2020 (4) TMI 233 - HC - Income Tax

Reopening of assessment u/s 147 - no service of notice u/s 148 - HELD THAT - None of the notices were returned by the postal authorities as unserved for want of complete or correct address the presumption of bonafide as obtaining in favour of the State would hold the ground. In any case, the appellant has received the notices sent by the Ld. AO on that same address as late as May 2017 and it cannot claim that the address was incorrect or incomplete. In view of the admission of the appellant the claim of the appellant that it did not receive the notices issued by the Ld. AO because of the address on which the said notices were sent by the Ld. AO was either incomplete or incorrect is not tenable Whether additional/fresh evidence was taken into consideration by the Commissioner of Income Tax (Appeals)? - HELD THAT - AO by its report dated 26.03.2018 submitted its response to the fresh evidence of the appellant and rejected the same and recommended that the grounds raised by the appellant were neither maintainable nor acceptable in the eyes of the law and the appeal of the appellant deserved to be dismissed by this office. No substantial question(s) of law

Summary

Issues:
1. Service of notice under section 148 of the Income Tax Act, 1961.
2. Consideration of additional/fresh evidence by the Commissioner of Income Tax (Appeals)I.

Analysis:
1. Service of Notice under Section 148:
The appellant contended that the address on which the notices were sent by the Assessing Officer (AO) was incorrect, raising doubts about the service of notice under section 148 of the Income Tax Act, 1961. However, the Commissioner of Income Tax (Appeals)-I found that the appellant himself admitted to receiving a notice at the same address in May 2017, indicating that the postal authorities had successfully served notices on that address. The Commissioner held that since none of the notices were returned unserved, the presumption of bonafide service in favor of the State was valid. The appellant's claim of not receiving notices due to an incomplete or incorrect address was deemed untenable based on the evidence provided.

2. Consideration of Additional/Fresh Evidence:
The appellant submitted fresh evidence, which the AO rejected in a report dated 26.03.2018. The AO recommended dismissing the appellant's appeal, stating that the grounds raised were neither maintainable nor acceptable under the law. The Commissioner of Income Tax (Appeals)-I upheld this decision, indicating that the fresh evidence was not considered valid for the appeal. The Tribunal, in its judgment and order dated 3rd October, 2019, took into account both the issues raised by the appellant. However, the High Court, in its analysis, found that these issues were primarily factual in nature and did not constitute substantial questions of law. Consequently, the appeal was dismissed as the issues were deemed factual rather than legal, leading to the rejection of the appeal.

In conclusion, the High Court dismissed the appeal under section 260A of the Income Tax Act, 1961, as the questions raised by the appellant were considered factual rather than substantial questions of law. The judgment highlighted the importance of proper service of notices and the admissibility of fresh evidence in tax appeal proceedings.