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TMI Blog2015 (9) TMI 1443X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 148 of the Act, as, till now the reasons have not been provided to the appellant. Communication of the alleged reasons by a letter which may not be the actual reasons does not fulfil this requirement. 3. On the alternative and without prejudice to the above, the Commissioner of Income-tax (Appeals), ought to have held that no belief was forward by the Assessing Officer as required by section 147 of the Act and the Assessing Officer had only relied on the findings given by the Commissioner of Customs without any independent application of mind which is not permissible in law. 4. In the alternative and without prejudice to the above, the Commissioner of Income-tax (Appeals), ought to have held that there was no material before the Assessing Officer which could lead to the formative of belief that the appellant's income chargeable to tax has escaped assessment by way of grant of excess deduction under section 10A of the Act. The material, if any, has no nexus with the belief formed by the Assessing Officer. 5. The Commissioner of Income-tax (Appeals) ought to have held that the jurisdictional pre-conditions necessary to be fulfilled under section 143(2) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the issue is covered with the judgment of the hon'ble Supreme Court in the case of Asst. CIT v. Hotel Blue Moon [2010] 321 ITR 362 (SC). It was submitted that there are many other judgments of various High Courts and various judgments of the Income-tax Appellate Tribunal on this issue. It was submitted that when this issue was raised before the learned Commissioner of Income-tax (Appeals), it has been accepted in the appellate order by the learned Commissioner of Income-tax (Appeals) that there is no evidence of service of the mandatory notice. But the learned Commissioner of Income-tax (Appeals) did not accept the submissions of the assessee on the ground that the assessee is debarred by the provisions of section 292BB to raise any objections with regard to the services of notice in the course of appellate proceedings as no such objections were raised before the Assessing Officer. It was submitted that the order of the learned Commissioner of Income-tax (Appeals) is contrary to law and is against the judgment of the hon'ble Supreme Court and the High Courts. It was also submitted that the provisions of section 292BB are not applicable on the facts of this case beca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r section 143(2) dated August 11, 2008, was available in the assessment file. There was no evidence of its issuance and dispatch. There was no evidence of service of this notice in the file. Although, in the "order-sheet", it has been mentioned that notice was issued under section143(2) of the Act. But there was nothing to show that it was dispatched by the Assessing Officer to the assessee. There was nothing to show that it was handed over by the Assessing Officer to the notice server. There was nothing to show that the notice has been issued out of the bounds of the Assessing Officer meant to be delivered to the assessee. It is further noted by us that the learned Commissioner of Income-tax (Appeals) has also confirmed this fact in his order at paragraph 3.5.1 that apparently there is no evidence on record with regard to service of notice under section 143(2). During the hearing before us a specific query was raised by us to the learned Departmental representative to show us any evidence with regard to issuance and service and for this purpose sufficient time was also given to the learned Departmental representative. However, the learned Departmental representative expressed his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssume jurisdiction to make assessment of the return filed by the assessee. Thus, in simple words and as per the plain reading of law, service of notice upon the assessee under section143(2) within the 12 months from the end of the month in which return is filed by the assessee in pursuance of the notice under section 148 issued by the Assessing Officer for reopening of the assessment, is mandatory to enable the Assessing Officer to assume jurisdiction to make assessment of the aforesaid return. This issue is no more res integra as there are umpteen numbers of judgments on this issue from various courts. We derive support from the judgment of the hon'ble Supreme Court in the case of Hotel Blue Moon (supra). We further derive support from the judgment of the hon'ble jurisdictional High Court in the case of Asst. CIT v. Geno Pharmaceuticals Ltd. [2013] 84 CCH 117 (Bom) holding that service of notice under section 143(2) is mandatory and in the absence of such service, the Assessing Officer cannot make an inquiry on the return filed in compliance with the notice issued under section 148. Thus, as per law, issuance and service of jurisdictional notice under section 143(2) is ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew was taken by the Special Bench of the Income-tax Appellate Tribunal in the case of Kuber Tobacco Products P. Ltd. v. Deputy CIT [2009] 310 ITR (AT) 300 (Delhi) [SB] ; [2009] 117 ITD 273 (SB). It has been held by the hon'ble Kerala High Court in the case of Dr. K. M. Mehaboob v. Deputy CIT [2012] 76 DTR 90 (Ker) that section 292BB does not have retrospective effect. Further, the hon'ble Allahabad High Court in the case of Asst. CIT v. Greater Noida Industrial Development Authority [2015] 379 ITR 14 (All) (in Income-tax Appeal No. 142 of 2015 dated August 4, 2015) has held that section 292BB does not cure defect in issuance of notice, it does not have retrospective operation and it shall not be applicable to the assessment year 2008-09 and years prior to that. The relevant extracts of this judgment are reproduced below (page 19) : "The Supreme Court clearly held that omission on the part of the Assessing Officer is not a procedural irregularity and is incurable and, therefore, the requirement of notice under section 143(2) of the Act cannot be dispensed with. Similar view was held by a Division Bench of this court in CIT v. Salarpur Cold Storage (P) Ltd. [2014] 50 ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll as the order of the appellate authority." Thus, from these judgments, it is clear that section 292BB has no retrospective operation. 13. It is further seen by us that in the case before us, the proceedings were initiated by the Assessing Officer by issuing notice under section 148 dated August 29, 2007. In response to the same, return has been filed by the assessee on September 14, 2007. Thus, both the dates fell before April 1, 2008, being the date of coming into operation of section 292BB. It is well established principle of law that right to file an appeal is a substantive right. Thus, when the assessee filed its return of income on September 14, 2007, a valuable substantive right accrued to the assessee, i.e., right to be served with the mandatory notice, as per law prevailing on the date of filing of return and statutory right of filing of appeal against any action in the form of framing of the assessment upon the assessee, without being served with the mandatory jurisdictional notice, the deeming provisions of section 292BB could not have been applied retrospectively taking away this valuable right from the assessee. Any such curtailment of vested right cannot be constru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ught to be construed as prospec tive only." We further derive support from the judgment of the hon'ble Supreme Court in the case of Gem Granites v. CIT [2004] 271 ITR 322 (SC) holding that every statute is prima facie prospective unless it is expressly or by necessary implication made to have retrospective operation. We also refer to the following judgments on this issue : (i) R. Rajagopal Reddy v. Padmini Chandrasekharan [1995] 213 ITR 340 (SC) ; and (ii) M. G. Pictures (Madras) Ltd. v. Asst. CIT [2003] 263 ITR 83 (Mad). Thus, in our considered view, the provisions of section 292BB could not have been applied upon the facts of this case and thus this question can be answered in favour of the assessee. 14. Second question arising here for our consideration is that whether section 292BB cures defect in "issuance" of notice also. In this regard, it has been seen by us, from the perusal of the assessment records, that there is no evidence of issuance of the notice, as has been discussed by us in earlier part of this order also. Under these circumstances, a question arises that whether the Revenue can take recourse to the provisions of section 292BB to cure the defect in issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has no jurisdiction to make assessment and the absence of service of notice could not be held to be curable under section 292BB of the Act. Thus, viewed from this angle also the provisions of section 292BB could not have been applied on the facts of this case. Further, reliance has been placed by learned counsel on the judgment of the co-ordinate Bench of Mumbai in the case of Sanjay Brothers v. Asst. CIT (I. T. A. No. 947/Mumbai/2013 dated January 9, 2015). It is seen by us that a similar view has been taken in the said judgment and we derive further support therefrom. 15. Third question that arises for our consideration is whether the Assessing Officer could take recourse to the provisions of section 292BB to extend the statutory period within which notice could have been served upon the assessee. We find that on this aspect also judgments have been given by the courts, as may be noted in the case of CIT v. Panorama Builders (P.) Ltd. [2014] 45 taxmann.com 159 (Guj), it was held by the hon'ble Gujarat High Court that section 292BB does not enlarge the statutory period where mandatory notice section 143(2) of the Act is required to be issued within the limitation fixed under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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