2023 (3) TMI 1561 - AT - Income Tax

Validity of the assessment order framed u/s 143(3) - notice u/s 143(2) being jurisdictional requirement was served beyond the stipulated time provided therein - HELD THAT - Undeniably it was holiday dated 30 September 2018 being Sunday which was also the last working day for the service of notice under the provisions of section 143(2) of the Act for the year under consideration. If last working day happens to be a holiday then the authorities concerned have been given power to make the necessary compliance on the next working day. Thus apparently it appears that the AO has made sufficient compliance by issuing the notice on the next working day being 1 October 2018 despite the fact that the office of the income tax was operational dated 30 September 2018 and the notice was digitally sign by the AO on 30 September 2018. To our understanding the Sunday being a holiday cannot be assumed or working day like any other day of the work. In-fact the officers were working even on the Sunday for the reason that there was cut-off date for framing the assessment as well as for filing the income tax return. In other words there was more workload on the Government Officers and therefore they had to work even on the holiday. But that does not mean that such holiday shall be presumed as a working day like any other normal day. The object of working on the holiday was to reduce the workload. Thus the benefit granted under the General Clause Act as discussed above cannot be deprived to the Revenue. Accordingly we hold that the notice though digitally signed on 30 September and the same was put to service dated 1 October 2018 has been served after the sufficient compliance under the law and therefore in the given facts and circumstances the assessment framed cannot be held as not maintainable - Appeal filed by the assessee is hereby dismissed.

Summary

The appeal before the Appellate Tribunal concerned the validity of an assessment order passed under section 143(3) of the Income Tax Act, 1961 for the Assessment Year 2017-18. The core issue revolved around the timing of the notice served under section 143(2) of the Act, with the assessee contending that the notice was not served within the statutory time limit as required by law.The assessee argued that the notice under section 143(2) should have been served before the stipulated time of 30 September 2018, but it was actually served on 1 October 2018. The assessee claimed that this delay rendered the assessment framed under section 143(3) invalid and not maintainable.The Commissioner of Income Tax (Appeals) rejected the assessee's contention, citing legal principles from the General Clauses Act. The Commissioner noted that when a due date falls on a holiday, compliance on the next working day is considered sufficient. In this case, since 30 September 2018 was a Sunday, and the notice was served on 1 October 2018, it was deemed compliant with the law.The Appellate Tribunal upheld the decision of the Commissioner, emphasizing that the notice was digitally signed on 30 September 2018, and the service on 1 October 2018 was within the legal framework provided by the General Clauses Act. The Tribunal reasoned that the officers were working on the holiday due to the workload, but this did not transform the holiday into a regular working day. Therefore, the assessment was deemed valid and maintainable.In conclusion, the Appellate Tribunal dismissed the appeal filed by the assessee, affirming the validity of the assessment order. The Tribunal's decision was based on the application of the legal principles outlined in the General Clauses Act regarding the computation of time when a due date falls on a holiday.