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TMI Blog2014 (3) TMI 221X X X X Extracts X X X X X X X X Extracts X X X X ..... not to quash the whole proceedings as it amounted to leaving the assessee go scot-free, though he is liable to pay tax on the capital gains – Because of procedural lapses, the assessee should not be a gainer and that too by default to escape his liability. Default made by the revenue in compliance with the procedure in place for service of the assessee ipsofacto, is not a circumstance to let the assessee go scot free from the taxation regime when his liability of payment of capital gain tax is not questioned - Since the land is located at village Mansoorwal Dona, District Kapurthala and the proceedings are not required to be conducted at the place of residence of power of attorney of the assessee – Thus, the order is liable to be set as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble ITAT was right in law in holding the service of notice u/s 148/142(1) and 143(2) as invalid when the assessee was not avialable in India and the AO has sent the notices at last known address in India and also validly affixed these notices at the last known address of the person holding power of attorney. (II) Whether on the facts and in the circumstances of the case the Hon'ble ITAT was right in law in quashing the order of the AO when it was established by the AO and confirmed by the CIT(A) that the assessee was liable to pay capital gain tax on the compensations received by him from PUDA and the decision of the Hon'ble ITAT has benefited the assessee to escape statutory liability of payment of Income Tax on his tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee. The concerned Inspector of the revenue found that it was not possible to effect service in ordinary manner and consequently, service of the notice was effected under Section 142(1) of the Act through affixation on the last known address of the assessee. Since after acquisition of the whole land of village Mansoorwal Dona by PUDA, it had been converted into a residential colony and as such, notice was affixed on the Dharamshala of the village. None appeared on behalf of the assessee. Accordingly, the AO proceeded to frame assessment in terms of Section 144 of the Act i.e. calculating the quantum of long term capital gain for the assessment year 1999-2000 at Rs.1,00,09,746/-. As the assessee had concealed this entire income, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that contentions of the assessee were judiciously dealt with. Pursuant to this order of 18.2.2008 (Annexure A-2), proceedings of assessment were started afresh. During that proceedings, it was noticed that the assessee had filed the return of income for the assessment year 1999-2000 with the Income Tax Officer, Ward-VI, Jalandhar on 21.8.2000 mentioning the address as c/o Shri Jarnail Singh, resident of village Dheena, District Jalandhar Cantt. The AO noticed that the return filed by the assessee on 21.8.2000 without enclosing the power of attorney in favour of Jarnail Singh and with incorrect address, was an invalid return. The verification had also been found to be improper and thus return was invalidated on that account as well. 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bad in law and the assessment made thereunder was liable to be quashed. Accepting version of the assessee, assessments were quashed. 13. Plea of the revenue is that when the Tribunal had accepted claim of the assessee that notices issued by the Income Tax Officer, Kapurthala-I, Kapurthala under Section 147 as also under Section 143(2) of the Act had neither been served on the assessee nor on his agent Jarnail Singh and thus, were of no legal significance, the assessee should not have been just let off. It is contended that when liability of the assessee to pay tax on capital gains is undisputed, he should have been brought back within the ambit and scope of law to discharge his liability. 14. Counsel for the respondent-assessee, on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efault made by the revenue in compliance with the procedure in place for service of the assessee ipsofacto, is not a circumstance to let the assessee go scot free from the taxation regime when his liability of payment of capital gain tax is not questioned. When the proceedings had been started by the Income Tax Officer, Kapurthala-I, Kapurthala but the same were found to be defective on technical and procedural grounds of service of the assessee, liability of payment and capital gains tax which had accrued against the assessee, would not be lost sight of and forgotten, as has been projected by the assessee. 18. It is, thus, ordered that the Income Tax Officer, Kapurthala-I, Kapurthala would start the proceedings afresh after seeking appe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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