the Income Tax Act, 1961.

Analysis:
The appeal challenges the order of the Income Tax Appellate Tribunal (the Tribunal) dated 19th January, 2015, concerning the Assessment Year 2006-07. The main issue raised is whether the assessment order under Section 143(3) is valid when the notice under Section 143(2) was not served within the specified period. The Tribunal held that the assessment order dated 24th December, 2012, is invalid as the notice under Section 143(2) was not served within the prescribed time limit.

The respondent Assessee had provided a new address in its return of income for Assessment Year 2006-07. However, the Assessing Officer served the notice under Section 143(2) at the address in the PAN record, not the one in the return. The notice sent to the PAN address was not received by the respondent as it was no longer their address. Subsequently, the notice was served beyond the prescribed time limit. The respondent raised objections during the assessment proceedings, but the Assessing Officer proceeded to pass the order under Section 143(3) disregarding the objections.

The Revenue argued that they sent the notice to the address in the PAN records, which they considered correct. They also cited the respondent's participation in the assessment proceedings and invoked Section 292BB of the Act for protection. However, the Commissioner of Income Tax (Appeals) noted that the appellant had previously informed the Assessing Officer of the address change and requested a new PAN. The assessment order for a previous year was correctly served at the new address before the notices sent to the old address. The Tribunal rightly held that the notice not served within the specified time cannot be deemed valid under Section 292BB of the Act.

Consequently, the proposed question of law was deemed not to raise any substantial issue, and the appeal was dismissed without costs.