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TMI Blog2019 (5) TMI 1538X X X X Extracts X X X X X X X X Extracts X X X X ..... p allotted to the assessee during the year, was however paid for only at Rs. 2.70 lacs during the year, having been acquired on instalment basis. As such, the addition, even if sustained in principle, as it was, could not exceed the amount actually paid (Rs. 2.70 lacs), a grievance projected per Ground 10 of the assessee's appeal before the ld. CIT(A), who though had failed to consider the same while confirming the addition effected in assessment, i.e., for Rs. 14.20 lacs. The assessee, it was submitted by the ld. counsel, Sh. Bahl, was awaiting the rectification order in-asmuch as, if favorably considered, as indeed it ought to have been, the assessee would not be required to raise this issue in further appeal, which would then be restricted, as is the case, only to the legal ground/s, also raised in first appeal. The ld. CIT(A) disposed the assessee's application vide order dated 30.5.2016, which was received in the first week of July, 2016, and the instant appeal, assuming only the legal ground/s, filed on 29.8.2016, i.e., within 60 days of the receipt of the order u/s. 154 dated 30.5.2016. This, therefore, it was averred by him, constituted a reasonable ground for the delay. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the assessment was rejected. His objection on the quantum of the addition, in-as-much as only a part of the bargain price was paid during the year, raised per Ground 10 of his appeal before him, was not considered by the ld. CIT(A). It was this that formed the subject matter of the assessee's rectification application to him. There was, accordingly, no need, both in law and on facts, for the assessee to have awaited the outcome of the said application in filing an appeal challenging his order on the legal aspect/s. Why, even if the assessee wished to, at the same time, safeguard his interest on the quantum of the addition, all that he was required to do was to raise a grievance qua the non-adjudication of Gd. 10 of the appeal by the first appellate authority. If, therefore, the assessee, as a matter of strategy thought it fit to seek rectification - a separate matter altogether entailing only a mistake/s apparent from record, it cannot be said that there was sufficient cause for the three month delay in filing the appeal. Why, for all we know, the said rectification application may have remained undisposed by the ld. CIT(A) for months, as in fact is usually the case. The assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as grossly erred in not appreciating that the notice u/s. 133(6), 147/148 and notice u/s. 142(1), 143(2) and Assessment Order were never validly served on the assessee.' 4.1 Explaining his case, Sh. Bahl would submit that the AO is wrong in stating, in the reasons recorded, which finds statement in the assessment order, that the assessee did not file his return of income for the relevant year and, on that basis, inferring that the impugned investment by the assessee, which he incorrectly claims at Rs. 14.20 lacs, is unexplained. The assessee had in fact, filed his return of income for the year on 26/5/2004. How could, then, he would argue, the AO have a reason to believe that the impugned sum had not been disclosed, i.e., without reference to the assessee's return, and had therefore escaped assessment? A perusal of the assessment order, stating the reasons recorded u/s. 148(2), shows that the AO, prior to forming his belief as to the escapement of income, sought information from the assessee u/s. 133(6) of the Act, including about the filing of the return for the relevant year. The same being not responded to, he inferred the assessee to have not filed any return of income for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... smissing the assessee's Gd. 5 before him. The address mentioned in the assessee's return for AY 2004-05, as well as the returns (and the assessment orders) for AYs 2005-06 to 2011-12, is 'Shop No. 1, Nehru Shopping Complex, Lawrence Road, Amritsar' (PB pgs. 11- 16). It is further clear that the addresses at which these notices were sent by the AO is neither the address as per the return for the relevant year nor that as per PAN. There is, at the same time, nothing to show that the address at which these notices were sent is no longer the assessee's address, i.e., of he having left it, with nothing to that effect brought on record even at the appellate stage. For all one may know, the said address may be the assessee's address as per the return for AY 2003-04, the immediately preceding year. The claim of the assessee of having left that address long ago, as claimed, cannot therefore be accepted and, accordingly, the ld. CIT(A) cannot be said to have faulted in this regard. The question of the validity of the service apart, it is, however, clear that the assessee did not receive the notice u/s. 133(6) or the subsequent notice u/s. 148(1). The assessee has also not intimated the chang ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice', distinctly used by the Legislature, as well as the anomaly that may arise if the word 'issue' was to be read as 'service'. Reading the two as synonymous, it explained, would be to render nugatory the evil sought to be remedied by section 149 of the Act. The use of separate and distinct words in the statute, it observed, was with a view to remedy the evil perpetrated by the long delayed and studied avoidance of the service of the notices by the assessees whose income had escaped assessment. Here one cannot help but refer to the similar sentiment expressed by the Hon'ble jurisdictional High Court in Jasbir Singh (infra) and V.R.A. Cotton Mills (P.) Ltd. v. Union of India [2013] 359 ITR 495 (P&H). Both the Hon'ble jurisdictional and the Patna High Court dissented from the decision in Shanabhai P. Patel v. Upadhyaya [1974] 96 ITR 141 (Guj), which was subsequently reversed by the Apex Court. Service under the Act (referred to as a new Act), it held, is not a condition precedent to confer jurisdiction to the Income-Tax Officer (ITO), though is one for making the order of assessment. This would also meet the assessee's reliance on CIT v. Ramendra Nath Ghosh [1971] 82 ITR 888 (SC). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... explained, no time limit under the Act for the service of notice after its issue in time, with, further, the time limit for framing the assessment being reckoned from the date of its service (153(2); also see Prakash Electric Company v. ITO [2008] 118 TTJ 539 (Bang)). As such, the logical consequence of non-service, would be to cause it's service, the whole purport of which is to grant opportunity to the assessee to state his case. Sh. Bahl would answer in the negative. This is understandable as the assessee has already availed sufficient opportunity to explain his case, with, in fact, the addition restricted to the amount admittedly paid during the current year (Rs. 2.70 lacs), which aspect of assessment, i.e., addition on quantum as sustained, has not even been agitated in appeal. Restoration, entail as it does time and effort, is not an empty formality, and must achieve some substantive purpose. Reference in this context may also be made to the decision in CIT v. Jasbir Singh [2014] 103 DTR 427 (P&H), referred to by the ld. Sr. DR during hearing. In the facts of that case, the AO could not get the current residential address of the assessee and, accordingly, the notice was se ..... 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