9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (12) TMI 1080 - AT - Income TaxValidity of assessment - non issuance of notice u/s 143(2) - Whether curable defect u/s 292BB? - HELD THAT - As decided in Laxman Das Khandelwal case 2019 (8) TMI 660 - SUPREME COURT for section 292BB to apply, section 143(2) notice must have emanated from the department and it is only infirmities in the manner of service of notice that the section seeks to cure and it is not intended to cure the complete absence of notice under section 143(2) of the Act itself. Thus the entire reassessment proceedings under section 143(3) read with section 147, in the present case, stood vitiated as the AO lacked jurisdiction in absence of notice u/s 143(2) of the Act. Hence, the assessment order passed under section 143(3) read with section 147 of the Act is quashed. - Decided in favour of assessee.
Issues involved:
Validity of notice u/s 143(2) for assessment proceedings, Challenge to initiation of reassessment proceedings under section 147, Additions made by the Assessing Officer Validity of notice u/s 143(2) for assessment proceedings: The appeal challenged the validity of the assessment proceedings due to the absence of a notice under section 143(2) of the Income Tax Act. The Revenue argued that the participation of the assessee in the proceedings waived the requirement of the notice under section 143(2) as per section 292BB. However, the Appellate Tribunal noted that the absence of the notice itself cannot be cured by section 292BB. Citing the Supreme Court's decision in CIT vs Laxman Das Khandelwal, the Tribunal emphasized that section 292BB only addresses infirmities in the service of notice and does not cure the complete absence of notice under section 143(2). As the department failed to produce the notice or provide details, the Tribunal held that the assessment proceedings were null and void without the requisite notice. Consequently, the assessment order under section 143(3) read with section 147 was quashed, and the appeal on this ground was allowed. Challenge to initiation of reassessment proceedings under section 147: The assessee contested the initiation of reassessment proceedings under section 147 of the Act. The Appellate Tribunal upheld the initiation of reassessment proceedings, stating that the AO had jurisdiction to proceed under section 147 based on information received regarding fictitious profits and losses misused by some brokers, including the assessee. The Tribunal found the initiation of reassessment proceedings valid in this context. Additions made by the Assessing Officer: The Assessing Officer made additions to the assessee's income, including an alleged bogus loss and commission paid on the fictitious loss. The Appellate Tribunal reviewed the additions but did not delve into a detailed analysis as the assessment order was quashed solely based on the absence of the notice under section 143(2). Since the assessment order was set aside, the Tribunal did not provide a specific ruling on the additions made by the Assessing Officer, keeping those issues open for future consideration. In conclusion, the Appellate Tribunal allowed the appeal by the assessee, quashing the assessment order due to the absence of a notice under section 143(2) of the Act. The Tribunal emphasized the importance of proper notice issuance and clarified that section 292BB does not cure the complete absence of notice. As a result, the other issues raised in the appeal, including challenges to the initiation of reassessment proceedings and additions made by the Assessing Officer, were left unresolved for future consideration.
|
