CAPT. MANOHAR BHOLA,FARIDABAD vs. ITO, WARD-1(2), FARIDABAD
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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI
Before: SHRI SAKTIJIT DEY
IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘SMC’ NEW DELHI
BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA No. 508/Del/2019 Assessment Year: 2013-14
Capt. Manohar Bhola, Vs. ITO, Ward-1(2), Houe No. 174, Sector-14, Faridabad. Faridabad (Hr.), PIN: 121007 PAN :AANPB0044N (Appellant) (Respondent)
Appellant by Shri K.C. Singhal, Adv. Respondent by Shri Om Prakash, Sr. DR
Date of hearing 10.03.2023 Date of pronouncement 31.03.2023
ORDER This is an appeal by the assessee against order dated 30.11.2018
of learned Commissioner of Income-Tax (Appeals), Faridabad, for the
assessment year 2013-14.
At the outset, learned Authorized Representative of the assessee,
on instructions, did not press ground no.2 of the main grounds,
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challenging the addition of Rs.35,12,500. Accordingly, this ground is
dismissed.
In ground no.1 of the main grounds and the additional ground,
the assessee has challenged the validity of the assessment order passed
under Section 143(3) of the Income-Tax Act,1961, due to alleged
failure of the Assessing Officer in issuing and serving the notice under
Section 143(2) of the Act within the prescribed period of limitation.
Briefly, the facts relating to this issue are, the assessee is a
resident individual. For the assessment year under dispute, the
assessee filed his return of income on 31.07.2013 declaring income of
Rs.5,52,660. Subsequently, the assessee filed a revised return of
income on 10.11.2014 declaring income of Rs.5,52,660. Assessee’s
case was selected for scrutiny and the Assessing Officer issued a
notice under Section 143(2) of the Act on 20.08.2015. Ultimately, the
Assessing Officer completed the assessment under Section 143(3)
vide order dated 18.03.2016 adding an amount of Rs.35,12,500 under
Section 68 of the Act. Against the assessment order so passed,
assessee preferred an appeal before learned Commissioner (Appeals),
inter alia, on the ground that the assessment order is invalid due to
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non-issuance of notice under Section 143(2) of the Act within the
period of limitation. Learned Commissioner (Appeals) dismissed the
legal ground raised by the assessee on the reasoning that, since, the
assessee had participated in the assessment proceedings in pursuance
to the notice issued under Section 143(2) of the Act, the irregularity, if
any, would be cured under Section 192BB of the Act.
Before me, learned Authorized Representative of the assessee
submitted that the return of income was furnished by the assessee on
31.07.2013. He submitted, as per section 143(2) of the Act applicable
to the relevant assessment year, the Assessing Officer had time to
serve a notice under Section 143(2) of the Act before expiry of 6
months from the end of the financial year in which the return is
furnished. He submitted, in the present case, the Assessing Officer has
issued the notice under Section 143(2) of the Act on 28.08.2015,
which is much beyond the period of limitation prescribed under
Section 143(2) of the Act. He submitted, keeping in view the fact that
the assessee return of income was furnished in financial year 2013-14,
the Assessing Officer had time to issue notice under Section 143(3) of
the Act till 30.09.2014. He submitted, since, the assessee had filed the
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revised return of income after the intimation was issued under Section
143(1) of the Act, it has to be treated as invalid return, since, as per
section 139(5) of the Act, revised return can be filed any time before
expiry of one year from the end of the relevant assessment year or
before completion of assessment, whichever is earlier. He submitted,
since, the intimation under Section 143(1) of the Act was issued on
23.01.2014, the revised return of income is non est. Thus, the date of
filing of revised return, cannot be reckoned for the purpose of
limitation in issuance of notice under Section 143(2) of the Act. In
support of the aforesaid contention, learned counsel relied upon the
following decisions:
i) Vipin Khanna vs. CIT – 255 ITR 220 ( P & H); ii) Mohammed Farooque Sarang-vs-DCIT 164 ITD 573 (Mum); iii) Hari Mohan Das Tandon (HUF)-vs-PCIT 169 ITD 639 All); &\ iv) Budhewal Co-Operative Sugar Mills-v-JCIT 101 TTJ Chd.).
Learned Departmental Representative submitted, the intimation
issued under Section 143(1) of the Act cannot be treated as an
assessment order. Therefore, assessee’s contention that the revised
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return of income is non est, is unacceptable. He submitted, since, the
assessee had filed the revised return of income on 10.11.2014 falling
in financial year 2014-15, the notice under Section 143(2) issued and
served on the assessee on 20.08.2015 is within a period of six months
from the expiry of the financial year in which the revised return was
filed, hence, within the period of limitation.
I have considered rival submissions and perused the material
available on record.
As far as factual aspect of the issue is concerned, there is no
dispute that the original return of income was filed by the assessee on
31.07.2013. The return of income was processed under Section 143(1)
on 23.1.2014 and revised return of income was filed on 10.11.2014.
Keeping in perspective the aforesaid dates and events, the following
issues need to be examined:
i) Whether, the intimation issued under Section 143(1) of the Act can be treated as an assessment order so as to make the filing of revised return of income invalid in terms of section 139(5) of the Act; (ii) Whether, the notice issued under Section 143(2) of the Act can be said to be within the period of limitation, keeping in view the provisions of section 143(2) of the Act applicable to the relevant assessment year ?
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As far as the first issue is concerned, it is trite law that intimation
issued under Section 143(1) of the Act cannot be treated as an
assessment order. There are plethora of judicial precedents
propounding the aforesaid legal position. Therefore, I do not want to
discuss in detail all these decisions. Suffice to say, in case of ACIT vs.
Rajesh Jhaveri Stock Broker (P) Ltd. (2007) 291 ITR 500 (SC)
Hon'ble Supreme Court has laid down the aforesaid ratio. Thus, the
contention of learned Authorized Representative, that the revised
return of income filed after completion of assessment under Section
143(1) is to be treated as non est, is unacceptable.
Considering the fact that the revised return of income was filed
within the time prescribed under Section 139(5) of the Act, in my
view, it is a valid return.
Having held so, it is necessary now to examine the provisions of
section 143(2) of the Act applicable to the impugned assessment year.
On a reading of the said provision, it becomes clear that where a
return has been furnished under Section 139 of the Act or in response
to a notice under Section 142(1), the Assessing Officer can issue
notice under Section 143(2) of the Act. However, the proviso to
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section 143(2) makes it clear that no notice under Section 143(2) of
the Act shall be served on the assessee after expiry of six months from
the end of the financial year in which the return is furnished. To my
understanding, section 139 used in section 143(2) of the Act is wide
enough to include a revised return filed under Section 139(5) of the
Act. Therefore, the Assessing Officer has time to issue notice before
expiry of six months from the end of the financial year wherein the
revised return of income was filed. In the facts of the present appeal,
admittedly, the revised return of income was filed on 10.11.2014.
Whereas, the notice under Section 143(2) of the Act was issued on
28.08.2015 i.e. before expiry of six months from the end of the
financial year (F.Y. 2014-15) wherein the revised return of income
was filed. Therefore, in my considered opinion, the notice issued
under Section 143(2) of the Act is within the period of limitation.
After carefully going through the decisions cited before me by the
Learned Authorized Representative of the assessee, In my humble
opinion, they are not applicable to the peculiar facts of the present
appeal. Therefore, these decisions would be of no help to the assessee.
Thus, ground no.1 and additional ground are dismissed.
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In the result, the appeal is dismissed. Order pronounced in the open court on 31st March, 2023.
Sd/- (SAKTIJIT DEY) JUDICIAL MEMBER Dated: 31st March, 2023. Mohan Lal
