9911796707
TMI Blog2011 (12) TMI 426X X X X Extracts X X X X X X X X Extracts X X X X ..... where it was categorically held that the communication is a condition precedent to an order of assessment becoming effective. Thus, the impugned orders passed by the ld. CIT(A) are perfectly valid and sustainable for legal scrutiny. Thus, upheld. Decision in favour of Assessee. - ITA No.409,410,411/CTK/2011 and C.O.Nos.30,31 and 32/CTK/2011 - - - Dated:- 22-12-2011 - Order All these appeals are filed by the Department, whereas the cross-objections are filed by the assessee on the order of the Commissioner of Income-tax (Appeals) for the assessment years 2002-03, 2003-04 and 200405 in the case of the assessee. The Department has raised the following issues in all these appeals uniformly. "1. The learned Commissioner of Income-tax (Appeals) was not at all justified to hold that the assessment order made on December 29, 2009, along with the demand notice dated December 29, 2009, was barred by limitation under section 153(1) of the Income-tax Act on the ground that such order and demand notice was not served on the assessee within the period of limitation as prescribed under section 153(1) of the Income-tax Act, 1961. 2. The learned Commissioner of Income-tax (Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ] 166 ITR 163 (SC) in which the hon'ble court has made a clear distinction between 'issue of notice' and 'service of notice' and also has laid down the principle that service of notice under the Income-tax Act, 1961 is not a condition precedent to conferment of jurisdiction on the Income-tax Officer to deal with the matter but is a condition precedent to the making of the order of assessment. The learned Commissioner of Income-tax (Appeals) failed to apply such basic principle of the statutory provisions of section 153(1) regarding making an assessment order and service of the assessment order within the prescribed period of limitation. 9. The learned Commissioner of Income-tax (Appeals) was also in error to totally ignore the ratio of the decision given by the hon'ble Andhra Pradesh High Court in the case of Kodidasu Appalaswamy and Suryanarayana v. CIT reported in [1962] 46 ITR 735 (AP) in which their Lordships had held-where an order of assessment has been passed within the period of limitation the date on which the order of assessment and demand notice is served is not at all material. 10. The learned Commissioner of Income-tax (Appeals) was also not justified to ignore the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scrutiny and assessment orders were passed. Aggrieved by those assessment orders, the assessee went in appeal before the learned Commissioner of Income-tax (Appeals) and got relief. The Assessing Officer has reopened the assessments under section 148 giving necessary statutory notices and raised demand against the assessee. Later on the cases were transferred to the Assistant Commissioner of Income-tax, Circle 2(2), Cuttack by jurisdictional order passed by the Assistant Commissioner of Income-tax dated June 12, 2009. Accordingly notice under section 142(1) was issued and served on the assessee but there was no response from the assessee. Later on the Assessing Officer initiated penalty proceedings under section 271(1)(b) of the Income-tax Act for the failure on the part of the assessee to comply with the statutory notice. Thereafter the Assessing Officer decided to make the assessment under section 144/147 for all these assessment years passing the assessment orders. Aggrieved by these assessment orders, the assessee went in appeals before the Commissioner of Income-tax (Appeals) and the learned Commissioner of Income-tax (Appeals) after hearing the assessee and considering t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has contended that the citations relied on by the learned Departmental representative are not at all applicable to the facts of the present cases on hand as they are distinguishable on facts. Thus contended, he distinguished the facts of those cases from the cases on hand. He further submitted that the orders of the learned Commissioner of Income-tax (Appeals) are well reasoned and in accordance with the judicial pronouncements relied on by the learned Commissioner of Income-tax (Appeals) and hence, the impugned orders of the learned Commissioner of Income-tax (Appeals) do not infirm in any way requiring interference since the citations relied on by the learned Departmental representative are distinguishable on facts and cannot be applicable to the facts of the present cases. Therefore, he sought for upholding the orders of the learned Commissioner of Income-tax (Appeals) by dismissing the appeals of the Department and allowing the cross-objections filed by the assessee. On careful analysis of the impugned orders passed by the learned Commissioner of Income-tax (Appeals), it is found that the assessment orders were passed and they were sent for service to the assessee. The asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. On careful analysis of the orders passed by the Departmental authorities it is found that the learned Commissioner of Income-tax (Appeals) has found from the assessment record that the assessment orders were passed by the Assessing Officer on December 29, 2009 and demand notice under section 156, dated December 29, 2009 and orders of assessment and demand notices were served on the assessee on March 26, 2010. Notice under section 274(1)(b) was signed by the Assessing Officer on December 29, 2009, asking the assessee to appear before him on April 16, 2010. The said notice was sent by the Assessing Officer on December 29, 2009. These notices were also received by the assessee's representative on March 26, 2010. We further find that there is no material in the assessment record which could indicate that initiative was taken by the Assessing Officer to serve the assessment orders along with demand notice immediately after passing of the assessment orders on December 29, 2009. Thereafter, the learned Commissioner of Income-tax (Appeals) considered the judicial pronouncements relied on by the assessee as follows: 1. K. Joseph Jacob v. Agricultural ITO [1991] 190 ITR 464 (K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d it is pending adjudication, but it is not the case of the Department that the hon'ble High Court has stayed the operation of the said order of the Income-tax Appellate Tribunal. In the case of Kodidasu Appalaswamy and Suryanarayana [1962] 46 ITR 735 (AP), the assessment order was passed on March 29, 1957 and served on the assessee along with demand notice on April 6, 1957, having a delay of six days only. But in the present case on hand, there is delay of 85 days that too unexplained before the Tribunal and no material is available in the assessment record as can be seen from the observation of the learned Commissioner of Income-tax (Appeals) in his impugned orders. In the case of Ramanand Agarwalla v. CIT [1985] 151 ITR 216 (Gauhati), the assessment order is dated March 16, 1968, but served on the assessee on April 13, 1968, with a delay of 13 days. But in this case the demand notice was dated April 13, 1968 and it was served on the assessee on April 13, 1968, along with the assessment order. In the case of K. U. Srinivasa Rao v. CWT [1985] 152 ITR 128 (AP), the issue involved is that the assessment order dated July 31, 1979, was served on July 31, 1979, is barred by limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent facts and circumstances available in the present case on hand, the facts and circumstances of the above cases are distinguishable more so when the demand notice and assessment orders in the present case were served on the same day, i.e., March 26, 2010, though they were purportedly made on December 29, 2009. Therefore, respectfully following the decision of the hon'ble apex court rendered in the case of B.J. Shelat v. State of Gujarat, AIR 1978 SC 1109, as well as the decision of the hon'ble Kolkata High Court rendered in the case of Mohendra J. Thacker and Co. v. CIT [1983] 139 ITR 793 (Cal), which have categorically held that the communication is a condition precedent to an order of assessment becoming effective, and also in following the decision of the hon'ble Kerala High Court in the case of K. Joseph Jacob v. Agricultural ITO [1991] 190 ITR 464 (Ker) dealing with section 35(2) of the Agricultural Income-tax Act similar worded as in section 153 of the Income-tax Act, 1961, we are of the considered view that the view taken by the Income-tax Appellate Tribunal, Jodhpur Bench in the case of Shanti Lal Godawat v. Asst. CIT [2009] 126 TTJ (Jodh) 135 being the rule of preceden ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
