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TMI Blog2003 (3) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... s version without proper consideration and appreciation of the material facts placed on record and also discussed in the assessment order." 2. Facts of the issue are that the Assessing Officer issued notice under section 148 of the I.T Act on 27-3-1992. In compliance to that notice the return of income was filed on 27th May 1992. Thereafter notice under sections 142(1) and 143(2) were simultaneously issued on 11th March 94. From the above it is clear that the notice under section 143(2) was issued after the completion of 12 months from the end of the month in which the return was furnished which is in contravention to the proviso to sub-section (2) of section 143 of the I.T Act, 1961. Aggrieved with the belated notice under section 143(2), the assessee filed appeal before DCIT (A), Agra who has decided that the notice under section 143(2) was not issued within the statutory time limit given in the proviso to sub-section (2) of section 143, therefore, held that the proceedings completed on the basis of such notice, the assessment order was against the provisions of the I.T Act, 1961. Hence, he annulled the impugned assessment order. Aggrieved with the above decision of the DCIT (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 143. 6. As per the phrase used in section 148 - 'so far as may be, apply' (so far as may be, apply accordingly as if such return were a return required to be furnished under section 139). The recourse to other provisions may be taken only if they are applicable and only if such recourse is necessary." 5. The Ld. DR argued that as per the provisions of section 143(2), the Assessing Officer is empowered to serve the notice under section 143(2) only if he considers it necessary or expedient to ensure that the assessee has not understated the income etc. However such satisfaction is not only a pre-condition for issuance of notice under section 148 but also as per mere specific provision, such reasons have to be recorded by the Assessing Officer. Therefore, section 147 encompasses the requirement of section 143(2) i.e. when the Assessing Officer is not only satisfied about the income escaping assessment under section 147 but also records the reasons of such satisfaction, it is not necessary for the Assessing Officer to express the same satisfaction again by issuing notice under section 143(2) and therefore, to this extent the requirement of issuance of notice under section 143 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chapter XIV of the IT Act is applicable i.e. assessment can only be framed either under section 143(3) or under section 144(4) of the I.T Act. The Ld. Counsel further argued that subsection (2) of section 143 starts with the phrase - "where a return has been made under section 139 or in response to notice under sub-section (1) of section 142, the Assessing Officer shall, if he considers it necessary, or expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not underpaid the tax in any manner, serve on the assessee a notice requiring him ....". Therefore, the Ld. Counsel argued that section 148 makes the position clear that any return of income filed in compliance to notice under section 148 shall be considered as if the return of income filed under section 139. Therefore, once the return of income filed/in compliance to notice under section 148, the same shall be considered as the return filed under section 139. In such a situation, all the provisions of Chapter XIV of the I.T. Act shall be followed and as such the assessment shall be made either under section 143 or under section 144 of the I.T Act. While making assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of assessment. In this regard our attention is drawn to the Hon'ble Supreme Court's decision in the case of CIT v. Sun Engg. Works (P.) Ltd. [1992] 198 ITR 297 wherein it has been held: "It is neither desirable nor permissible to pick out a word or a sentence from the judgment of this court, divorced from the context of the question under consideration and treat it to be the complete "law" declared by this court. The judgment must be read as a whole and the observations from the judgment have to be considered in the light of the questions which were before this court. A decision of this court takes its colour from the questions involved in the case in which it is rendered and, while applying the decision to a later case, the courts must carefully try to ascertain the true principal laid down by the decision of this court and not to pick out words or sentences from the judgment, divorced from the context of the questions under consideration by this court, to support their reasonings." 10. The Ld. DR further argued that the use of word "so far as may be" in section 148 of the I.T Act clearly indicates the intention of the Legislature to that only where required and where possibl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are in regard to issuance of notice for the purpose of allowing opportunity for completion of assessments. Under section 142(1) the assessee is required to appear in person along with details, whereas under section 143(2) the assessee may file details through his authorized person. Notice under section 142(1) was, issued and there is no dispute in this regard. Of course nothing is on record that whether any notice under section 143(2) was issued or not, but in our considered view, there will be no difference as assessee was allowed opportunity for explaining and filing the details in regard to search material. We, further noted that even a show-cause notice was given by the Assessing Officer to the assessee for filing the details and explaining the reasons that why the additions on the basis of search material be not made and after that the assessments were completed. Therefore we hold that Assessing Officer has allowed opportunity by issuing notice under section 142(1) before completing of assessment. If by any reason notice under section 143(2) was not issued that did not make any difference as the Assessing Officer has already issued notice under section 142(1) and show-cause no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order passed under section 143(3) as invalid. Therefore, the assessment framed under section 143(3), read with section 147, would be held invalid." 15. After careful consideration of the rival submissions and the decisions cited by the Ld. Counsel for the assessee as well as the Ld. DR and also considering the material before us, we are of the view that section 148 clearly says that the return of income filed in compliance to notice under section 148 shall be considered as if return were a return required to be furnished under section 139. Once the return of income was filed in compliance to notice under section 148, the provisions of section 139 shall apply due to mandatory provision of section 148. The notice under section 143(2) is not merely a procedural in nature but is mandatory provision. Once the valid return under section 148 is filed by the assessee, the provisions of section 143(2) being mandatory in nature, the non-issue of notice under this sub-section within the time limit prescribed statutorily will render the order passed under section 143(3) as invalid. Therefore, the assessment-framed under section 143(3) read with section 147 shall be invalid. In view of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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