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2017 (11) TMI 1079 - AT - Income TaxValidity of assessment - non issue of statutory notice u/s 143(2) - filing of the ROI by way of letter by the assessee - Held that - On perusal of the order sheet entries made from 20.03.2014, it is clear that no notice under section 143(2) of the Income Tax Act, 1961 (Act) was issued to the assessee. The submission of the learned DR that the assessee did not file a return of income and hence no notice is required to be issued under section 143(2) of the Income Tax Act, 1961 (Act) is factually incorrect. The assessee had filed its return of income. - Decided in favour of assessee.
Issues Involved:
1. Validity of the reassessment order due to non-issuance of notice under Section 143(2) of the Income Tax Act, 1961. Detailed Analysis: 1. Validity of the Reassessment Order: - Legal Ground for Appeal: The assessee challenged the jurisdiction of the Assessing Officer (AO) on the basis that no statutory notice under Section 143(2) of the Income Tax Act, 1961 was issued before passing the reassessment order dated 30th March 2015. This was claimed to render the reassessment order void ab initio. - Admittance of Additional Ground: The Tribunal admitted this additional ground following the precedent set by the Hon’ble Supreme Court in the case of NTPC Ltd., as all necessary facts were available on record. - Assessment Records Review: Upon reviewing the assessment records, it was confirmed that no notice under Section 143(2) was issued to the assessee. The Departmental Representative’s claim that no notice was required because the assessee did not file a return of income was factually incorrect; the assessee had indeed filed a return. - Relevant Case Law: - Ms. Meenakshi Aggarwal: It was established that the issue of notice under Section 143(2) is mandatory even in reassessment proceedings initiated under Section 148. - Shri G.N. Mohan Raju vs ITO: The Delhi High Court in M/s. Alpine Electronics Asia PTE Ltd. and the Apex Court in Hotel Blue Moon held that Section 143(2) applies to reassessment proceedings under Section 147/148, making the issuance of such notice mandatory. The Madras High Court’s view that it was procedural was not upheld. - Naseman Farms Pvt. Ltd.: The Tribunal emphasized that non-issuance of notice under Section 143(2) renders the reassessment invalid. - Hotel Blue Moon: The Supreme Court ruled that the issuance and service of notice under Section 143(2) is mandatory and not merely procedural. Non-compliance invalidates the assessment order. - Tribunal’s Conclusion: Based on the above precedents, the Tribunal held that the non-issuance of notice under Section 143(2) after the filing of the return by the assessee rendered the reassessment order passed under Section 143(3) read with Section 147 invalid and void ab initio. Consequently, the reassessment proceedings were quashed. - Other Grounds: Since the reassessment was quashed on jurisdictional grounds, other grounds raised by the assessee were deemed academic and not adjudicated. Outcome: - The appeal filed by the assessee was allowed. - The reassessment orders were quashed due to the non-issuance of mandatory notice under Section 143(2), rendering them invalid and void ab initio. Final Pronouncement: - The order was pronounced in the open court on 17th November 2017.
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