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Income Tax Appellate Tribunal, DELHI BENCH ‘G’, NEW DELHI
ORDER PER C.M.Garg, J.M.
Above captioned appeal of the Revenue as well as cross objection of the assessee have been preferred against the order of CO no. 86/Del/2013 2 Shah Javed Saddat the Commissioner of Income Tax (Appeals) Muzaffarnagar dated 01.11.2012 in appeal no. 284/11-12/MZR for AY 2009-10.
The ld. Departmental Representative (DR) agreed that the arguments on the cross objection of the assessee may kindly be heard. Therefore, we have heard argument of both the sides on the cross objections of the assessee and also carefully perused the relevant material placed on record before us. The cross objection of the assessee read as under :- “1. The Commissioner of Income Tax (Appeals) has not adjudicated upon the ground of appeal
that the order under section143(3) was not valid as notice under section 143(2) was not served on the respondent.
2. The Commissioner of Income Tax (Appeals) should have observed that the notice under section143(2) was not valid fr not providing any reasonable time for compliance to the respondent.”
3. First of all, the ld. Departmental Representative (DR) posed a legal objection that the assessee did not press his legal ground no. 5 before the CIT(A) during first appellate proceedings and ground no 5 of the assessee challenging the service of the notice u/s 143(2) of the Act of the Income Tax Act, 1961( for short as the Act) has been dismissed as not pressed, therefore, the assessee cannot rasied this issue by way of cross objection.
4. The ld. Assessee’s Representative (AR) fairly accepted that the assessee did not press ground no. 5 before the CIT(A). However, the ld AR drawing our attention towards paragraph no. 3.3.1 of the CIT(A) pointed out that the assessee did not press ground no. 5 with a request that if the case was considered by the first appellate authority on merits of additions made then he verbally submitted not to press the relevant ground no. 5 and the CO no. 86/Del/2013 3 Shah Javed Saddat same was dismissed. The ld. AR vehemently contended that when the CIT(A) granted relief to the assessee on merits and the revenue is not accepting the same and further challenging the conclusion by way of filing appeal before the Tribunal then the assessee has no alternate but to re-agitate the legal objection by way of cross objection which was posed before the CIT(A) as ground no. 5.
5. On carefully consideration of above rival submissions of both the sides, we are of the considered view that the assessee did not press legal ground no. 5 before CIT(A) to narrow down the dispute which resulted into relief for him from the CIT(A) on merits. However, the revenue filed an appeal challenging the order of the CIT(A) which granted relief to the assessee, therefore, the assessee cannot be prevented to agitate the legal ground challenging the validity of service of notice u/s 143(2) of the Act. Hence, legal objection of the ld. DR is dismissed.
The ld. AR drawn our attention towards letter dated 7.11.2011 from the office of the Sr. Post Master, Saharanpur wherein the ITO, Saharanpur was informed about the service of the notice on the assessee that speed post U/R has not received in the office of the Sr. Post Master for delivery. The Ld. AR vehemently contended that when the respective Sr. Post Master did not receive the speed post wherein the notice u/s 143(2) of the Act was issued to the assessee then valid service on the notice of the assessee cannot be presumed. Placing reliance on the decisions of Hon’ble High Court of Delhi in the case of CIT vs. silver Streak Trading P. Ltd. reported as 326 ITR 418. The ld. Counsel pointed out that as per facts submitted by the revenue, notice was issued on 30.8.2010 CO no. 86/Del/2013 4 Shah Javed Saddat fixing the date of hearing on 31.8.2010 which a mockery of proceedings as if it is presumed that the notice issued to the assessee will be served on 31.8.2010 then also how the assessee would be able to submit his reply before the authority concern on the same day i.e. 31.8.2010. The ld. AR further pointed out that even assuming but not accepting that the notice was served on the assessee on 31.8.2010 then no sufficient time was given to the assessee for submitting his reply therefore it is a clear violation of principles of natural justice by the AO. For this proposition the Ld. AR to support has placed reliance on the following decisions of Hon’ble High Court and Tribunal (i) Munna Lal Murlidhar vs. CIT reported as 79 ITR 540 (All.) (ii) M. Mohd. Ishaq vs. CIT reported as 27 ITR 510 (Punjab).
On replying to the above, Ld. DR submitted that the undisputedly and admittedly the notice was sent to the assessee through speed post under Article No. EU41939695IN on 30.8.2010 on the address “Mohalla Khanqua Shareef, Ambeta Peer, Saharanpur”. In this situation compliance of section 143(2) of the Act has to be held as complied. The Ld. DR drawn our attention towards copies of the notice available at page 4 of the assessee’s paper book submitted that the first notice was issued on 23.8.2010 which was handed over to the postal authorities on 30.8.2010 for service upon the assessee within prescribed time, therefore, legal objection of the assessee is not sustainable.
On carefully consideration of rival submissions of both the sides at the very outset we may point out that as per proviso to of Section 143(2)(ii) of the Act no notice under said clause (ii)
CO no. 86/Del/2013 5 Shah Javed Saddat shall be served on the assessee after expiry of 6 months from the end of the financial year in which the return is furnished. In the present case, as per assessment order, the assessee filed his return of income on 30.4.2009 and notice u/s 143(2) of the Act could be validly served on the assessee on or before 30.9.2010. In this situation as per proviso to section 143(2)(ii) of the Act it is mandatory that the notice under this provision should be served upon the assessee within 6 months from the end of relevant financial year wherein the return was filed. In the present case, the ld. DR is harping on the fact that the AO issued notice on 30.8.2010 which was pressed into service through postal authorities on 30.8.2010 by way of handing over the envelope to the postal authorities but the ld. DR could not show any proof of service upon the assessee on or before 30.9.2010.
At this stage, it is pertinent to take cognizance of the fact informed by the Sr. Post Master, Saharanpur to the ITO/AO by letter dated 7.11.2011 wherein it was informed to the AO that speed post under receipt has not been received to the post office for delivery. When the envelope containing notice u/s 143(2) of the Act issued against the assessee was not received by the office concern for service upon the assessee then it cannot be presumed that the same was validly served upon the assessee. Per contra, under above noted facts and circumstances it can safely be presumed that the revenue department could not establish the very fact of valid service of notice upon the assessee u/s 143(2) of the Act within the prescribed limit mandated by proviso to section 143(2) (ii) of the Act i.e. on or before 30.9.2010. Therefore, we are inclined to hold that no notice CO no. 86/Del/2013 6 Shah Javed Saddat u/w 143(2) of the Act was served upon the assessee which a mandatory conditions for valid scrutiny assessment u/s 143(3) of the Act. Therefore, impugned assessment order dated 28.12.2011 is quashed being bad in law and void ab initio. Accordingly, cross objections of the assessee are allowed.
9. Since by the earlier part of this order, we have allowed cross objections of the assessee quashing the impugned assessment order, therefore, grounds raised
by the revenue on merits in its appeal becomes academic and infructuous and we dismiss the same being infructuous.
10. In the result, cross objections of the assessee is allowed and appeal of the revenue is dismissed being infructuous. Order Pronounced in the Court on 19/02/2016.