SIKA PROPERTIES PVT LTD,MUMBAI vs. ITO WARD 3(3)(2), MUMBAI

सुनवाई की तारीख/Date of Hearing : 24/09/2025 घोषणा की तारीख/Date of Pronouncement : 26/09/2025 आदेश/O R D E R PER NARENDRA KUMAR BILLAIYA, AM: & 4816/Mum/2025 are two separate appeals by the assessee preferred against two separate orders dated 22/05/2025 and 21/05/2025 by NFAC, Delhi, pertaining to AY 2005-06 and 2006-07 respectively.

2) The learned CIT(A) NFAC erred in law and on facts in not providing an opportunity of personal hearing before dismissing our appeal by disallowing condonation of Delay.

3) The learned CIT(A) NFAC erred in law and on facts in not dealing with the following Grounds of Appeal on merits, that clearly indicated that the order passed by the assessing officer u/s 147 r.w.s.254 of the Act was in not in accordance with the direction of Hon'ble ITAT "H" Bench vide order dated 09.06.2017 i) The order passed by the learned assessing officer is bad in law and should be quashed in as a) while giving effect to the order of Hon'ble ITAT the learned assessing officer did not follow directions mentioned therein. b) the learned assessing officer erred in law and on facts on incorrectly relying upon S.292BB ii) Without prejudice, the order passed by learned assessing officer was served after almost 20 months much after the limitation period specified u/s 153 of the Act should be considered as void and as it was neither accompanied by Notice of Demand and Income Tax Computation Form nor provided thereafter despite reminders.

Your appellant craves leave to add to alter or vary any of the Grounds of Appeal set out herein above.”

3. This is the second round of litigation. In the first round of litigation, the quarrel travelled up to the Tribunal and the Co-ordinate Bench in & 3353/Mum/2015, held as under:- “We have heard the counsel for both the parties and we have also perused the material place on record as well as the orders passed by revenue authorities. We find that the assessee himself suo moto offered such income in the return of income filed for AY 2009-10 to 2013-14 under the head income from house property. Since the assessee himself has "suo moto' offered such income under the head 'income from house property, therefore the AO was competent to reopen the assessment for the year under consideration. However, it has been brought to our notice by Ld. AR that the AO has failed to issue notice u/s 143(2) of I.T. Act prior to the finalizing re-assessment order. In this respect, Ld. AR relied upon the judgment of Hon'ble Bombay High Court in the case of ACIT Geno Pharmaceutics Ltd. (2013) 32 taxmann.com 162 (Bombay) wherein it has been held that notice u/s 143(2) is mandatory and in the absence of such service, the AO cannot proceed to make an inquiry on the return filed in compliance with the notice issued u/s 148. At this stage we had sought specific clarification on this point from Ld. DR but he was unable to specify the bench in respect of issuance of notice u/s 143(2) prior to finalizing the reassessment order. Therefore, while considering the interest of justice, we remit the matter back to the file of AO with a direction to verify as to whether notice u/s 143(2) has been I.T.A. No. 4817 & 4816/Mum/2025 Assessment Year: 2005-06 & 2006-07 3 issued to the assessee before computation of reassessment proceeding and in case no notice has been issued before finalizing the re-assessment order, then while complying with the orders passed by Hon'ble Bombay High Court in the case of ACIT Vrs. Geno Pharmaceuticals Ltd. The reassessment order passed by AO is not legally sustainable as in the absence of notice u/s 143(2), the AO could not have proceeded to make an inquiry on the return filed in compliance with the notice issued u/s 148.”

4. Pursuant to the aforementioned directions of the Co-ordinate Bench while giving effect to the order of the Tribunal, the AO observed as under:- “Consequent upon the Order of the Hon'ble ITAT's order & 3353/Mum/2015 for AYs 2005-06 & 2006-07 dtd. 09.06.2017, the total income of the assessee is as per order u/s 143(3) r.w.s. 147 of the I.T. Act dtd. 20.12.2012. As per the directions issued by the Hon'ble ITAT, the issue is verified and since the assessee has appeared in the assessment proceeding, the assessee is covered under the provisions of Section 292BB of the IT Act. Total Income remains same as per per order u/s 143(3) r.w.s. 147 of the I.T. Act dtd. 20.12.2012 i.e. Rs.19,47,890/-. Give credit for prepaid taxes after due verification. Interest u/s 234A, 234B,234C and 234D is charged as per law.”

“292BB. Notice deemed to be valid in certain circumstances. – Where an assessee has appeared in any proceeding or cooperated in any inquiry relating to an assessment or reassessment, it shall be deemed that any notice under any provision of this Act, which is required to be served upon him, has been duly served upon him in time in accordance with the provisions of this Act and such assessee shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was – (a) Not served upon him; or (b) Not served upon him in time; or (c) Served upon him in an improper manner:

Provided that nothing contained in this section shall apply where the assessee has raised such objection before the completion of such assessment or reassessment.”

On the other hand, Mr. Ankit Vijaywargia, learned Advocate, appearing for the Respondent submitted that the notice under Section 143(2) of the Act was never issued which was evident from the orders passed on record as well as the stand taken by the Appellant in the memo of appeal. It was further submitted that issuance of notice under Section 143(2) of the Act being prerequisite, in the absence of such notice, the entire proceedings would be invalid.

The scope of the provision is to make service of notice having certain infirmities to be proper and valid if there was requisite participation on part of the assessee. It is, however, to be noted that the Section does not save complete absence of notice. For Section 292BB to apply, the notice must have emanated from the department. It is & 4816/Mum/2025 Assessment Year: 2005-06 & 2006-07 5 only the infirmities in the manner of service of notice that the Section seeks to cure. The Section is not intended to cure complete absence of notice itself.