M/S JOSH BUILDERS & DEVELOPERS PVT LTD vs. PRINCIPLE COMMISSIONER OF INCOME TAX-1 CHANDIGARH

ITA/119/2016HC Punjab & HaryanaPHHC01110301201609 September 2016Author: MR. JUSTICE M.M. AGGARWAL,MR. JUSTICE AVNEESH JHINGAN8 pages
AI SummaryDismissed

What were the facts?

The assessee, M/s Josh Builders & Developers Pvt. Ltd., is appealing an order of the Income Tax Appellate Tribunal (Tribunal) for Assessment Year 2011-12. The appeal challenges the validity of assessment proceedings due to the alleged non-issuance or non-service of a valid notice under Section 143(2) of the Income Tax Act, 1961. During a survey operation on September 9, 2010, the assessee surrendered `1,00,00,000/- as income from business, which was declared as closing stock but offset against business loss. The Assessing Officer added this amount to the income. The Commissioner (Appeals) annulled the assessment, finding earlier notices invalid and lacking proof of service for a notice dated August 20, 2013. The Revenue appealed to the Tribunal, which, relying on Section 292-BB, reversed the Commissioner's order, holding the August 20, 2013 notice valid.

What did the High Court hold?

The High Court held that the Tribunal had essentially decided questions of fact and that the appeal raised no substantial questions of law. Regarding the first issue, the Tribunal, after examining the Dispatch Register and Speed Post entries, factually determined that the notice dated August 20, 2013, was validly issued and served. The Court found that the Tribunal's conclusion that the assessee had not raised an objection to the notice dated August 20, 2013, during assessment proceedings was also a finding of fact, supported by the assessee's reply which only objected to notices issued before the return filing date. Therefore, the Tribunal's reversal of the CIT(A)'s order was not perverse. Concerning the second issue, the Court agreed with the Tribunal that Section 292-BB was applicable. The Tribunal's finding that the assessee had participated in the proceedings without raising an objection to the notice dated August 20, 2013, meant that the assessee was precluded from objecting to its service. The Court found the Tribunal's decision to be a possible view and not perverse, thus dismissing the appeal.

What were the issues?

1. Whether the Hon'ble Tribunal acted illegally and perversely by reversing the order of the CIT (A) and restoring that of the Assessing Officer when neither notice under Section 143(2) of the Act was issued nor served during the assessment proceedings? 2. Whether the Hon'ble Tribunal was right in law in applying the provisions of Section 292-BB of the Act when the notice, though not proved to be issued by the Assessing Officer, was also not served on the assessee-company? Assessee's contentions: The assessment should be annulled as no valid notice under Section 143(2) was issued and served. The notice dated August 20, 2013, relied upon by the Revenue, was fabricated, evidenced by the same serial number in the Dispatch Register being allotted to two different notices (Section 143(2) and 142(1)). Furthermore, the assessee contended that an objection regarding the invalidity of the notice was raised before the Assessing Officer. Revenue's contentions: The Revenue produced evidence of the notice dated August 20, 2013, including Speed Post entries and the Dispatch Register, to prove service. It was argued that the assessee never raised an objection regarding non-service of notice during assessment proceedings, and therefore, Section 292-BB of the Act precluded the assessee from raising such an objection.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 143(2),Section 133-A,Section 292-BB,Section 142(1)

AI-generated summary — verify with the full judgment below

I. T. A. No. 119 of 2016 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. Case No. : I. T. A. No. 119 of 2016 Reserved On : September 01, 2016 Pronounced On : September 09, 2016

M/s Josh Builders & Developers Pvt. Ltd. .... Appellant vs.

The Principle Commissioner of Income Tax-I, Chandigarh

.... Respondent CORAM : HON'BLE MR. JUSTICE S. J. VAZIFDAR, CHIEF JUSTICE. HON'BLE MR. JUSTICE DEEPAK SIBAL. * * * Present : Mr. Sanjay Bansal, Senior Advocate with Mr. Brij Mohan Monga, Advocate for the appellant. Ms. Urvashi Dugga, Advocate for the respondent. * * * DEEPAK SIBAL, J. : The present appeal filed under Section 260-A of the Income Tax Act, 1961 (for short – the Act) is at the instance of the assessee and impugns therein the order passed by the Income Tax Appellate Tribunal, Chandigarh (for short – the Tribunal). In the present appeal, which pertains to the Assessment Year 2011-12, the appellant (hereinafter referred to as – the assessee) seeks annulment of the assessment proceedings on the ground that preceding such assessment, no valid notice, as contemplated under Section 143(2) of the Monika 2016.09.0

The order continues below.

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