PREKSHA TEXTILE PVT. LTD.,,AHMEDABAD vs. THE INCOME TAX OFFICER, WARD-3(1)(4),, AHMEDABAD

PER Ms. MADHUMITA ROY - JM:

The instant appeal filed by the assessee is directed against the order dated 25.10.2019 passed by the Commissioner of Income Tax (Appeals) – 4, Ahmedabad arising out of the order dated 29.12.2016 passed by the ITO, Ward-3(1)(4), Ahmedabad under Section 143 r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred as to ‘the Act’) for Assessment Year 2010-

We have particularly perused the entire set of records which was supplied to the appellant upon disposing of the application under RTI Act, 2005 under Section 7(1) of the said Act which do not show any such issuance of notice under Section 143(2) of the Act. It is pertinent to mention that the entire files/records were supplied as applied for under this RTI Act, 2005 by the appellant and therefore, there should not have been any probability of having any other separate pages got misplaced during transit as claimed by the Ld. CIT(A). We have also taken note of the submissions and perused the letter dated 31.07.2020 supplied by the Ld. AO which clarifies that no such notice under Section 143(2) is found to have been served upon the assessee. Further that the Ld. AO mentioned all the notices issued by him in the Assessment Order passed under Section 143(3) of the Act. But there was no mentioning of the notice issue under Section 143(2) of the Act which substantiates that no such notice under Section 143(2) of the Act was even issued by the Ld. AO. Under this circumstances, we do not hesitate to come to the conclusion that the notice under Section 143(2) of the Act was not issued at all by the authorities below. The second question as to whether in the absence of issuance of notice under Section 143(2), the reopening under Section 147 of the Act is valid or not has been argued by the Ld. Senior Counsel for the assessee in favour of the assessee relying upon the judgment passed by the Hon’ble Asst. Year –2010-11 Juri ictional High Court in the matter of CIT vs. Sukhini P. Modi reported in [2014] 52 taxmann.com 50 (Gujarat), a copy whereof has been submitted before us. In that particular matter both the Ld. CIT(A) and the Ld. Tribunal were pleased to hold that procedure prescribed for issuance of notice under Section 143(2) were not followed and therefore, the assumption of the juri iction of issuance of notice of reopening itself would not be sustainable. Relying upon the judgment passed by the Hon’ble Apex Court the Hon’ble Juri ictional High Court was pleased to find no reason of requirement to indulge into the concurrent findings of both the authorities in the absence of fulfillment of mandatory requirement of issuance of notice under Section 143(2) of the Act. The relevant portion of said judgment is as follows:- “8. The apex court in the case of Asstt. CIT v. Hotel Blue Moon [2010] 321 ITR 362/188 Taxman 113 has considered the very issue. The apex court held that the Assessing Officer has to necessarily follow the provisions of section 142 and sub- sections (2) and (3) of section 143. It did not accept the submission of the Revenue that the requirement of the notice under section 143 can be dispensed with and the same is mere procedural irregularity. In the words of the apex court, it is held as under (page 370): “The case of the Revenue is that the expression ‘so far as may be apply’ indicates that it is not expected to follow the provisions of section 142, sub- sections (2) and (3) of section 143 strictly for the purpose of block assessments. We do not agree with the submissions of the learned counsel for the Revenue, since we do not see any reason to restrict the scope and meaning of the expression’ so far as may be apply’. In our view, where the Assessing Officer in repudiation of the return filed under section158BC(a) proceeds to make an enquiry, he has necessarily to follow the provisions of section 142, sub-sections (2) and (3) of section 143.”

Respectfully relying upon the above ratio laid down by the juri ictional High Court we do not hesitate to quash the entire proceeding under Section 147 of the Act in the absence of issuance of statutory notice under Section 143(2) of the Act upon the appellant. The assessee’s appeal is, thus, allowed.

आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt.