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TMI Blog2015 (7) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... nitiating proceeding for reassessment is not a mere procedural requirement but it is a condition precedent to the initiation of proceedings for the assessment u/s.147 of the Act. The mere issuance of notice is not sufficient.Thus we have no other alternative except to annul the reassessment orders made by the AO as well as the impugned order of ld CIT(A) for all the five assessment years under consideration. - Decided in favour of assessee. - IT APPEAL NOS. 340 TO 344 (GAU.) OF 2013 - - - Dated:- 29-1-2015 - H.L. KARWA AND RAJENDRA, JJ. For The Appellant : R.L. Rara, AR For The Respondent : Sachindra Das, DR ORDER H.L. Karwa, President - These five appeals filed by the assessee are directed against the consolidated order of ld. CIT(A) Guwahati, dated 04-03-2013 for the assessment years 1991-92, 1993-94,1994-95, 1998-99 1999-2000 respectively. 2. The assessee has raised the following common grounds in all the above appeals which read as under:- 1. for that, in the facts and circumstances of the case, learned CIT(A) was wrong and unjustified in holding that notice u/s. 147 read with section 148 of the Act for the said year was validly served on the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to be quashed and the impugned order of assessment passed therein should be annulled in its entirety. 6. For that, no proper and justifiable reasons were available to and recorded by the learned Assessing Officer for initiation of the impugned reassessment proceedings and no such reasons were supplied to the appellant and as such, the whole proceeding is against principles of natural justice and his void in law and liable to be quashed and the impugned order of assessment passed therein should be annulled in its entirety. 7. For that the whole proceeding for reassessment and the impugned order passed therein is barred by limitation. 8. For that the impugned order of ex-parte assessment is made without affording sufficient and reasonable opportunity of hearing and is illegal and passed without jurisdiction, as no proper and timely notice for hearing of the case on 31-03-2003 and/or other notice filing hearing of the case was served on the appellant by the assessing officer. 9. For that in view of the categorical submissions of the appellant about non-receipt of the notice u/s. 147/148 of the Act as alleged by the learned Assessing Officer, the onus of issue and service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned AO without any basis, whatsoever. (e) For that, in any view of the matter, the assessment as made is high and excessive and is based on mere surmises and conjectures and as such the same is liable to be annulled in its entirety. (f) For that the learned ITO was wrong and unjustified in charging an amount of ₹ 30,400/- and ₹ 2,41,745/- as interest u/s. 234A 234B respectively. 3. Briefly stated, the facts of the case are that the assessee is an individual and proceedings under section 147 of the Income-tax Act, (in short the 'Act) were initiated and notices u/s. 148 of the Act were issued to the assessee. The assessee did not file any returns of income in response to notices u/s. 148 of the Act. According to the AO, the assessee was given an opportunity of being heard and the case was fixed for hearing on 27.2.2002 but no compliance was made by the assessee. The case was again refixed on 31.3.2003, but the assessee did not comply with the notices. Since the case was becoming time barred, the AO had no other option but to complete the assessments exparte u/s. 144 of the Act, to the best of his judgement on the basis of information available on recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ho shall also consider the arguments of the assessee whether there was another Smt. Chapala Kalita in Basisthapur and the CIT(A) shall also make appropriate enquiry from the postal department to verify whether the specific notice was sent by registered post on 31st May, 2001 to the assessee. Since the primary facts itself need verification we leave the issue of refixation notice served upon the assessee open for the CIT(A) for a decision on merits, after hearing the ld. AR as it will come into question only after the service of initial notice is addressed on facts. 6.1 Before parting we would like to address the judgment of the Hon'ble Apex Court which lays down the proposition that there is a clear distinction between the issue of notice and service of notice , where the notice is issued within the period of limitation, jurisdiction becomes vested in the Income Tax Office to proceed to reassess. Service under the Ac is not a condition precedent to the confinement of the jurisdiction on the Income Tax Officer. It is a condition precedent only to making of the order of assessment. As such, notice which was issued within time is not barred by limitation and having been sent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that ld CIT(A), Guwahati vide his letter dated 12.7.2012 requested the Post Manager, Dispur Post Office, Christian Basti, Guwahati to verify from their records whether a copy of postal receipt dt.31.5.2001 produced before him by the ITO, Ward-1(2), Guwahati, in the course of appeal proceedings in the case of Smt. Chapala Kalita is genuine or not. In response to the said letter, the Sub-Post Master, Dispur, Guwahati vide his letter dated 23.7.2012 stated that With due respect, it is to submit that the U/R case is a time barred case and, therefore, the complaint cannot be entertained . It is also observed that the assessee submitted an affidavit before the ld CIT(A) stating therein that another lady of similar name is residing in the same locality. The ld CIT(A) required the AO to give report and his report was received vide letter dated 31.1.2013. In the said report, it is stated that only one registered post receipt is available in the report, which is found to be posted on the notice u/s.148 for AY 1999-2000. However, Shri A. Sanyal, Income Tax Officer, Ward -1(2), Guwahati did not say anything about service of notice u/s.148 of the Act. Thus, it is clear that there is no evidenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held that service of notice prescribed in section 148 for the purpose of initiating proceeding for reassessment is not a mere procedural requirement but it is a condition precedent to the initiation of proceedings for the assessment u/s.147 of the Act. The mere issuance of notice is not sufficient. The relevant observations made in this regard by the Hon'ble High Court are reproduced hereinbelow: '4. We have heard Shrik. P. Sarma, the learned counsel for the Revenue. None appears for the assessee. The finding of the Tribunal in IT Appeal Nos. 209 and 210 (Gau) of 1983 is quoted below: In fact s. 148 requires that before making the assessment, reassessment or the recomputation under s. 147 of the Act, the ITO shall serve on the assessee a notice under s. 148 containing all or any of the requirements which may be included in a notice under sub-s. (2) of s. 139 and other procedure would follow suit. Service of notice on the assessee is inevitable unless service was effect, we cannot say that reassessment should be treated to be in order as held by the AAC on the ground that the assessee had not raised this ground in the appeal as he has not sought leave to adduce the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiating the proceeding for reassessment is not a mere procedural requirement, it is a condition precedent to the initiation of a proceeding for the assessment under s. 147. Mere issuance of a notice is not sufficient. In R.K. Upadhyaya v. Shanabhai P. Patel (1987) 62 CTR (SC) 17 : IR 1987 SC 1378 : TC 41R1711, the Supreme Court has pointed out that service under the new Act is not a condition precedent to conferment of jurisdiction in the ITO to deal with the matter, but it is a condition precedent to making of the order of assessment . 6. There is no material to show that the employee appeared in pursuance of a notice under s. 148. He appeared only in response to a notice under s. 142(1) Sec. 142(1) deals with enquiry before assessment and the appearance of the employee in terms of this notice to produce such account or document as the AO may require cannot be deemed to be the knowledge of the proceeding under s. 147. 7. That being the position, agreeing with the findings as quoted above, we hold that no notice was served under s. 148 and the appearance of a person in response to a notice under s. 142(1) cannot be deemed to be the knowledge of the proceedings under s. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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