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TMI Blog2019 (4) TMI 215X X X X Extracts X X X X X X X X Extracts X X X X ..... sment proceedings before the A.O. and the ground of nonissuance of section 143(2) notice had been taken up for the first time before the CIT(A) in contradiction of section 292BB?" 2. The assessment year is 2005-06 and the relevant accounting period is the previous year 2004-05. 3. In this case, the assessment order came to be passed under section 143(3) of the Act on 31.12.2007. Subsequently, the case was reopened for the reason that the assessee was required to pay tax under the provisions of section 115JB of the Act. According to the Assessing Officer, the calculation made by the assessee for the year under consideration was not in accordance with the Explanation to section 115JB of the Act, which resulted in short levy of tax. Accordingly, an order came to be passed under section 143(3) read with section 147 of the Act on 12.11.2010 and book profit was computed as per the provisions of section 115JB of the Act, which came to Rs. 1,55,80,355/. 4. The assessee carried the matter in appeal before the Commissioner (Appeals), before whom it was pointed out that the case was reopened by issuing notice under section 148 of the Act on 20.03.2009, 26.03.2009, 08.03.2010, 05.07.2010 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt placed reliance upon the provisions of section 292BB of the Act for the presumption that the assessee had been validly served. 7.2 Reliance was also placed upon the decision of Madras High Court in case of Venkatesan Raghuram Prasad v. Incometax Officer, NonCorporate Ward2( 3), Chennai, (2018) 94 taxmann.com 249 (Madras), wherein, the Assessing Officer had reopened the assessment of the assessee and the assessee had participated in the reassessment proceedings without raising any objection before the Assessing Officer to the effect that there was no valid issuance or service of reassessment notice upon the assessee. On the said facts, the court held that such objection cannot be raised before the first appellate authority. It was submitted that since the assessee herein has not raised any objection before the Assessing Officer with regard to nonservice of notice under section 143(2) of the Act, it was not permissible for the assessee to raise such objection before the Commissioner (Appeals) and that the impugned order passed by the Tribunal does give rise to a substantial question of law as proposed or as may be deemed fit by this court. 8. Opposing the appeal, Mr. S.N. Diveti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of notice under section 143(2) cannot be dispensed with. 8.4 Reliance was also placed upon the decision of the Delhi High Court in case of Director of Incometax v. Society for Worldwide Inter Bank Financial, Telecommunications, (2010) 323 ITR 249 (Delhi), wherein, the court held that the provisions of section 143(2) of the Act would make it clear that notice can be served after the Assessing Officer has examined the return filed by the assessee, whereas, in the facts of the said case, when the assessee came to file the return, the notice under section 143(2) of the Act was served upon the authorized representative by hand. The court observed that thus, even if the statement of Assessing Officer is taken at its face value, it would amount to gross violation of the scheme of section 143(2) of the Act. 8.5 Reliance was also placed upon a decision of this court in case of Dy. CIT v. Mahi Valley Hotels & Resorts, 2006(287) ITR 360, wherein, the court placed reliance upon Circular No.549 dated 31.10.1989 issued by the Central Board of Direct Taxes, which to the extent the same is relevant for the present purpose reads thus: "5.13 A proviso to subsection (2) provides that a notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the reasons. It appears that in response to the notice under section 148 of the Act, the respondentassessee, by a letter dated 19.07.2010, had asked the Assessing Officer to consider the earlier return of income filed by it as the return filed in response to the notice. After the assessee addressed the above letter dated 19.07.2010 to the Assessing Officer, no notice under section 143(2) of the Act was issued. The notice under section 143(2) of the Act had been issued to the assessee on 12.03.2010 only, that is, prior to the communication dated 19.07.2010 of the assessee, informing the Assessing Officer to treat the earlier return filed by it as the return filed in response to the notice under section 148 of the Act. Nonetheless, the assessment proceedings proceeded further pursuant to the notice under section 148 of the Act and came to be concluded by an assessment order dated 07.01.2011 made under section 143(3) read with section 147 of the Act. 12. The facts as emerging from the record show that it is an admitted position that no notice under section 143(2) of the Act had been issued after the assessee informed the Assessing Officer to treat the earlier return of income as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a date on which he should produce or caused to be produced, any evidence or particulars specified therein on which the assessee may rely in support of such claim. 15. Section 292BB of the Act reads thus; "292BB. Where an assessee has appeared in any proceeding or cooperated in any inquiry relating to an assessment or reassessment, it shall be deemed that any notice under any provision of this Act, which is required to be served upon him, has been duly served upon him in time in accordance with the provisions of this Act and such assessee shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was (a) not served upon him; or (b) not served upon him in time; or (c) served upon him in an improper manner: Provided that nothing contained in this section shall apply where the assessee has raised such objection before the completion of such assessment or reassessment." 16. From the language employed in section 292BB of the Act, it emerges that a notice would be deemed to be valid in the three circumstances provided therein, namely, where the assessee has participated in the proceedings it would not be permissible for him to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dural irregularity and the same is not curable and, therefore, the requirement of notice under section 143(2) cannot be dispensed with." 19. Thus, the Court held that if an assessment has to be completed under section 143(3) read with section 158BC of the Act, then notice under section 143(2) of the Act should be issued within a period of one year from the date of filing of block return. The Court held that omission on the part of the Assessing Officer to issue notice under section 143(2) of the Act cannot be said to be a procedural irregularity and the same is not curable, and therefore, the requirement of notice under section 143(2) of the Act cannot be dispensed with. 20. In the facts of the present case also, if the contention of the appellant were to be accepted, it would amount to dispensing with the notice under section 143(2) of the Act in view of the fact that it is an admitted position that no such notice had been issued after the return of income was filed by the assessee. After the filing of the return of income, unless a notice under section 143(2) of the Act is issued to the assessee, he would have no means of knowing as to whether or not the Assessing Officer has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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