2024 (5) TMI 744 - AT - Income Tax

Delay in filing the appeal before the CIT(A) - condonation of the delay of 933 days on account of non-receipt of the assessment order - Validity of ex-parte assessment order u/s. 144 r.w.s. 147 - HELD THAT - As perused the affidavit and submission filed by the assessee assessee has received notice of demand on 19.01.2017 and thereafter issued various letters and made correspondence with the AO as mentioned in the submissions of assessee regarding not receiving of ex-parte assessment order dated 27.02.2015 and also not receiving the notice issued u/s. 148 of the Act on the basis of which the case of the assessee was reopened. The assessee has also communicated to the AO by a letter dated 07.02.2017 that he has not received any notice and assessment order for AY 2009-10 and requested the AO to provide the copy of the notice and assessment order so that appeal can be filed before the ld. CIT(A). As perused the copy of the letter of the assessee filed before the AO on 01.12.2023 in which the assessee has categorically brought to the notice of the AO to provide him certified copy of the assessment records for AY 2009-10 including notices issued u/s. 148 and 142(1) reasons recorded for issuing of notice u/s. 148 and date of dispatch of assessment order etc. The assessee has also filed application under RTI Act before the AO for providing information pertaining to service of notices u/s. 148 date of service and issue of assessment order and copy of assessment records for AY 2009-10. As categorically brought to the notice of the ld. D.R. that the assessee has not received the notice issued by the AO pertaining to the assessment made u/s. 144 r.w.s. 147 of the Act in the case of the assessee and directed the ld. D.R. to produce the assessment records on 16.04.2024. However the ld. D.R. has not produced the said records. Therefore on 17.04.2024 the ld. D.R. was again directed to produce the assessment folder for AY 2009-10 on 08.05.2024 and also informed that no further adjournment will be provided. However on the date of hearing of this case the ld. D.R. has neither produced the assessment records nor report about the availability of the assessment records. The aforesaid material facts findings and documents demonstrate that there was bona fide reason for the assessee for delay in filing the appeal since the assessment order and the notice issued on the basis of which the assessment was completed was not received by the assessee. Before the ld. CIT(A) in Form 35 the assessee has categorically submitted that he has neither received the notice issued u/s. 148 and 142(1) show cause notice nor received the reassessment order and also submitted that the order passed by the AO was bad in law and against natural justice. In the light of the above facts and circumstances in the case of the assessee in spite of providing sufficient opportunities the Revenue has failed to produce assessment records to substantiate that notice u/s. 148 of the Act and another notices were issued to the assessee pertaining to the reassessment made in the case of the assessee u/s. 144 r.ws. 147 - In view of the facts findings and circumstances the reassessment order without issuing and servicing of notice u/s. 148 of the Act on the assessee are invalid. Appeal of the assessee is allowed.

Summary

Issues Involved:
1. Delay in filing appeal condonation.
2. Validity of assessment order.
3. Validity of reassessment proceedings.
4. Justification of additions to total income.

Delay in Filing Appeal Condonation:
The appellant sought condonation for delay in filing the appeal due to non-receipt of assessment order until September 2017. The delay was attributed to the appellant not receiving the assessment order, which was supported by a letter filed by the authorized representative. The appellant argued that the delay should be condoned under the circumstances.

Validity of Assessment Order:
The assessment order was challenged as invalid on the grounds that it was not served upon the appellant, rendering it barred by limitation. The appellant contended that the order was invalid as it was not received and served upon them, thus questioning its legal validity.

Validity of Reassessment Proceedings:
The appellant argued that the reassessment proceedings were invalid as they were initiated without proper service of notices under sections 148 and 142(1) of the Act. It was asserted that the notice under section 148 was never served, making the reassessment proceedings invalid. The appellant further contended that the Assessing Officer erred in initiating reassessment without independent application of mind.

Justification of Additions to Total Income:
The appellant challenged the additions made to the total income, arguing that the Assessing Officer could not have made these additions without providing adequate opportunity for the appellant to be heard. It was further contended that the additions were made without proper application of mind, solely relying on the investigation report of the sales-tax department.

The Tribunal found that the appellant had valid reasons for the delay in filing the appeal, as the assessment order and notice under section 148 were not received by the appellant. Despite providing opportunities, the Revenue failed to produce assessment records to substantiate the issuance and service of the notice under section 148. Consequently, the reassessment proceedings were deemed invalid, and the appeal of the appellant was allowed. The Tribunal quashed the reassessment proceedings, leaving the merit of the addition to total income open for further consideration.