INCOME TAX OFFICER, WARD- 1(5), SAMBA vs. M/S GANESH METAL INDUSTRIES , SAMBA

The Revenue has raised the grounds of appeal is as under:

In the second round of appeal, in compliance to the order of the ITAT in (Asr.)/ 2013, the CIT(A)granted relief to the assessee by relevant observations page 31 and 32 of the impugned order.

The Ld. DR contended that the Ld. CIT(A) was not justified in law and on fact in allowing the appeal of the assessee by holding that the notice issued u/s 143(2) of the Act on 23.09.2010 was time barred and therefore the assessment proceedings are null and void, as the case was selected under CASS on the basis of E-filed revised return. He submitted that the assessee filed the original return of income for the AY 2008-09 on 28.09.2008 and the copy of ITR- V was submitted to the department on 30.09.2008; that subsequently, the assessee filed a revised return on 24.09.2009 and that since the assessee failed to submit the copy of ITR-V in respect of the revised return filed to the CPC, as such, the AO treated the revised return as invalid although notice u/s 143(2) on 23.09.2010 only on the basis of revised return.

The Ld counsel for the assessee contended that the CIT(A)’s order is as per law and request that the impugned order may be upheld. He submitted that during the assessment proceedings, the assessee relied upon the letter referred to CBDT vide request no 127734 on 04.02.2013 and that the copy of the response dated 22.03.2013 received from CPC in which it was stated that the ITR-V was not received by the CBDT.He argued that the assessee further relied upon Rule 12(3)(iii) which enlists

Having heard the rival submission and perusal of record, it is not disputed that notice issued u/s 143(2) on 23.09.2010 only on the basis of revised return for which ITR-V was not submitted to CPC and in our view, the same would be held as invalid and non-est.

The AO issued notice u/s 143(2) on 23.09.2010 only on the basis of revised return for which ITR-V was not submitted to CPC and as such, the same is invalid and non-est. The time period for issue of notice u/s 143(2) was barred by limitation i.e. 30.09.2009 considering the original return of income filed. Accordingly, the assessment was completed on 24.12.2010 considering the invalid and non est revised return. In the 1st round of appeal, filed before the CIT(A) on 23.02.2011, the order was passed against the assessee by CIT(A) on 22.03.2013. The assessee then filed an appeal before the Hon'ble ITAT vide (Asr.)/ 2013. The Hon'ble ITAT remanded back the case to CIT(A) by allowing the appeal for statistical purposes. In 2nd round, the CIT(A) had decided the issue in the favour of assessee.

The Ld. CIT(A) stated that compliance of Rule 12(3)(iii) is mandatory and not mere directory and hence, revised return is not a valid return in the eyes of law and no cognizance can be taken of this return. On validity of the notice u/s 143(2), the CIT (A) observed as under:

Considering the facts of the case in totality, CBDT Circular and requirement of the mandate, we find no infirmity in the order of the CIT(A) in holding the assessment order passed u/s 144 dated 24.12.2010 as bad in law. Accordingly, the order of the CIT (A) is upheld. Thus, the ground of appeal of the revenue is rejected.

In the result, the appeal filed by the Revenue is dismissed.