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TMI Blog2020 (12) TMI 930X X X X Extracts X X X X X X X X Extracts X X X X ..... d ab-initio and liable to be quashed. The judicial pronouncements referred and relied upon by the ld. DR are not applicable in the facts of the present case. In view of the above facts and circumstances, we quash the proceedings U/s 147/148 of the Act as invalid. Appeal of the assessee is allowed. - ITA No. 461/JP/2018 - - - Dated:- 21-12-2020 - Shri Sandeep Gosain, JM And Shri Vikram Singh Yadav, AM For the Assessee : Shri Shravan Kumar Gupta (Adv) For the Revenue : Ms. Chanchal Meena (Addl.CIT) ORDER PER: SANDEEP GOSAIN, J.M. The present appeal has been filed by the assessee against the order of the ld. CIT(A), Kota dated 15/01/2018 for the A.Y. 2010-11 wherein the assessee has raised following grounds of appeal: 1.1 The impugned order u/s 147/144 dated 16.03.2016 is bad in law and on facts of the case, for want of jurisdiction, barred by limitation and various other reasons and hence the same may kindly be quashed. 1.2 The action taken u/s 147 is bad in law and on facts of the case, for want of jurisdiction and various other reasons and hence the same may kindly be quashed. 2. The Id. AO has grossly erred in law as well as on the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law and facts, may kindly be deleted in full. 8. The appellant prays your honor indulgences to add, amend or alter of or any of the grounds of the appeal on or before the date of hearing. The assessee has also raised additional ground of appeal, which are reproduced below: Add. GOA 1 : Further alternatively and without prejudice to the GOA-3, if the entire or part addition out of addition of ₹ 16.49,204/- is sustained, then Id. AO may kindly be directed to allow the deduction of ₹ 25,27,142/- u/s 54F shown in the return and actually incurred, in place of ₹ 10,97,040/- claimed being the reaming deduction after claiming deduction u/s 54B and AO may verify the claim by its process and the !d. AO and C1T(A) both have gro,;sly erred in not doing so. Hence the same may kindly be directed and delete the addition to that extent. Add. GOA-2 : The Id. CIT(A)has grossly erred in law as well as on the facts of the case in confirming in enhancing the addition of ₹ 1,40,000/- on account of brokerage or commission paid on purchase of property and reduced the claim from ₹ 17,07,290/- to ₹ 15,67,290/- u/s 54B, without giving any show cause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -availability of evidence has disallowed the land development claim of ₹ 12,52,560/- after indexation of ₹ 16,49,204/-. The A.O. has also observed that the assessee has received ₹ 70,00,000/- from the purchaser on various dates. Hence the AO has asked the assessee about the excess deposits in bank account then to DLC rate and may not be added of these ₹ 2,00,000/- in the total income. In response thereto the assessee has submitted that assessee has sold agriculture land for ₹ 68.00 lacs and the land was sold with standing crops for that crops, the assessee has received ₹ 2,00,000/- of that crop, hence a cheque No. 062227 dated 29.04.2009 related to sale of agriculture crop. The A.O. had not satisfied with the explanation of the assessee and made addition. The AO has further observed that the assessee has claimed deduction of ₹ 10,97,040/- u/s 54F and alleged that the assessee has not filled any evidence in support of claim. The AO has asked the details of expenses in construction in house property of ₹ 25,27,142/-. No proper explanation was submitted by the assessee then the A.O. has disallowed deduction of ₹ 10,97,040/-. The AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment record. 2. No date of reasons recorded: Further from the perusal of the reasons recorded(PB 2) it is not clear that when the reasons has been recorded when the sanction of the Add.CIT or CIT has been received, also not appearing that there was the satisfaction of the Add. CIT or Pr. CIT etc all these are absent on the reason recorded as provided by the ld. AO. Thus the proceedings for reasons recorded and details is also not as per law, inaccurate and improper and liable to be quashed. As per reasons recorded it is clear that the reasons are not proper and not sufficient. And it appears from the reasons that at the time of recording the reasons the ld. AO was having only information and not any material evidence, because there is no mention in what amount land sold and what is the DLC rate etc. Hence how it can be said that there was reasons to believe and satisfaction of the AO and Pr. CIT Add. CIT. On the basis of the invalid, improper and insufficient and in want of satisfaction of higher authority, no notice or reopening can be done. As per the language and settled legal position that the ld. AO must have reason to believe not reason to suspect and as per the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to be deleted in full. (C) SUBMISSIONS : On GOA 3,4,5 and Add. GOA1 1.1. In this regard we have to submit that the assessee has claimed land development exp. of ₹ 12,52,560/- incurred in the year 2004-05 and after indexation 16,49,204/-. On being asked the details and evidences of land development expenses by the ld. AO, had stated that the expenses is 12-13 years old which has been incurred for JCB Machine levelling, Mitti Purchase for better crops, tractor hiring charges etc and asked to allow the time of one month. Hence the ld. AO in want of evidence has disallowed the land development claim of ₹ 12,52,560/- after indexation of ₹ 16,49,204/- and the ld. CIT(A) has also not provided the adequate opportunity of being heard he has only three opportunity i.e on 2408.17, 06.09.2017 and 08.11.2017. But the assessee was being the lady and was depended on the counsel and due to some misunderstanding and communication gap between the assessee and her counsel the proper evidences and details could not be filled before the lower authority. Because the counsel was at Kota and the assessee was residing at Vivekand Puram Bundi. 2.2 Further when the assessee has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sustained, then ld. AO may kindly be directed to allow the deduction of ₹ 25,27,142/- u/s 54F shown in the return and actually incurred, in place of ₹ 10,97,040/- claimed being the reaming deduction after claiming deduction u/s 54B and AO may verify the claim by its process and the ld. AO and CIT(A) both have grossly erred in not doing so. Hence the same may kindly be directed and delete the addition to that extent . And this is also arising from the record and legal issue and it is the settled law if any claim has not been made before the lower authority the same can be claimed before the appellate authority if the assessee is entitled. Therefore we submit that if the claim of the assessee of ₹ 16,49,204/- on account of the land development Expenses by your honor then the ld. AO may kindly be directed to give the full claim of construction u/s 54F after adjustment or short fall of other deductions, if any after verification and considering our evidence. The claim should not be denied due to some technical reason. The land on which the construction was made was in the name of assessee in support we are filling the land documents and details (PB10-32). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed upon the decisions cited in the orders passed by the authorities below as well as cited before us and we have also gone through the orders passed by the revenue authorities. In this appeal, the assessee has raised several grounds and has also taken additional grounds in order to challenge the impugned order U/s 147/154 of the Act, but one the legal grounds raised by the assessee relates to non-issuance of notice U/s 143(2) of the Act by the A.O. 8. We observe that when the assessee has filed the return u/s 148 on dt. 06.01.2016 the AO has not issued the notice u/s 143(2) and without issue the notice the AO has passed the assessment order, it is very settled legal position that when the assessee filed the return in response to the notice u/s 148 of the Act. It is mandatory on the part of the AO to issue the notice u/s 143(2) when the AO has taken cognigance of such return. He has not treated the return as non-est or invalid. We also found that as no notice u/s 143(2) was sent to the assessee for reassessment u/s 148 before completion assessment or the dead line i.e. 30/09/2016, so the return submitted by the assessee has to be deemed as accepted as such. 9. We also observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or not complying with the notice under section 143(2)/142, the Assessing Officer is authorized to complete the assessment ex parte under section 144. Clause (b) of section 158BC 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 assessment is to be completed under section 143(3) read with section 158BC, notice under section 143(2) should be issued within one year from the date of filing of block return. Omission on the part of the assessing authority to issue notice under section 143(2) cannot be a procedural irregularity and the same is not curable and, therefore, requirement of notice under section 143(2) cannot be dispensed with. (emphasis added) 11. We further observe that issue of a notice u/s143(2) of the Act, is mandatory even in a reassessment proceeding initiated u/s 148 of the Act has been clearly laid down by the Hon ble ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Moon 321 ITR 362 at para 24 of the said judgment, the Hon ble Court had held that Section 143(2) was applicable to a proceedings u/s 147/148 of the Act and since provision to Section 148 of the Act, granted certain specific liberties to the revenue with regard to extension of time for serving such notices. Similar issue has been decided by the Coordinate bench of this Tribunal in the case of Shri Mahendra Kumar Sethia Vs ITO(T J) order dated 31/05/2018 wherein the Coordinate Bench has held as under: 6. Having considered the rival submissions as well as careful perusal of record we note that the Assessing Officer has not stated either in the assessment order or in the order sheets of the assessment proceedings that any notice U/s 143(2) of the Act was issued to the assessee. Even the assessment record produced before us by the Id. DR does not contain any notice issued U/s 143(2) of the Act. Thus, it is clear that there is no notice U/s 143(2) of the act issued by the AO and the reassessment proceedings in the case of the assessee were competed without issuing a notice U/s 143(2) of the Act. The Hon'ble Supreme Court in case of ACIT vs. Hotel Blue Moon(supra) has held that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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