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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
O R D E R
PER PAVAN KUMAR GADALE JM:
The assessee has filed the appeal against the order of the Commissioner of Income Tax (Appeals)-45, Mumbai passed u/s 143(3) r.w.s 147 and 250 of the Act. The assessee has raised the following grounds of appeal:
1. The id. CIT (A) erred in holding that the notice u/s 148 was a valid notice.
2. The Id. CIT (A) erred in holding that the jurisdiction u/s Hemant M. Mehta HUF, Mumbai. - 2 - 147 was rightly assumed by the AO.
3. The id. CIT (A) erred in holding that the validity of assessment could not be challenged for non issue and service of notice u/s 143(2) of the Act as no such objection was raised in the course of assessment proceedings ignoring the fact that the same is a jurisdictional defect and cannot be cured even by recourse to sec.29213B of the Act.
4. The id. CIT (A) erred in holding that assessment made and consequent issue of notice of demand in the name of M/s Jewel Home and that too in the status of 'Firm' is only a mistake and such mistake will not nullify the assessment order.
5. The id. CIT(A) erred in holding that the appellant participated in the assessment proceedings without raising any objection till the completion of assessment ignoring the fact that such participation was without prejudice to its preliminary contention that the proceedings are without the authority of law.
6. The Id. CIT (A) erred in rejecting the books of account u/s 145(3) of the Act without following the due process of law.
7. The Id. CIT (A) despite having accepted that the AO could not have treated the purchases as bogus only on the basis of information received from the Addi CIT-CR, Surat, as the appellant has produced enough evidence to prove genuineness of the purchases, still he erred in giving only partial relief by directing the AO to restrict the addition to Rs.179733/- being 12.50% of alleged hawala purchases of Rs.1431861/as against 100% disallowed by the AO and in doing so he also relied on the very said information ignoring what he has held earlier. Your appellant craves leave to refer to acid to, delete, amend or alter all or any of the grounds of appeal at or before the date of hearing.
Hemant M. Mehta HUF, Mumbai. - 3 -
The Brief facts are that the Hon’ble Tribunal vide order dated 06.12.2019 has partly allowed the appeal of the assessee with directions to the Assessing officer in respect of bogus purchases and gross profit ratio. Subsequently, the assessee has filed the Miscellaneous application in MA No.246/Mum/2021 that there is a mistake apparent on record that the Hon’ble Tribunal has not adjudicated the ground of appeal
on validity of assessment but decided on the merits of the case. The Hon’ble Tribunal in MA No. 246/Mum/2021 has recalled for the limited purpose of adjudicating the issue on the jurisdiction.
3. At the time of hearing, the Ld.AR Submitted that the Assessing officer (A.O.) in the assessment proceedings has passed the order u/s 143(3) r.w.s 147 of the Act mentioning in the cause title S.no. 1. the name of the assessee as “M/s Jewel Home”, at S.no. 3. the PAN No. AACHH8909M which belongs to assessee’s HUF and at S.no 6 Status was mentioned as “Firm’’. The contentions of the Ld. AR are that the A.O has also issued the notice u/s 148 of the Act in the name of M/s Jewel Home. Hence the order passed by the A.O is devoid of merits as it was passed in the name of non existing entity and supported the submissions with the paper book and judicial decisions.
Hemant M. Mehta HUF, Mumbai. - 4 -
Contra, Ld.DR submitted that the A.O in the assessment order has mentioned the PAN correctly and the notice u/s 143(2) of the Act was issued.
We heard the rival submissions and perused the material on record. The sole crux of the disputed issue envisaged by the Ld. AR that the A.O has issued the notice u/s 148 of the Act on the non existing assessee . The Ld.AR demonstrated the copy of notice referred at page 1 of the paper book issued in the name of the M/s. Jewel Home dated 30.02.2015 without mentioning the PAN. The Ld.AR emphasized that the assessee has filed the objections and has challenged the validity of reassessment proceedings as the notice was issued in the name of M/s. Jewel Home without authority of law and there is no such assessee on record with the Income Tax Department. On perusal of the CIT(A) order on the issue of validity of assessment proceedings, the assessee has raised the additional grounds of appeal
before the CIT(A) on the illegality of the order and the notice u/s 143(2) of the Act was not received by the assessee. The Ld. AR contended that the CIT(A) having considered the fact that the assessment was made on non existing person but has failed to grant the relief.
6. We considering the facts, circumstances and the submissions of the Ld. AR find that at page 1 S.no 1 of Hemant M. Mehta HUF, Mumbai. - 5 - the assessment order the A.O has mentioned the name of the assessee M/s.Jewel Home, irrespective of the fact that no such person exist in the Income Tax Department website and also the notice was issued u/sec148 of the Act on the non existing person /assessee and the Ld.AR relied on the judicial decisions as under: 1. Pr. Commissioner of Income Tax Vs. Mohd. Rizwan Prop. Allahabad HC –ITA no.100 of 2015 dated 30-03-2017. and 2. P.N Sasikumar and Ors. Vs. CIT, 1988, 170 ITR 80, Kerala HC.
We further support our view relying on the ratio of the Honble Supreme Court decision in Pr.CIT Vs Maruti Suzuki India Ltd 416 ITR 613 ( S C ), that the notice issued on non existing person and the assessment order passed is bad in law. Accordingly, we quash the assessment order and allow the ground of appeal of the assessee.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open court on 22.03.2022.