2021 (10) TMI 1369 - HC - Income Tax

Assessment u/s 153A - Tribunal justification in holding that Section 143(2) notice is not required to be issued in the case of an assessment under Section 153A - HELD THAT - It the very argument of the assessee that the explanation to a statutory provision may fulfill the purpose of clearing up the ambiguity or can t add to or widen the scope of the main section thereby the procedure in the assessment under Section 153A is as otherwise provided in this Section is not a complete legal argument by applying explanation to Section 153A of the Act. The argument of assessee as pointed out by Mr.P.K.R Menon ignores the presence of the words save as otherwise provided in this Section i.e. Section 153A . The plain reading of explanation leads to the very same conclusion as reached in the reported cases in Tarsem Singla 2016 (7) TMI 703 - PUNJAB AND HARYANA HIGH COURT and Promy Kuriakose 2016 (8) TMI 327 - KERALA HIGH COURT . The explanation in the final analysis of the scheme of Section 153A does not in any manner expand the meaning including the requirement of Section 143 (2) of the Act. For the above reasons and discussions the questions are answered against the assessee and in favour of the revenue.

Summary

Issues:
1. Interpretation of Section 143(2) notice requirement in assessment under Section 153A of the Income Tax Act.
2. Validity of assessment completed under Section 153A read with Section 143(3) due to a time-barred notice under Section 143(2).
3. Applicability of case law in a distinct factual scenario.
4. Correct interpretation of Section 153A and Section 143 in assessment proceedings.
5. Denial of effective opportunity to distinguish decisions relied on by the Tribunal.
6. Assessment validity based on factual and legal aspects.

Analysis:

Issue 1:
The appellant challenged the requirement of a Section 143(2) notice in Section 153A assessments. The Tribunal relied on precedents, including Ashok Chaddha case, to support the view that such notice is not mandatory under Section 153A.

Issue 2:
The appellant contended that a time-barred notice under Section 143(2) rendered the assessment under Section 153A void ab initio. However, the Tribunal's reliance on case law and the exclusion of Section 143(2) requirements in Section 153A assessments supported the validity of the assessment.

Issue 3:
The appellant argued against the applicability of the Ashok Chaddha case to their case, citing factual distinctions. However, the Tribunal found the principles laid down in Ashok Chaddha case to be relevant and applicable to the present scenario.

Issue 4:
The appellant raised concerns regarding the interpretation of Section 153A and Section 143 in the assessment process. The Tribunal upheld the completeness of the assessment procedure under Section 153A, dismissing the appellant's argument on the requirement of a Section 143(2) notice.

Issue 5:
The appellant alleged denial of an effective opportunity to distinguish the decisions relied upon by the Tribunal. However, the Tribunal's decision was based on established case law principles and the legal interpretation of relevant sections, leading to the dismissal of the appeals.

Issue 6:
The assessment's validity was challenged based on factual and legal aspects. The Tribunal's analysis emphasized the procedural completeness under Section 153A, rejecting the appellant's arguments on the necessity of a Section 143(2) notice. The appeals were consequently dismissed in favor of the revenue.