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TMI Blog2016 (3) TMI 1199X X X X Extracts X X X X X X X X Extracts X X X X ..... re directing service of notice through substituted manner. In the present case, since, the notice u/s. 143(2) has not been validly served on the assessee the proceedings arising there from are vitiated. Thus, in view of the provisions of the Act we are of considered view that proper service of notice u/s. 143(2) is mandatory. The Department cannot take the shelter of section 292BB where there is no proper service of notice u/s. 143(2) and the assessee has participated in assessment proceedings. Non-service of notice u/s. 143(2) is fatal to the assessment proceedings. In the absence of proper and valid service of notice, the proceedings arising therefrom are null and void and are thus liable to be annulled. - Decided in favour of assessee X X X X Extracts X X X X X X X X Extracts X X X X ..... ppearing on behalf of the assessee submitted that there was no valid service of notice issued u/s. 143(2). As per the provisions of section 282 as were applicable during the period relevant to the assessment year 2007-08 the notice was required to be served on the assessee in the first instance by post or as if they were summons issued by the court under the Code of Civil Procedure. In the present case, no effort was made by the Department to serve the notice to assessee through registered post or under the normal course. No reason whatsoever has been given for service of notice by affixation. The ld. AR placed on record a copy of service report along with Panchnama dated 30-09-2008. The ld. AR submitted that no valid reason has been given in the service report or Panchnama for substituted method of service. In support of his submissions, the ld. AR placed reliance on the decision of Hon'ble Delhi High Court in the case of Commissioner of Income Tax Vs. Chetan Gupta in ITA 72 of 2014 decided on 15-09-2015 and the decision of Mumbai Bench of the Tribunal in the case of Shri Sanjay Badani Vs. DCIT in ITA No. 5221/Mum/2014 decided on 09-09-2014. 4.1 The ld. AR submitted that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be sufficient." The procedure relating to substituted service is contained in Order V Rule 17 of the Code of Civil Procedure. The same reads as under: "17. Procedure when defendant refuses to accept service, or cannot be found.- Where the defendant or his agent or such other person as aforesaid refuses to sign the acknowledgment, or where the serving officer, after using all due and reasonable diligence, cannot find the defendant, who is absent from his residence at the time when service is sought to be effected on him at his residence and there is no likelihood of his being found at the residence within a reasonable time and there is no agent empowered to accept service of the summons on his behalf, nor any other person on whom service can be made, the serving officer shall affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily resides or carries on business or personally works for gain, and shall then return the original to the court from which it was issued, with a report endorsed thereon or annexed thereto stating that he has so affixed the copy, the circumstances under which he did so, and the name ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture on the assessee Shri Anil S. Khatri [PAN ADMPK 5329H] residing at 604-A Wing, Angelina, Raheja Garden, Wanawadi, Pune today i.e. on 30/09/2008 in the presence of two witness as per Panchnama enclosed here with. Submitted Sir. Pune Date 30/09/2008 Yours faithfully, Sd/- _______ 30/9/08 (M.B. Sayyed) Inspector." "PANCHNAMA As directed by the Income Tax Officer (International Taxation)-I, Pune, I Shri M.B. Sayyed, Inspector, put maximum efforts to serve the notices under section 142(1) & 143(2) dt. 26/9/2008 for A.Y. 2007-08, to the assessee Shri Anil S. Khatri [PAN ADMPK 5329H] on the given address at 604-A Wing, Angelina, Raheja Garden, Wanawadi, Pune-20. On local enquiry the where abouts of the said assessee could not be traced out. Therefore, the above said notices is served by me by affixture on the main door of the assessee flat on the above given address in presence of two witnesses available at that time, at that place. The signature of the two witness have been placed on both the notices along with dates. Submitted Sir, Pune Date 30/09/2008 Sd/- _______ 30/9/08 (M.B. Sayyed) Inspector." Signature & Name & Address of the witness 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the assessee or his agent refuses to sign the acknowledgment or could not be found. Here, in the present case, no effort was made by the Income-tax Department to serve the notice upon the assessee, since the company of the assessee was closed due to Holi festival holidays, and admittedly no effort was made by the serving officer to locate the assessee. 24. Even otherwise, as per Order V, rule 19A of the Code of Civil Procedure, the notice sent by registered post ought to have been sent along with acknowledgment due but admittedly it was not sent along with acknowledgment due. 25. So, from the entire material available on record we have no hesitation in holding that there has been no valid service of notice under section 148 of the Act upon the assessee as the same was neither tendered to the assessee or his agent, nor the same was refused by either of them. 26. Since there has been no proper service of notice on the assessee, we hold that the reassessment proceedings, resulting in the order dated January 30, 2003, are bad in law." 11. The Hon'ble Delhi High Court in the case of Commissioner of Income Tax Vs. Chetan Gupta (supra) has taken a similar view where the notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee in accordance with provisions of the Act. The Tribunal after appreciating the facts of the case and the decision of Hon'ble Supreme Court of India in the case of Assistant Commissioner of Income Tax and Another Vs. Hotel Blue Moon (supra) held that the assessment order passed without valid service of notice u/s. 143(2) is null and void. The relevant extract of the findings of the Tribunal are as under: "13. As per sub-section (1) of section 282, the notice is to be served on the person named therein either by post or as if it was a summons issued by Court under the Code of Civil Procedure, 1908 (V of 1908). The relevant provision for effecting of service by different modes are contained in rules 17, 19 and 20 of Order V of CPC. Rules 17, 19 and 20 of Order Vof CPC lay down the procedure for service of summons/notice and, therefore, the procedure laid down therein cannot be surpassed because the intention of the legislature behind these provisions is that strict compliance of the procedure laid down therein has to be made. The expression after using all due and reasonable diligence' appearing in rule 17 has been considered in many cases and it has been held that un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hrough affixture has not been noted by the AO in the notesheet nor he has issued any direction for issuing notice through affixtures. The next entry of note sheet dated 28-7-2012 just indicates that letter was filed by the Inspector regarding service of notice by affixtures, dated 17-7-2012. Thus, on 17-7-2012, the first entry was made and without recording any apprehension about the delay by such mode second entry for affixation was made on 28-7- 2012 without showing justification for the same. Thus, it is clear that report of the Inspector was obtained without issuing any prior direction for such process or mode. Thus, the adoption of mode of substituted service was not legally justified. It is also clear from the Inspector's report that there is no mention of name and address of the person who had identified the house of the assessee and in whose presence the notice u/s.143(2) was affixed. There is no evidence or indication in the report of Inspector that he had personal knowledge of the place of the business of the assessee and was, thus, in a position to identify the same. Therefore, neither the procedure laid down under order V. rule 17 had been followed nor that laid down un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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