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TMI Blog2013 (10) TMI 1118X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. 4. That the Ld. CIT(A) has grossly erred in not annulling the reassessment order on the ground that the notice u/s 143(2) was issued beyond the period of 12 months from the end of the month in which the return was filed. 5. The Ld. CIT(A) has erred in holding that reasonable opportunity was allowed by the AO in passing the reassessment order u/s 143(3)/148 of the Income-tax Act, 1961. 6. The Ld. CIT(A) has erred in sustaining the addition of Rs. 81,03,553/- made by AO on the ground that these are bogus purchases made from various fictitious concerns. 7. The Ld. CIT(A) has erred in sustaining the addition of Rs. 56,440/- being business promotion expenses by relying upon his own order dated 05-03-2004 for A.Y. 1998-99. 8. The Ld. CIT(A) has erred in sustaining the addition of Rs. 4,81,588/- being employer and employees contribution towards provident fund and ESI despite the fact that the amounts were deposited in the government account before the due date for filing the return of income for A.Y. 1999-00. 9. The Ld. CIT(A) has erred in confirming the charging of interest u/s 234A, 234B and 234 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsp; (vi) It was only after the company received the show cause notice for the payment of outstanding tax for various years vide notice dated 16-01-2009 (received on 31-01-2009) that the company realized that the appeal for this year i.e. A.Y. 1999-00 could not be filed before the Tribunal by the erstwhile counsel. A copy of the show cause notice dated 16-01-2009 is at Annex.- V." 4. Ld. Counsel for the assessee contends that the untimely and unfortunate death of Shri Dhivesh Kumar Vyas the young son of Smt. Rekha Vyas, Director of the company, rendered her in state of shock, depression and disenchanted to worldly affairs. The problem was aggravated by the serious ailments of the life time CA of the company Shri Harish Gambhir and his death caused by diseases which brought problems in professional compliance. She was under bona fide belief that the appeals were being taken care of by his office. However, when the reminders for outstanding tax payments were received by the company, the state of affairs were ascertained that the appeals were not filed. Consequently they were filed belatedly. Copies of death certificates of Shri Dhivesh Kumar Vyas and late Shri Harish Gambhir are fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ening of assessment before. Assessing officer who did not consider these objections before proceeding with the reassessment as held by Hon'ble Supreme Court in the case of G.K.N. Driveshaft 259 ITR 90 for the proposition that assessee has a right to file objection on the issues of reason and reassessment notice. The assessing officer is bound to dispose of the same by a speaking order, assessing officer has failed to decide the objections raised by the assessee, besides, sufficient time was not given during assessment for compliance. These issues were raised before CIT(A) along with a specific ground that no mandatory 143(2) notice was issued on the assessee before proceeding with assessment. All these issues were raised before CIT(A) which though are mentioned in his order, however, ld. The CIT(A) disposed of the issue about objection in terms of G.K.N. Driveshaft (supra) by summarily holding that no valid objections were raised by the assessee. It is pleaded that the objections are to be decided by the assessing officer who initiated the reasons and not by CIT(A). The validity of objections is to be decided by the assessing officer. When the assessing officer fails to do the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he objections, it is imperative on the part of assessing officer to see whether a proper and valid service of notice u/s 143(2) was made on the assessee or not. Mere issuance of notice does not suffice and par take the character of proper service of notice u/s 143(2) on the assessee. Without the service of a proper notice u/s 143(2), the reassessment cannot be held to be valid. These aspects are specifically and categorically to be decided by the assessing officer in set aside proceedings. The assessee's objections about the sufficient time being not given for reassessment, if any, also stands remedied by setting aside pending proceedings. 10.2. Since we have set aside the issues, which go to the root of the validity of the assessment, the issues raised by the assessee on merits will be germinated only after deciding the above issues. Consequently, the entire appeal is set aside and restored to the file of assessing officer to decide the same afresh in accordance with law. ITA no. 832/Del/2009 (Asstt. Yr: 2004-05) 11. Following effective grounds are raised: "1. The Ld. CIT(A) has erred in sustaining the disallowance of Rs. 1,56,256/- being amounts paid to Canara Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e bad debts written off was brought on record by the assessee and has been disallowed on wrong assumption that relevant details were not filed. In view thereof we are inclined to delete the addition. Assessee's appeal for A.Y. 2004-05 is allowed. Assessee's appeal 952/Del/2009 (A.Y.2005-06): 15. Following effective grounds are raised: "1. The Ld. CIT(A) has erred on facts and in law in directing the AO to disallow 50% of the commission u/s 40(a)(ia) 2. The Ld. CIT(A) has erred on facts and in law in sustain the addition of Rs. 1,89,000/- representing loans from various parties. 3. The Ld. CIT(A) has erred on facts and in law in confirming the addition of Rs.17,395/- being contribution towards ESI and PF deposited in the government account. 4. That the Ld. CIT(A) erred on facts and in law in confirming the charging of interest u/s 234A, B & C of the Income-tax Act, 1961." 16. Apropos first issue ld. Counsel for the assessee contends that the TDS was deducted by assessee qua the commission payment albeit at a lesser rate under a bona fide impression that the commission was payable @ 5%. According to assessing officer the TDS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parties for procurement of foreign business and they had no presence or office in India. In view thereof, the 50% disallowance u/s 40A(ia) is deleted.
18.1. Apropos ground no. 2, the assessee has challenged the fact that on the alleged date CA of the assessee was not present in the proceedings before assessing officer and Mrs. Vyas, the lady director, had not made any such offer as alleged by the assessing officer. Since the copy of the proceeding sheet has not been given to the assessee, interest of natural justice require that assessee be allowed an opportunity to defend its case after the order sheet entry is made available. The issue is accordingly set aside back to the file of assessing officer.
18.2. Apropos ground no. 3 the payment of Rs. 17,395/- on account of ESI and PF having been paid before the due date of filing of the return, the disallowance is deleted. The assessee's appeal is allowed for statistical purposes.
19. In the result, assessee's appeal for A.Y., 1999-2000 is allowed for statistical purposes; for A.Y. 2004-05 is allowed; and for A.Y. 2005-06 is partly allowed for statistical purposes.
Order pronounced in open court on 13-09-2013. X X X X Extracts X X X X X X X X Extracts X X X X
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