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2022 (4) TMI 225 - AT - Income TaxValidity of assessment - non issuance of notice u/s 143(2) - HELD THAT - DR could not file any case records before us about the Assessing Officer having issued the corresponding section 143(2) notice to the assessee. We make it clear that the instant issue stands of non issuance of such a notice settled by the hon'ble apex court in Laxmandas Khandewal 2019 (8) TMI 660 - SUPREME COURT that the same is very much mandatory condition for framing of a valid assessment. We thus find no substance in Revenue's vehement contention seeking to revive the impugned assessment in foregoing terms. The Revenue's instant sole substantive ground as well stand rejected.
Issues Involved:
1. Validity of the assessment order due to the absence of a valid Section 143(2) notice. Detailed Analysis: Issue 1: Validity of the Assessment Order Due to Absence of a Valid Section 143(2) Notice Background: The Revenue's cross appeal challenged the correctness of the CIT(A)'s action quashing the impugned assessment for want of a valid Section 143(2) notice. Findings: - The CIT(A) observed that the AO mentioned issuing notices under Sections 143(2) and 142(1) on 14.12.2011, but no such notice was found in the order sheet, nor was there any evidence of its service. The AO admitted that evidence of service was not readily available. - The CIT(A) concluded that the absence of a valid Section 143(2) notice rendered the assessment order legally infirm and invalid. Relevant Case Laws: 1. ACIT vs. Hotel Blue Moon (321 ITR 362 SC): - The Supreme Court held that service of notice under Section 143(2) within the prescribed time is a prerequisite for framing block assessments under Chapter XIV-B. - The omission to issue a notice under Section 143(2) is not a procedural irregularity but a jurisdictional defect that cannot be cured. 2. CIT vs. Mukesh Kumar Agarwal (345 ITR 29 Allahabad): - The High Court reiterated that the issuance of a notice under Section 143(2) is foundational for jurisdiction. Section 292BB cannot cure the defect of non-issuance of such notice. 3. CIT vs. Salarpur Storage Ltd (228 Taxmann 48 Allahabad): - The High Court held that the issuance of a notice under Section 143(2) is mandatory for assuming jurisdiction. Failure to issue such notice within the prescribed period invalidates the assessment. 4. Pr. CIT vs. Silver Line (383 ITR 455 Delhi): - The High Court distinguished between the failure to issue and the failure to serve a notice. Section 292BB applies to defects in service, not issuance. The absence of a Section 143(2) notice invalidates the reassessment proceedings. 5. CIT vs. Cebon India Ltd (347 ITR 538 P&H): - The High Court held that the absence of a notice under Section 143(2) within the stipulated time renders the assessment void, and Section 292BB cannot cure this defect. 6. M/s. Sanjeev Agarwal vs. DCIT (159 ITD 302 Chandigarh Tribunal): - The Tribunal held that the absence of a Section 143(2) notice is a jurisdictional error that Section 292BB cannot cure. 7. M/s. Alok Mittal vs. DCIT (167 ITD 325 Kolkata Tribunal): - The Tribunal reiterated that the failure to issue a Section 143(2) notice before completing the assessment is a jurisdictional defect that cannot be cured by Section 292BB. 8. M/s. Travancore Diagnostics P. Ltd. vs. ACIT: - The Kerala High Court held that the issuance of a Section 143(2) notice is mandatory, and its absence invalidates the assessment proceedings. 9. ACIT, Thirupathi vs. Dr. N. Madhava Reddy (ITA No. 1897/Hyd/2011): - The ITAT held that an assessment under Section 143(3) cannot be passed without a valid Section 143(2) notice. Conclusion: The Tribunal upheld the CIT(A)'s decision, concluding that the absence of a valid Section 143(2) notice rendered the assessment invalid. The Revenue's appeal was dismissed, and the assessee's appeal was dismissed as not pressed. Final Order: - The Revenue's cross appeal (ITA No. 467/Hyd/2020) was dismissed. - The assessee's appeal (ITA No. 409/Hyd/2020) was dismissed as not pressed. Pronouncement: The order was pronounced in the Open Court on 21st March 2022.
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