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Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR
Before: SHRI D. KARUNAKARA RAO, AM & SHRI VIKAS AWASTHY, JM
ORDER
PER D. KARUNAKARA RAO, AM:
This appeal is filed by the assessee against the order of CIT(A)-I, Nagpur dated 23.12.2013 for the Assessment Year 2004-05.
Briefly stated the relevant facts include that the assessee is a firm and is engaged in the business of real estate, construction and developers. The assessee filed the return of income declaring total income of Rs.55,45,297/-. The assessment was completed u/s 143(3) r.w.s. 147 of the Act making an addition on account of short term capital gain earned on sale of plot as discussed in para 6 and others of the assessment order. The Assessing Officer computed the income of the assessee in para 7 of his order and the same is extracted hereunder :- “7. Subject to the discussion mentioned in the preceding paras, the total income of the assessee is computed as under :- Computation of Income Income from capital gain as per return NIL Add- Short term capital gain of sale of plot as discussed 55,45,297/- in preceding paras Assessed Total income (Rounded to) 55,45,297/-
The Assessing Officer made an addition on account of short term capital gains on sale of plots as discussed in para 6 and others of his assessment order. The CIT(A) confirmed the same and dismissed the appeal of the assessee.
Aggrieved with the above orders of the Assessing Officer as well as the CIT(A), the assessee is in appeal before the Tribunal with the various grounds.
Bringing our attention to the grounds, concise grounds, revised grounds and additional grounds, the ld. Counsel for the assessee submitted that the assessee raised various legal grounds relating to the service of notice u/s 148 of the Act on the right person. Further, the ld. Counsel for the assessee also raised another legal issue relating to the requirement of issuance of statutory notice u/s 143(2) of the Act. Without going into the merits related to the grounds, ld. Counsel submitted that the said additional grounds, which are legal in nature, may kindly be adjudicated on priority. For the sake of completeness, the legal grounds as filed by the assessee on 17.09.2018 are extracted hereunder :- “1. On the facts and circumstances of the case and law, the Learned CIT(Appeals)-1, Nagpur has grossly erred in holding notice u/s. 148 served by ACIT, Circle-1, Nagpur on assessee legally valid. 2. On the facts and circumstances of the case and law, the Learned CIT(Appeals)-1, Nagpur has grossly erred in upholding the validity of order passed by the A.O. u/s. 143(3) of Act without proper appreciation of the fact and position of law, where in notice u/s. 143(2)(ii) was never served on assessee by A.O.
3. On the facts and circumstances of the case and law, the Learned CIT(Appeals)-1, Nagpur has grossly erred in upholding the validity of order passed by the A.O. without proper appreciation of the fact and position of law, wherein A.O. collected evidences and recorded the statements secretly u/s. 131 from third parties (Shri Pramod Manmode and Shri Kheta Family) and deprived the assessee an opportunity to rebut the false claims made by these parties.
4. On the facts and circumstances of the case and law, the Learned CIT(Appeals)-1, Nagpur has grossly erred in upholding the validity of order passed by the A.O. without proper appreciation of the fact and position of law, disallowing the lawfully incurred expenses of Rs.54,33,239/-. 5. That, the Appellant craves leave to add, amend, alter, vary and/or withdraw any or all grounds of Appeal
.”
6. Referring to the additional ground no.2 above, in particular, ld. Counsel for the assessee submitted that this is a case where the notice u/s 143(2) of the Act was never issued to the assessee before completion of the reassessment. Referring to the orders of the Assessing Officer and the CIT(A), ld. Counsel submitted that the facts of the assessment order is very clear about the non-issuance of the said notice. The Assessing Officer discussed the issue relating to the service of notice u/s 148 of the Act only. On these facts, ld. Counsel submitted that the re-assessment order passed by the Assessing Officer is unsustainable and the same should be quashed. Consequently, all the additions made by the Assessing Officer in the reassessment proceedings and confirmed by the CIT(A) will have to be deleted. The ld. Counsel for the assessee further submitted that this is a case where the assessee never received notice u/s 148 of the Act and request the Bench to direct the Assessing Officer to produce the evidence in support of the said notice.
7. On the other hand, ld. DR for the Revenue relied heavily on the orders of the Assessing Officer and the CIT(A).
8. On hearing both the sides on this legal issue raised in ground no.2 above, we find the said legal grounds/concise grounds/additional grounds, as the case may be, raised by the assessee have to be admitted and adjudicated considering the legal nature of the same. On perusal of the assessment order, we find there is no whisper about the fact of issue of notice u/s 143(2) of the Act. It is not the case of the Revenue that the said notice was, in fact, issued and served on the assessee before reassessment was made. Considering the undisputed facts, we are of the opinion that the legal ground related to the issue of notice u/s 143(2) of the Act has to be admitted and decided in favour of the assessee. Accordingly, the relevant grounds are treated as allowed.