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2014 (7) TMI 220 - HC - Income TaxValidity of notice served u/s 143(2) Time-barred notice - regular assessment / scrutiny assessment u/s 143(3) Held that - The Tribunal rightly held that the requirement of law is notice to be served - There is no deeming provision under the Act - It is because no acknowledgement was received after issuing of a notice, the authority himself has sent a second notice on 22.7.2005 the notice is sent beyond the period of limitation, thus, time barred - the assessing authority had no jurisdiction to frame the assessment the order of the Tribunal is upheld Decided against Revenue.
Issues:
Validity of assessment order based on service of notice under Section 143 of the Income Tax Act, 1961. Analysis: The appeals were filed against the Tribunal's order setting aside the assessment order due to improper service of notice under Section 143 of the Income Tax Act. The assessee had filed the income tax return within the prescribed period. The assessing officer issued a notice under Section 142(2) on 15.10.2004, dispatched on 3.11.2004. As the acknowledgment was not received, a second notice was issued on 22.7.2005, which was served on the assessee. The assessee contended that the second notice was time-barred, but the assessing authority rejected this argument, stating that the first notice was issued on time. The assessment was then framed without acknowledgment of service. The assessee appealed to the Commissioner of Income Tax (Appeals), who upheld the notice's validity but only allowed a small amount of deductions. Both the assessee and the revenue appealed to the Tribunal. The Tribunal held that the law requires proper service of notice, and there is no deeming provision under the Act. Since no acknowledgment was received for the first notice, the assessing authority sent a second notice beyond the limitation period. The Tribunal concluded that the authority lacked jurisdiction to frame the assessment, ruling in favor of the assessee and dismissing the revenue's appeal. The High Court found no fault in the Tribunal's decision, stating it was in accordance with the law and did not warrant any interference. Consequently, the appeals were dismissed, upholding the Tribunal's ruling that the notice was time-barred, and the assessment was invalid.
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