S. BHAGAWAN,BANGALORE vs. ITO, BANGALORE

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ITA 1075/BANG/2016Status: DisposedITAT Bangalore30 September 2016AY 2006-075 pages
AI SummaryRemanded

What did the Tribunal hold?

The CIT(A) did not address the issue of the mandatory notice u/s 143(2). Therefore, the matter is restored back to the CIT(A) to decide this issue after providing an opportunity to the assessee.

What were the facts?

The assessee filed a return of income for AY 2006-07. The AO issued a notice u/s 148 to reopen the assessment. The assessee contended that no notice u/s 143(2) was served, which is mandatory for jurisdiction.

What were the issues?

Whether the assessment order passed u/s 147 read with 143(3) is valid without the mandatory service of notice u/s 143(2)?

Which sections of the Income-tax Act were involved?

Section 148,Section 143(2),Section 147,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BENCH- A, BANGALORE

Before: SHRI A.K GARODIA & SMT. ASHA VIJAYARAGHAVAN

For Appellant: Shri Shyam Chakravarthy, CA
For Respondent: Shri Tshering Ongda, JCIT

PER ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER

1.

This appeal by the assessee is directed against the order of Commissioner of Income-tax (Appeals) - 5, Bengaluru dated 3/3/2016 and it pertains to the assessment year 2006-07.

2 2. The assessee is an individual filing his return of income regularly. For the impugned year, the assessee has filed his return of income in the capacity of an individual declaring salary income of Rs.4,62,510/- on 12/7/2006. There was no scrutiny assessment made in the case of assessee.

3.

Notice u/s 148 dated 27/3/2013 was issued to the assessee re- opening the case for the year 2006-07. The notice was issued in the name of S Bhagawan and Others. In response to the notice u/s 148 of the Act, the assessee vide letter filed on 1/4/2013, request for issue of reasons recorded for issuing the notice u/s 148. The assessee further stated that, he has no income liable to be taxed during the impugned assessment year which has escaped assessment. No notice u/s 143(2) and u/s 142(1) was served on the assessee for the impugned year under consideration.

4.

Aggrieved by the order of AO, the assessee preferred an appeal before the CIT(A) and one of the grounds raised was with respect to non issuance of notice u/s 143(2). The assessee had submitted as follows

“10.1 It is submitted that the learned AO pursuant to the issue of notice u/s 148 of the Act has not served notice u/s 143(2) of the Act. Service of notice u/s 143(2) of the Act is mandatory to assume jurisdiction under the Act. When an order has to be passed u/s 143(3) read with 147 of the Act, service of notice u/s 143(2) is sine qua non. In case the notice u/s 143(2) is not issued the proceedings under the Act is null and void. In the instant case, notice u/s 143(2) was never served on the assessee and hence there is a legal defect in the order passed u/s 147 read with 143(3) and this defect is not curable.

10.2 The Hon’ble Supreme Court in the cse of ACIT & Another Vs. Hotel Blue Moon has held as under:-

“If an assessment has to be completed u/s 143(3) read with 1158BC, notice u/s 143(2) should be issued within one year from the date of filing f the block return. Omission on the part of the assessing authority to issue notice u/s 143(2) cannot be a procedural irregularity and is not curable. Therefore, the requirement of notice u/s 143(2) cannot be dispensed with”

4 Hence it is prayed before your goodself to hold that the notice u/s 143(2) was served on the assessee and the assessment order passed is without jurisdiction and the same requires to be canceel3d in total in the interest of equity and justice.

5.

The CIT(A) vide its order dated 3/3/2016 had not discussed or given any finding with respect to issuance of notice u/s 143(2).

In this circumstance, the matter is restored back to the file of the CIT(A), who shall decide the issue in accordance with law after giving an opportunity to the assessee.

6.

In the result, the appeal is set aside for statistical purpose.

Order pronounced in the open court on 30th September, 2016.

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