2017 (2) TMI 582 - HC - Income Tax

Invalid notice under Section 143(2) - scrutiny assessment - Held that - The impugned order of the Tribunal renders a finding of fact that the notice under Section 143(2) has not been served at the correct address on or before 30th November, 2007 which is not shown to be incorrect. It follows that Assessment proceedings concluded on the basis of such invalid notice is void. In the above view, as the position is self evident on a plain reading of Section 143(2) of the Act read with Section 127 of the General Clauses Act, thus no substantial question of law arises for our consideration.

Summary

Issues:
Challenge to order under Section 260A of the Income Tax Act, 1961 for Assessment Year 2006-07. Interpretation of Section 143(2) regarding notice service and limitation period.

Analysis:
The High Court was presented with the issue of whether the service of notice under Section 143(2) of the Income Tax Act was justified in this case. The respondent-assessee had changed their address, informing the Assessing Officer on 23rd November, 2006. However, the notice under Section 143(2) was sent to the old address on 30th November, 2007, and later to the correct address on 11th December, 2007. The Tribunal held that the notice should have been served within 12 months from the date of filing the return, which was not done in this case. The Court agreed that the notice served at the old address did not meet the statutory requirements, rendering the assessment proceedings void.

The Revenue argued that the notice given to the post office on 30th November, 2007 should be considered as the date of service to the assessee, but the Court found that the notice was incorrectly addressed to the old office. The Court referred to Section 282 of the Act and Section 27 of the General Clauses Act, stating that the presumption of service by post could not be invoked due to the incorrect address. The subsequent correct service on 11th December, 2007 was based on the information already available with the Assessing Officer since 2006, and no new address was provided in the interim. As the objection to the assessment was raised before completion, the Assessment Order could not be saved by Section 292BB of the Act.

The Court upheld the Tribunal's decision, emphasizing that the notice under Section 143(2) was not served at the correct address within the prescribed time limit, making the assessment proceedings invalid. The judgment concluded that no substantial question of law arose, and the appeal was dismissed without costs.