MR.PARVEEZ RAHIM KHAN,BANGALORE vs. INCOME TAX OFFICER, WARD-8(1), BANGALORE

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ITA 1273/BANG/2014Status: DisposedITAT Bangalore30 June 2016AY 2009-103 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that without a valid service of notice under Section 143(2), the AO could not assume jurisdiction to frame the assessment. Consequently, the assessment framed was illegal and bad in law.

What were the facts?

The Assessing Officer (AO) framed an assessment without serving a notice under Section 143(2) of the Income Tax Act, 1961. The AO's assessment order itself admitted that the notice could not be served.

What were the issues?

Whether an assessment framed without proper service of notice under Section 143(2) is valid and whether penalty levied consequent to such assessment is sustainable.

Which sections of the Income-tax Act were involved?

Section 143(2),Section 144,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, SMC “C” BENCH : BANGALORE

Before: SHRI SUNIL KUMAR YADAV

For Appellant: Shri Ravishankar, Advocate
For Respondent: Smt. Swapna Das, Jt. CIT(DR)
Hearing: 28.06.2016Pronounced: 30.06.2016

O R D E R These appeals are preferred by the assessee against the respective order of the CIT(Appeals), LTU, Bangalore dated 28.05.2014 for the assessment year 2009-10. is an appeal filed against the order of the CIT(Appeals) confirming the additions made by the AO, whereas the other appeal bearing is against the order of the CIT(Appeals) confirming the penalty levied u/s. 271(1)(c) of the Income-tax Act, 1961 [“the Act”].

3.

During the course of hearing of the appeals, the ld. counsel for the assessee invited our attention to the assessment order in the quantum appeal with the submission that the AO has not served any notice u/s. 143(2) of the Act upon the assessee. Therefore, in the absence of valid service of notice u/s. 143(2) of the Act, the Assessing Officer has not assumed jurisdiction to frame the assessment upon the assessee. Thus, the assessment framed deserves to be quashed.

4.

The ld. counsel for the assessee has also invited our attention to the assessment order with the submission that in the assessment order itself, the AO has mentioned that notice u/s. 143(2) of the Act could not be served upon the assessee. In the light of the admission of the AO, the fact regarding the non-service of notice u/s. 143(2) of the Act cannot be disputed.

5.

Per contra, the ld. DR placed reliance upon the order of CIT(Appeals).

6.

During the course of hearing of the appeal, a specific query was put to the ld. DR with regard to the service of notice u/s. 143(2) of the act upon the assessee, but the ld. DR could not demonstrate any evidence with regard to service of the notice u/s. 143(2) upon the assessee. Moreover, the observation of the AO in the assessment order with regard to non- service of notice u/s. 143(2) of the Act was also not disputed by the ld. DR. In light of these facts, where a notice u/s. 143(2) of the Act has not been served upon the assessee, the AO could not assume jurisdiction to frame the assessment u/s. 144 of the Act. Therefore, the assessment framed without service of notice u/s 143(2) of the Act is illegal and bad in law. Therefore, we quash the assessment.

7.

Since the assessment is annulled, the penalty proceedings initiated consequent to the said assessment order has no legs to stand. Therefore, we also set aside the order of the CIT(Appeals) and delete the penalty.

8.

In the result, the appeals of the assessee are allowed.

Pronounced in the open court on this 30th day of June, 2016.

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