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TMI Blog2018 (12) TMI 1754X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT (A) is illegal, unjustified and against the facts of the case. Relief may please be granted by quashing the said disallowance of Rs. 8,04,524/-. 3. The appellant craves its rights to add, amend or alter any of the grounds on or before the hearing. The assessee has also raised an additional ground as under :- "In the facts and circumstances of the case, and in law, the ld. AO has erred in completing assessment u/s 147 without issuing notice u/s 143(2) of the Income Tax Act, 1961. The action of ld. AO is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by quashing entire reassessment proceedings, being void and illegal." Since the additional ground raised by the assessee is legal in nature and goes to the root of the matter, therefore, we first propose to take the additional ground raised by the assessee. 2. The ld. A/R of the assessee has submitted that the additional ground is purely legal in nature and all relevant facts for adjudication of this ground are available on record. He has further contended that no new facts are required to be examined or investigated, therefore, the additional ground raised by the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eme Court in the case of ACIT vs. Hotel Blue Moon, 188 Taxman 113 (SC). The ld. A/R of the assessee has also relied upon the following decisions :- Travancore Diagnostics (P) Ltd. vs. ACIT 390 ITR 167 (Kerala) Principal CIT vs. Silver Line 383 ITR 455 (Delhi) Thus the ld. A/R has submitted that the impugned re-assessment order passed by the AO is bad in law and liable to be quashed. 6. On the other hand, the ld. D/R has submitted that the assessee did not file any return of income in response to notice under section 148 of the Act but submitted before the AO that the original return of income filed under section 139 of the IT Act may be treated as return filed in response to notice under section 148. Thus the ld. D/R has submitted that when no fresh return was filed by the assessee then there is no requirement for issuing notice under section 143(2) of the Act for completion of the re-assessment. He has further contended that the assessee has participated in the re-assessment proceedings and never raised any objection about the notice under section 143(2), therefore, the assessee has surrendered to the jurisdiction of the AO and cannot be allowed to raise this objection a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the provisions of Section 142, subsection (2) and (3) of Section 143, Section 144 and Section 145 shall, so far as may be, apply." An analysis of this sub section indicates that, after the return is filed, this clause enables the assessing officer to complete the assessment by following the procedure like issue of notice under Sections 143(2)/142 and complete the assessment under Section 143(3). This Section does not provide for accepting the return as provided under Section 143(i)(a). The assessing officer has to complete the assessment under Section 143(3) only. In case of default in not filing the return or not complying with the notice under Sections 143(2)/142, the assessing officer is authorized to complete the assessment exparte under Section 144. Clause (b) of Section 158 BC by referring to Section 143(2) and (3) would appear to imply that the provisions of Section 143(1) are excluded. But Section 143(2) itself becomes necessary only where it becomes necessary to check the return, so that where block return conforms to the undisclosed income inferred by the authorities, there is no reason, why the authorities should issue notice under Section 143(2). However, if an asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mandatory but optional and are to be applied to the extent practicable. In support of that contention, the learned counsel has relied on the observation made by this Court in Dr. Pratap Singh's case [1985] 155 ITR 166 (SC). In this case, the Court has observed that Section 37(2) provides that "the provisions of the Code relating to searches, shall so far as may be, apply to searches directed under Section 37(2). Reading the two sections together it merely means that the methodology prescribed for carrying out the search provided in Section 165 has to be generally followed. The expression "so far as may be" has always been construed to mean that those provisions may be generally followed to the extent possible. The learned counsel for the respondent has brought to our notice the observations made by this Court in the case of Maganlal Vs. Jaiswal Industries, Neemach and Ors., [(1989) 4 SCC 344], wherein this Court while dealing with the scope and import of the expression "as far as practicable" has stated "without anything more the expression `as far as possible' will mean that the manner provided in the code for attachment or sale of property in execution of a decree shall b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is already available on record, in such a case if the assessee has participated in the assessment proceedings in response to the notice under section 143(2), then subsequently the assessee cannot take the objection of notice issued under section 143(2) was not properly served on the assessee. Since it is a case of non-issuance of notice under section 143(2), therefore, the initiation of scrutiny proceedings itself was without jurisdiction conferred by the provisions of section 143 of the Act. The Hon'ble Kerala High Court in the case of Travancore Diagnostics Pvt. Ltd. vs. ACIT (supra) has dealt with the issue of validity of reassessment order passed by the AO without issuing notice under section 143(2) in para 33 & 34 as under :- "33. The extended question then is whether even if the assessee is deemed to have participated in the proceedings under Section 143, even without the Assessing Officer having issued the mandatory notice, would the Revenue be entitled to the benefit provided under Section 292BB of the Act. Section 292BB creates an estoppel against the assessee in claiming that no notice has been served on him, if he has participated in the proceedings. However, the said ..... X X X X Extracts X X X X X X X X Extracts X X X X
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